Gabriel India Limited (GIL) has increased its stake in TP Solapur Solar Limited (TPSSL).

TPSSL is a special purpose vehicle set up to build a solar power plant for the collective use of multiple industrial consumers. GIL is one of these consumers and has now raised its ownership in TPSSL to 5.688%.

Returns calculations clearly makes sense from date of merger only. Prior to that IDFC Bank management was running this place. Unfortunately the FY 18 was very bad for IDFC Bank with treasury losses in Q1 19, followed by big loss in infra in q2 and q3 19. We cant stick stock price reduction by old management on new management. What can new management do about stock prices prior to their taking over date.

2. Agree with you on the capital raise point.

3. Agree also on 1st principles approach.

4. ROE thing, I already answered they are making 10% only. I didn’t find misalignment, have explained in detailed note. They are raising capital at premium which is increasing their BVPS from time to time. Hopefully by the next capital raise, the profits will start talking and stock will go up again. We should ask them in the AGM when they might raise capital again.

Ps on a lighter note, wondering why this stock is discussed so much… i dont see much discussion in icici hdfc kotak etc

I do have the same thought. Also, the founder never provided any real strategy. He talks about how we have IP, IP, and IP. and never mentioned explicitly that the IP is with the developed and they are just the manufacturer and distributor of the product. He Talks like Vijay Shekhar Sharma. just ideas and ideas, every quarter he figures out a new multi-billion dollar industry, in which they are the only player.

with this CAPEX topline is 900 – 1000 Cr… How will they do 100 Cr PAT… my understanding is EBITDA margins will be 15-16%… Will PAT be 100 Cr?

What will be the exit EV/EBITDA multiple one can assume ?

Do you have the cell and module capacity coming online in next 1 year/3 years?

My notes from Deep Industries concall (Not exhaustive, only covering what I remember and what I thought was important)

• Seeing strong order pipeline in the standalone business, management expects it to convert to orders over the next few Qs (They have been saying this for some Qs, lets hope nos. start getting in the OB soon)

• Expect to grow the standalone business by 20-25% YoY

• Dolphin barge Prabha is undergoing final stages of refurbishment. They have spent 11-11.5mn $ in refurbishing the barge and getting it to working condition. They may have to spend 10-20% more. Prabha is expected to start earning revenues in Q3. Prabha will be deployed in Mexico and management is hoping Prabha can be contracted out for 320 days in a year at a per day rate of ~50000$/year. So annual revenues can be INR 130Cr in FY26. Management expects 50-60% EBITDA margin on Prabha revenues

• Apart from Prabha, Dolphin has bagged an INR 50Cr DSV (Diving support vessel) refurbishment contract where in they will get paid to bring the client’s DSV to operating levels via repairs and refurbishment. The contract is to be executed in FY25. Thanks to this contract and Prabha, management expects 70-80Cr revenues in Dolphin in FY25

• Other assets in Dolphin are anchor tugs which are need of significant repair. Management has no immediate plans to repair them. Instead they are on the lookout for acquiring an OSV/DSV in the second hand market. This is difficult in my opinion as OSV/DSV rates have gone through the roof due to supply shortage and any vessels purchased at current prices may lead to sub-par returns on capital

• Overall I feel in FY26 Deep Industries can deliver 170-180Cr PAT (with 25-35Cr PAT
  coming from Dolphin) in FY26 if management executes smoothly in the standalone business and Dolphin. Management quality is not pristine as highlighted in this thread earlier and O&G is inherently a volatile business subject to oil price fluctuations. But given GoI’s thrust on increasing domestic oil production, over the long term, O&G ancillaries like Deep Industries and Seamec could be interesting plays.

Disc: Invested