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Aspen Technology's Mtell to Aid SCG Boost Asset Utilization

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Aspen Technology (AZPN - Free Report) has been securing notable customer wins on the back of its strength in asset optimization and management solutions.

Recently, the company announced that Thailand-based SCG, a provider of comprehensive packaging solutions intends to deploy Aspen Mtell software to reduce unplanned downtime.

Aspen Mtell enables customers to augment asset utilization by providing a robust set of solutions which supervise health of the machinery, identify failure symptoms in real time, analyze the root-cause of the problem and provide valuable feedback to avoid equipment failure.

Notably, Aspen Technology acquired Mtelligence Corporation (also recognized as Mtell) in October 2016, with an aim to strengthen its asset performance optimization software suite with robust prescriptive and predictive maintenance capabilities.

Mitigating Unplanned Downtime: Key Catalyst

Aspen Technology reveals that 82% equipment failures cannot be dealt in a specific scheduled maintenance framework. The real-time monitoring of equipment using robust technical methodologies assists asset-intensive enterprises to mitigate unplanned downtime risk to a greater extent.

Furthermore, per estimates as revealed by Aspen, losses of $1.4 trillion arise from unplanned downtime.

These factors drive adoption of Mtell, which provides comprehensive predictive maintenance software solutions. This in turn favors the company’s top line.

Management remains elated on the growing clout of Mtell offering which is strengthening the company’s presence globally. Mtell was selected by Europe-based Borealis in a bid to enhance reliability in its Polyethylene Production processes in April 2018.

Additionally, the market opportunities for Mtell seem to be plenty. According to MarketsandMarkets, the predictive maintenance market is projected to increase at a CAGR of 28.4% to reach $4.9 billion in 2021 from $1.4 billion in 2016. We believe that the company is well poised to gain from this robust growth prospect.

To Conclude

Aspen Technology is benefiting from robust adoption of its Asset Performance Management suite. The company is also witnessing increased demand from E&C customers and Latin America customers.

However, stiff competition in the asset management market is a major headwind. Further, integration risks remain a concern.

Zacks Rank & Key Picks

Aspen Technology carries a Zacks Rank #3 (Hold).

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