Emerson Chosen By IndianOil For Modernization Of Refineries
Zacks Investment Research | Mar 11, 2019 09:59PM ET
Emerson Electric Company (NYSE:EMR) recently announced that it has entered into multiple contracts with Indian Oil Corporation Limited — the leading commercial oil company in India. Notably, per the $12 million contract, Emerson will help IndianOil to modernize its operations and emissions programs at its refineries.
Notably, the contracts will involve Emerson to work as automation contractor, providing advanced technologies and refining proficiency. The project will include modernization of IndianOil’s 14 separate process units. These include diesel hydro-treating units planned for reducing sulfur content as well as octane-boosting units upgraded with desulfurization technologies. Some of the advanced technologies to be installed by Emerson are DeltaV safety instrumented systems, DeltaVTM distributed control systems, AMS asset management software, WirelessHART-enabled instruments and several wired field instruments.
In addition, the company will offer commissioning, factory-acceptance testing as well as training support services for IndianOil’s refineries based in Vadodara, Haldia, Bongaigaon and Panipat. As a matter of fact, this will enable IndianOil to adhere to Bharat Stage VI low-sulfur emissions standards.
Our Take
Emerson is well positioned to benefit from favorable global industrial end markets, as its core businesses hold dominant positions in markets tied to energy efficiency and infrastructure spending. Going forward, the company’s Automation Solutions segment is likely to benefit from broad-based demand across most key markets, strong Maintenance, Repair and Operations projects as well as ongoing small to mid-sized brownfield and expansion projects.
This, along with the company’s cost-reduction moves, lower corporate taxes and greater operational efficacy will drive its profitability. In the past three months, the Zacks Rank #3 (Hold) stock has returned 11.1%, outperforming the Zacks Investment Research
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