With the little knowledge I have of capital markets, I find it little difficult to compare as Allied Blenders focuses more on volume growth with their entry level IMFL segment whiskey (OPM 7%) as compared to Piccadily which is more into the premium segment with more focus on margin growth as compared to volume with OPM of 25%. Still volume wise, Piccadily still has a long way to go. Hopefully the ongoing capacity expansion which gets completed next year will help with volume growth. Also, since the number of investors in Piccadily has gone up from 21k to 70k in past 3 years, whether the stock is still undiscovered is anyone’s guess.
Request senior VP members to correct my mistakes
Posts in category Value Pickr
Piccadily Agro Industries Ltd (22-07-2024)
Aarti Pharma Labs (22-07-2024)
Aarti Pharmalabs - ( extremely bullish commentary wrt medium to long term ) -
Q4 and FY 24 results and concall highlights -
Manufacturing footprint -
Atali - New Unit under construction for CDMO, making Intermediates
Dombivali - Unit -1 - APIs, Intermediates, CDMO
VAPI - Unit -2 - APIs, Intermediates, CDMO
Tarapur - Unit -3 - Xanthine Unit
Unit -4 - APIs, CDMO
Unit -5 - Xanthine Unit
Unit - 6 - Xanthine intermediates and allied products
Segment wise revenues breakup in Q4 -
Xanthine, its derivates and allied products - 44 pc vs 50 pc YoY
API and Intermediates - 37 vs 43 pc YoY
CDMO / CMO - 19 vs 6 pc ( that’s a huge jump )
Aarti Pharma labs is the largest manufacturer of Xanthine, Caffeine ( a Xanthine derivative ) in India. Aarti Pharma’s global mkt share in Xanthine and derivatives is > 15 pc
Other Xanthine derivates are used as mild stimulants and bronchodilators ( for management of Asthma and Influenza )
Aarti Pharmalabs is a key beneficiary of China +1 wrt all its business segments
Most of the APIs that the company makes have a good degree of backward integration giving them good control over the entire value chain
Domestic : International sales breakup for FY 24 @ 56:44. Out of the total international sales, aprox 80 pc are to the regulated Mkts ( a great indicator of organisations’s compliance and quality culture )
In their CDMO business, they are currently working on 16 innovator molecules in various stages of development
Aim to grow topline by an avg of 10-15 pc for next 3 yrs
FY 24 outcomes -
Revenues - 1852 vs 1945 cr
EBITDA - 386 vs 342 cr
PAT - 216 vs 193
Net Debt / Equity @ 0.14 vs 0.13 pc
RoCE - 18 pc
RoE - 14 pc
Q4 outcomes -
Revenues - 505 vs 448 cr
EBITDA - 117 vs 80, up 47 pc ( margins @ 23 vs 17 pc )
PAT - 65 vs 42 cr, up 53 pc
Company’s API business has a greater focus towards regulated mkts. Their key therapeutic areas include - Anti-Hypertensive, Ant-Diabetic and Oncology drugs
Company is going to undertake brownfield expansion for capacity addition of the Xanthene and derivatives. Aim to take the total capacity up to 750 MT/ Month by end of FY 25. Current capacity is around 425 MT/ Month - so that’s a substantial jump
Guiding for a 10-12 pc EBITDA growth in FY 25. Management admitted that its a conservative guidance since the company did have exceptionally good q4
CMO / CDMO is likely to remain a high growth area for the company for next 2-3 yrs.Should grow @ > 30-35 CAGR for next 2-3 yrs. CMO/CDMO business is margin accretive for the company
Current capacity utilisation of the Xanthene plants @ 90 pc, hence the brownfield expansion
Company believes that the Xanthene prices have bottomed out. Should only go higher from here
FY 25 is going to be a Capex heavy year. Company may end up spending to the tune of 600 cr for the brownfield Capex for Xanthene + plus the ongoing projects projects @ Atali ( that’s a lot of Capacity addition )
Most of the company’s CMO business is concentrated on supply of KSMs ( key starting products ) / RSMs ( regulated starting materials )
Breakup of capex for FY 25 -
Aprox 300 cr for ongoing expansion @ Atali
80-90 cr for Solar power projects ( for future savings on the energy costs. Post this, 1/3rd of company’s power requirements shall be met internally )
Rest for brownfield expansion for Xanthene and other small capexes at various locations
Company is confident of achieving ideal capacity utilisation on the expanded Xanthene capacities inside 2-3 yrs !!! ( this should result in a lot of growth )
Tax rate for FY 24 for the company was 28 pc. Should be around of 25 pc for FY 25
Disc: holding, biased, not SEBI registered, not a buy / sell recommendation
How to register with SEBI as a Research Analyst? (22-07-2024)
any NISM Exam Preparation Guide for NISM-Series-XV.
