Kirloskar Oil Engines (KOEL) shares rose on Tuesday and went up 10% on the day after the company’s first-ever entry into the data‑centre power solutions market. The stock, which rose nearly 20% on Monday, still had a good case in hand that investors are optimistic about the long‑term growth of the company.
On Monday KOEL shares hit a 52‑week high of ₹2,360 after news of a huge order of 192 megawatt from global hyperscaler HyperNext for 96 units of KOEL’s 2,500kVA Optiprime Dual Core Systems, marking the company’s first hyperscaler data centre. This deal is a game-changer and it breaks the dominance of Cummins, which has an 80% market share in the hyperscaler data centre.
The rally continued in Tuesday’s session and trading volumes were much higher than average. The analyst said institutional interest has increased with a rise in brokerages upgrading its stock price. JM Financial raised its target price to ₹2,430 and Motilal Oswal set a target of ₹2,350 with 23% CAGR revenue growth through FY29.
The stock has been supported by market experts who believe KOEL has turned into a multi‑segment power solutions platform, and the company is confident that it will become a multi‑segment power solutions business in the future, targeting $2 billion in revenue by FY30 with opportunities in data centres and industrial power and renewable energy integration.
Despite optimism, some trackers have warned of execution risk and high valuations. Platforms such as TrackTollywood reported a 65% drop in volumes compared to the weekend’s surge but said that the stock could struggle to sustain momentum beyond the original targets. But the general sentiment is positive overall, at least for the most part, and in part, because Kirloskar’s brand is nostalgic for people who are nostalgic for the Kirloskar name and how it has adapted and is able to adapt to new market demands.
KOEL's recent performance has also furthered its reputation as a multibagger. The stock has earned 183% returns in a year and 879% in five years making it one of the top performers in the Indian industrial sector. With strong fundamentals, a growing market presence and institutional backing, investors are keen to see if the rally is going to continue.
Kirloskar Oil Engines’ shares are up for the second day, which is an indication of the confidence of the market in its move towards data‑centre solutions. There remain challenges to overcome but the company’s strong order book, analyst upgrades and history of success make it a key player in India’s power solutions market.
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