Dynamatic Technologies Surges 250% in 2 Years, 903% in 4 Years – What's Next?

Dynamatic Technologies, a leading manufacturer of hydraulic gear pumps and automotive turbochargers, has emerged as a prominent wealth generator on Dalal Street. Over the past two years, the company’s shares have surged from ₹2,428 to ₹8,502, delivering a remarkable 250% return. Over a four-year horizon, the stock has produced an extraordinary 903% return, illustrating its strong performance. For instance, an investment of ₹1 lakh in the company during this period would have grown to ₹10 lakh today.

ICICI Securities, a domestic brokerage firm, recently maintained its positive outlook on Dynamatic Technologies despite the significant rally in its share price. The brokerage has set a target price of ₹10,250 per share, accompanied by a ‘buy’ recommendation. The company’s current market capitalization stands at ₹8,555 crore, according to data from NSE.

Dynamatic Technologies is known for manufacturing highly engineered and mission-critical products for the aerospace, metallurgy, and hydraulics industries. It commands a dominant position in the Indian OEM tractor market with an 80% share and holds approximately 38% of the global tractor market. The company also serves as a Tier-I supplier to major global aerospace original equipment manufacturers (OEMs) and primes, including Airbus, Boeing, Dassault Aviation, Bell Helicopters, Hindustan Aeronautics Limited, BEL, and Spirit Aerosystems.

In the September quarter of FY25, the company reported flat revenue growth year-over-year, with revenues totaling ₹361 crore. The aerospace segment remained the leading contributor to overall revenue, achieving a 14.9% year-over-year growth to ₹148 crore. This performance was achieved despite industry-wide challenges, such as supply chain disruptions, parts shortages, and rising shipping costs. Dynamatic Technologies has secured substantial orders, positioning its aerospace business for potential doubling within the next 30 months.

The hydraulics segment also posted strong growth, with revenue increasing by 28.3% year-over-year to ₹130 crore. Favorable monsoon conditions boosted agricultural activities, leading to higher volumes in markets such as the UK and India. Margins in this segment are recovering, aided by product line optimization efforts at facilities in Swindon and Bangalore. On the other hand, the metallurgy segment faced significant challenges, with revenue declining by 31.3% year-over-year to ₹82 crore. Weak global and domestic demand, coupled with higher energy costs and euro appreciation, were key factors in this decline. However, Dynamatic Technologies is leveraging its technical expertise to shift its metallurgy subsidiary’s focus toward aerospace and defense. Sample defense parts have already been delivered, with full-scale business expected to commence in the second half of the fiscal year.

To sustain growth across its key segments, the company is prioritizing several strategic initiatives. In the aerospace division, efforts are concentrated on manufacturing advancements and the development of new products in assembly and detailed components, aiming to enhance both revenue and margins. The hydraulics segment seeks to expand its aftermarket presence, improve operational efficiencies, and adopt value engineering practices to boost profitability. Innovative product development is expected to increase the company’s share within the market. Meanwhile, the metallurgy segment is focusing on transitioning to a high-margin product mix, rationalizing low-margin offerings, and advancing aerospace castings and forgings. These efforts are designed to position the business for robust growth in the coming year.

Dynamatic Technologies’ strategic actions reflect its commitment to long-term growth and solidify its standing as a significant player in its core markets.