MTAR Technologies Recommended as Buy, Target Price Set at Rs 4810 by Motilal Oswal
Motilal Oswal Research Report: MTAR Technologies
Company Overview
MTAR Technologies (MTARTECH) is a precision engineering company serving niche, high-barrier industries across defense, aerospace, nuclear energy, and clean energy. The company has a growing exposure to global fuel cell technology through its decade-long partnership with Bloom Energy (BE).
Market Opportunity
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The world is witnessing an unprecedented growth in data centers, with an expected 100 GW of new capacity expected during 2026-2030, reflecting a 14-18% CAGR. However, grid connections take 2-5 years, which is a significant challenge for the expansion of AI infrastructure. Bloom Energy's solid oxide fuel cell (SOFC) technology offers a speed advantage, deploying 50-100 MW of power in 90-120 days with five-nines reliability.
Partnerships and Growth
Bloom Energy has a USD20b order backlog and partnerships with Brookfield, AEP, Oracle, and Equinix, reflecting the growing confidence in its proposition. The company's manufacturing capacity is set to double to 2 GW by CY26 from 1 GW in CY25 and further to 4 GW by CY28, indicating a well-supported growth trajectory.
Outlook and Recommendation
We expect MTARTECH to post a CAGR of 40%/55%/78% in revenue/EBITDA/adj. PAT over FY25-28. Based on this outlook, we reiterate our BUY rating on the stock with a Target Price (TP) of INR4,810 (50x FY28E EPS, ~0.6x PEG on FY25-28E EPS CAGR).
Investor Takeaway
Investors should consider MTAR Technologies as a potential buy opportunity due to its growing exposure to global fuel cell technology.
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