Welspun Corp Seen Up 27% on Capacity Expansion and Strong Order Book

Jefferies, a global brokerage, has given a 'Buy' rating to Welspun Corp, the world's largest welded line pipe manufacturer. The company is expected to see significant growth in the next three years due to several factors.

The first factor is capacity expansion, particularly in the US where energy infrastructure investment is at a multi-year high. Jefferies expects strong demand for liquefied natural gas (LNG) exports, higher electricity demand from data centers, and increasing gas output from the Permian Basin.

Welspun already has around 30% market share in the US and is expanding its capacity there. The brokerage believes this expansion will increase Welspun's contribution from higher-margin markets over time.

The second opportunity for growth lies in Saudi Arabia, where the country is increasing spending on gas transmission and water infrastructure under its Vision 2030 program. Jefferies sees a 'big opportunity' in Saudi Arabia for manufacturers with a domestic presence, such as Welspun Corp.