please give me some pdf
Ranvir’s Portfolio (22-07-2024)
Aarti Pharmalabs - ( extremely bullish commentary wrt medium to long term ) -
Q4 and FY 24 results and concall highlights -
Manufacturing footprint -
Atali - New Unit under construction for CDMO, making Intermediates
Dombivali - Unit -1 - APIs, Intermediates, CDMO
VAPI - Unit -2 - APIs, Intermediates, CDMO
Tarapur - Unit -3 - Xanthine Unit
Unit -4 - APIs, CDMO
Unit -5 - Xanthine Unit
Unit - 6 - Xanthine intermediates and allied products
Segment wise revenues breakup in Q4 -
Xanthine, its derivates and allied products - 44 pc vs 50 pc YoY
API and Intermediates - 37 vs 43 pc YoY
CDMO / CMO - 19 vs 6 pc ( that’s a huge jump )
Aarti Pharma labs is the largest manufacturer of Xanthine, Caffeine ( a Xanthine derivative ) in India. Aarti Pharma’s global mkt share in Xanthine and derivatives is > 15 pc
Other Xanthine derivates are used as mild stimulants and bronchodilators ( for management of Asthma and Influenza )
Aarti Pharmalabs is a key beneficiary of China +1 wrt all its business segments
Most of the APIs that the company makes have a good degree of backward integration giving them good control over the entire value chain
Domestic : International sales breakup for FY 24 @ 56:44. Out of the total international sales, aprox 80 pc are to the regulated Mkts ( a great indicator of organisations’s compliance and quality culture )
In their CDMO business, they are currently working on 16 innovator molecules in various stages of development
Aim to grow topline by an avg of 10-15 pc for next 3 yrs
FY 24 outcomes -
Revenues - 1852 vs 1945 cr
EBITDA - 386 vs 342 cr
PAT - 216 vs 193
Net Debt / Equity @ 0.14 vs 0.13 pc
RoCE - 18 pc
RoE - 14 pc
Q4 outcomes -
Revenues - 505 vs 448 cr
EBITDA - 117 vs 80, up 47 pc ( margins @ 23 vs 17 pc )
PAT - 65 vs 42 cr, up 53 pc
Company’s API business has a greater focus towards regulated mkts. Their key therapeutic areas include - Anti-Hypertensive, Ant-Diabetic and Oncology drugs
Company is going to undertake brownfield expansion for capacity addition of the Xanthene and derivatives. Aim to take the total capacity up to 750 MT/ Month by end of FY 25. Current capacity is around 425 MT/ Month - so that’s a substantial jump
Guiding for a 10-12 pc EBITDA growth in FY 25. Management admitted that its a conservative guidance since the company did have exceptionally good q4
CMO / CDMO is likely to remain a high growth area for the company for next 2-3 yrs.Should grow @ > 30-35 CAGR for next 2-3 yrs. CMO/CDMO business is margin accretive for the company
Current capacity utilisation of the Xanthene plants @ 90 pc, hence the brownfield expansion
Company believes that the Xanthene prices have bottomed out. Should only go higher from here
FY 25 is going to be a Capex heavy year. Company may end up spending to the tune of 600 cr for the brownfield Capex for Xanthene + plus the ongoing projects projects @ Atali ( that’s a lot of Capacity addition )
Most of the company’s CMO business is concentrated on supply of KSMs ( key starting products ) / RSMs ( regulated starting materials )
Breakup of capex for FY 25 -
Aprox 300 cr for ongoing expansion @ Atali
80-90 cr for Solar power projects ( for future savings on the energy costs. Post this, 1/3rd of company’s power requirements shall be met internally )
Rest for brownfield expansion for Xanthene and other small capexes at various locations
Company is confident of achieving ideal capacity utilisation on the expanded Xanthene capacities inside 2-3 yrs !!! ( this should result in a lot of growth )
Tax rate for FY 24 for the company was 28 pc. Should be around of 25 pc for FY 25
Disc: holding, biased, not SEBI registered, not a buy / sell recommendation
Long term investment strategy (Buy, hold but don’t forget) (22-07-2024)
Hi @Amit_Paul
Thanks for remembering me:joy:. Yup am doing excellent as of now, its 45X on PF in last 4 years, from March 24, up close to 45% now.
