Kirloskar Oil Engines share jumped 20% to touch a 52-week high in early trade on Monday, after the company announced bagging of a significant order for large-scale data center infrastructure. Kirloskar Oil shares hit 20% upper circuit at a fresh high of ₹2,390.80 apiece on the BSE.
The rally in Kirloskar Oil Engines share price today was also supported by strong trading volumes. Around 18 lakh equity shares of Kirloskar Oil Engines changed hands on stock exchanges as compared to its one week average tracing volumes of 5 lakh shares and one month average volumes of 4 lakh shares.
Power generation solutions manufacturer Kirloskar Oil Engines announced receipt of a significant order from HyperNext, a next-generation digital infrastructure company focused on delivering hyperscale-ready, AI-enabled data center solutions.
The order comprises 192 MW, 96 units of KOEL’s 2500 kVA Optiprime Dual Core power systems, representing one of the largest deployments of high-capacity power systems for hyperscale data centres in India.
“As AI and cloud adoption accelerate globally, data centers require robust and resilient backup power systems that can support ever-increasing energy demands. Our Optiprime platform has been developed precisely to address these challenges, delivering exceptional performance, reliability, and operational efficiency for Hyperscale data centres,” said Madan Patil, President- Global Powergen Business, Kirloskar Oil Engines.
Brokerage firm JM Financial believes the order win marks a significant inroad for Kirloskar Oil Engines into the colo and hyperscalar data centre space that is currently dominated by Cummins.
“This development reinforces our view that with multiple product introductions and reduced technology gap (or capability gap) the valuation discount of Kirloskar Oil Engines versus Cummins will diminish. Kirloskar Oil Engines’ capex commitment towards HHP engines by adding 20,000 engines/pa capacity has to be seen in this context,” said JM Financial.
According to the brokerage firm, a combination of significant product introductions (particularly HHP), top tier talent acquisition from competition and export focus can drive further re-rating in the stock.
It largely retained FY27E EPS estimates but increased FY28E by 8% considering higher HHP growth and improved mix. It values Kirloskar Oil Engines at 42x FY28E EPS versus 35x earlier.
“Kirloskar Oil Engines shares trade at 40x FY28 P/E which, while expensive versus historical valuations, still offers value on higher expected growth in preference to Cummins,” JM Financial said.
The brokerage house upgraded its rating on Kirloskar Oil Engines shares to ‘Buy’ from ‘Add’ earlier, as data centre penetration largely closes the technology gap, and target price to ₹2,430 apiece from ₹1,955 per share earlier.
Kirloskar Oil Engines Share Price Performance
Kirloskar Oil Engines share price has gained 43% in one month and has rallied 73% in three months. The stock has jumped 95% on a year-to-date (YTD) basis and has delivered multibagger returns of 183% in one year.
Over the past three years, Kirloskar Oil Engines share price has surged 488%, while it has given staggering returns of 879% in five years.
At 9:50 AM, Kirloskar Oil Engines share price was still locked at 20% upper circuit of ₹2,390.80 apiece on the BSE.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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