Centum Electronics Zooms 10% After Chandrayaan-3 Lands On Moon; Should You Buy?

Centum Electronics shares jumped nearly 9 per cent in the morning session on August 24, post the successful landing of Chandrayaan-3 on the moon.

Centum was a key industrial partner to ISRO for electronics on the prestigious moon mission and supplied critical modules and systems.

The company delivered more than 200 mission critical modules to the Chandrayaan-3 mission, according to the company’s website.

After Chandrayan-3’s successful softlanding on the moon, India became the fourth country after the US, China, and the former Soviet Union to do so. India also became the first country to reach the unexplored, larger south pole of the moon.

Centum Electronics released its Q1 results on August 11, the consolidated revenue of the company increased by 17 percent YoY mainly due to an increase in the electronics manufacturing services (EMS) business.

Revenue decreased QoQ due to higher revenue of build to spec (BTS) in the previous quarter, which is lumpy in nature. EBITDA margins increased from 5 percent in Q1-FY23 to 7 percent in Q1-FY24 due to improved revenues in the EMS business.

Focused efforts are being taken to improve the EBITDA of the French subsidiary in the coming quarters to improve the consolidated EBITDA from the current levels according to a filing with BSE by the company.

Multibagger Returns

Centum Electron shares gave 189.03 per cent returns over the last six months and 273.51 per cent returns over the last 12 months. The benchmark Nifty50 index has given a return of 11.33 per cent over the past six months in comparison.

Should You Invest?

Stocks of companies, that played a part in ISRO’s moon mission, rallied up to 12 per cent on Thursday as investors found extra space for companies betting on India’s cosmic power.

Despite the short-term gains, analysts say the overall long-term outlook for these counters remains bullish as the Chandrayaan-3 opens up the global market for Indian companies.

Analysts say that despite the recent run-up, some of the space stocks are still not that expensive. Chakri Lokapriya of TCG AMC went on to say that a number of these Indian companies could now attract international attention from even Elon Musk.