Aerospace stock jumps 9% after signing major agreement with  Dassault Aviation

Synopsis: Dynamatic Technologies Ltd  has signed a new agreement with Dassault Aviation (the maker of Rafale jets and Falcon business jets) to build the entire rear fuselage of Dassault’s latest business jet, the Falcon 6X.

This small-cap stock is engaged in manufacturing of hydraulic gear pumps and automotive turbochargers whose products are widely used across Aerospace, automotive and hydraulic industries, jumped upto 9 percent in the day’s trade upon signing an agreement with Dassault Aviation. 

With the market capitalization of  Rs. 6,074 Crores, the shares of DTL has reached an intraday high of Rs. 9,266 per equity share, rising nearly 9 percent from the previous day close price Rs. 8,478.

What is the News: 

Dynamatic Technologies Ltd has recently signed an agreement with Dassault Aviation to build the entire rear fuselage (back section of the aircraft body) of Falcon 6X, a premium business jet known for long travel range and advanced technology. Dynamatic was already making a rear fuel tank for Falcon 6X and it was delivered successfully and became a reliable partner of Dassault upon which the company got the bigger role to manufacture the entire rear fuselage for Falcon 6X.

Company Overview & Financial Highlights

Dynamatic Technologies Ltd is majorly involved in manufacturing of hydraulic gear pumps and automotive turbochargers catering various industries such as aerospace, automotive and hydraulic industries. The company has manufacturing facilities in Europe and India serving customers across 6 continents.  The aerospace industry contributes 46 percent of the total revenue whereas hydraulics and metallurgy contribute 32 percent and 22 percent of the total revenue respectively. 

The company has recently launched AI-enabled First Article Inspection (FAI) for the Airbus A220 Aft service door which makes it a major milestone for the company as DTL  becomes the first in the aerospace industry to integrate AI into the industrialization process. The company is one of the largest manufacturers of hydraulic valves, hydraulic gear pumps. It has an 80 percent market share in the Indian OEM tractor market and about 38% in the global tractor market.  

Year on Year analysis: Dynamatic technologies ltd’s revenue has increased from Rs. 361 Crores to Rs. 392 Crores, up ~12 percent, operating profit increased by ~8 percent from Rs. 41 Crores to Rs. 46 Crores and net profit decreased by  72 percent, from Rs. 12 Crores to Rs. 3.31 Crores.

Quarter on Quarter analysis: Dynamatic Technologies Ltd’s revenue has increased on a quarterly basis from Rs. 370 Crores to Rs.392 Crores, up ~6 percent, operating profit increased by ~22 percent from Rs. 37.78 Crores to Rs. 46.24 Crores, and net-profit decreased by ~70 percent from Rs. 10.77 Crores to 3.31 Crores

Written By- Vachan Kadli 

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