In addition, it is enjoying strong earnings growth and overall visibility with an order book of $27.4 billion, as its various key operating segments pull their own weight.
The commercial aerospace segment is seen to benefit from higher maintenance, repair and overall earnings on the back of better aviation traffic, higher nacelle sales, and improved profits for its passenger-to-freighter (PTF) conversion business amidst economies of scale and improvements in the learning curve.
The urban solutions and satellite communications segment should see improvements ahead following a right-sizing exercise and earnings contribution from its TransCore traffic management unit.
Last but not least, its defence and public security business’ profitability should be supported by the gradual delivery of its order book.
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"A potential decline in interest rates would be positive, as 38% of STE’s debt is still exposed to a floating interest rate," says Jaiswal.
He is projecting a 15% profit CAGR for FY2023 to FY2026.