Hits Kalyan, AB Fashion, Force, moderate gains in rest of stocks (20-80%)
Exits: Narayana Hrudalaya (-4%) brand concepts (150%)
New entries Piccadilly agro, Samhi Hotels
Kalyan Jeweller ( 24%) 450% gains
Force motors ( 8%) 700% gains
Aditya Birla Fashion ( 25%) 30% gain
Aditya Birla Capital ( 9%) 100% gains
Tata power ( 3%) 25% gains
AGI Green ( 3%) 225% gains
Arvind Fashion ( 6%) 60% gains
Sanghvi Mover ( 3%) 20% gains
LT Food (3%) 90% gains
Thomas Cook (2.5) 100% gains
Wockhardt ( 7%) increased bet size
New
Piccadily agro 3% ( testing waters)
Samhi Hotels 3.5 % (accumulation)
Trading positions
- Swelect Energy
- Ion exchange
- PVRINOX
- Rushil Decor
5 BHEL
6 LIC Housing
7 Suzlon
8 watech vabag
9 Gulshan Poly
I am bit cautious on markets now as froth is building everywhere. Main killer in last 3 months was AB Fashion which was a losing position and gained from 208 levels to 330 in 4 month, capital allocation at 208 was close of 35% of PF with highly leveraged position, cashed out gains on 50% and converted remaining to delivery, playing on upcoming demerger as i feel post demerger valuation will rise to 500 levels.
Kalyan and force are real star, its nonstop for Kalyan, thanks to initial capital allocation of 20% despite its rise of 5.3 X from May 23, it still around 24% amid surge in other portfolio stocks, diluted 10% to shift capital in wockhardt. Still planning to hold this for 1000 as titan is shaken now by kalyan hence MF FII loyalty is shifting.
I am avoiding all Cap goods, Defence, Semi conductor stocks for now and all PSU basket, BHEL is exception as i still finding value in it.
Samhi Hotels looks interesting bet from risk reward perspective.
Water is next theme to invest, Ion exchange, EMS, Va tech wabag and Jash are good choice.
Cautious outlook on markets post budget as lot of churn will take place from hot sectors, consumer focus might come back due to political setback for BJP in last elections.
RS Software – Will they pay investors too? (22-07-2024)
Here are Volante’s financial statements from the last decade. The company has shown a consistently high CAGR; quality growth it has been.
Source: Tofler
Volante Financials v1.xlsx (13.7 KB)
Can RS Software deliver similar return ratios and growth if (big IF) and when the co starts firing on multiple product lines?
Motherson Sumi Wiring India Ltd (MSWIL) – Wired for growth (22-07-2024)
Hi, Yes, I am tracking and in fact have taken a position in the company. In the absence of a long history, difficult to say anything definitively but I like the fact that the business has natural tailwinds, financials are clean and the company seems to be growing faster than the industry, so gaining market share. Let’s see how it goes.
B’s Notes : company analysis, portfolio roundup (22-07-2024)
Business Analysis of Secured MSME Financing:
There has been a huge growth and in this segment and also 2-3 firms are available at a reasonable valuations due to the recent correction in this segment. So a small write up to clear my mind.
First the Problems:
- Very high default ratios.
- Lack of scale benefits.
- Lack of formal documents like GST Returns and CIBIL Scores.
- Lack of collection Infrastructure and Geographical penetration.
Now the Solutions:
- Securing it with their Home.
- Technology to some extent but feet on Ground are required for such business
- Again Technology to some extent but either references network may help
- Slowly expanding geography and adequate seasoning
There are few companies which fit the Bill
MASFIN, SBFC and FIVESTAR
Please share your views/ critique
Disc: I eat my pudding. Hence Please presume that I may have financial interest in some of these companies.
RS Software – Will they pay investors too? (22-07-2024)
Let’s try and demystify the RS Software puzzle before us:
[Disclaimer: This is half-baked work-in-progress - discussions on with payments domain experts; Inviting VP members experienced/connected with domain experts to raise their hand and help take the discussion/examination forward]
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Undeniable technology platform/architecting/product strengths: UPI Platform is handling monthly transaction volumes of 12Bn+; June 2024 volume was 13 Bn up from June 2017 volume levels of 10Mn 0r about 1300x in 7 years. Especially noteworthy is EFRM (Fraud & Risk Management) product (RSSL owned IP till last year; co-shared with NPCI from 2023) scaling up in tandem to support that volume of transactions with high availability, without degrading customer experience, with transactions getting completed within 5-6 seconds. No other Real Time Payment (RTP) infrastructure is anywhere near these transaction volumes - or has seen that kind of scaling up and therefore cannot claim that kind of high availability, high performance having been delivered.
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High foot-in-the-door Convincing/Success rate: RSSL was and still is a very small company when it own the UPI Tender in 2015 competing against ~70 other competitors - many were much bigger, well-entrenched payment companies like FICO, FIS, Fiserv and others like Volante, Vocalink. Yes, they were probably helped by some like FICO who refused to share the source code (mandatory for our sovereign payment infrastructure) and withdrew, but most others stayed in contention. Which means only one thing, RSSL could demonstrate RTP technology, process, and architectural superiority over other contenders. They won again the design and architecture contract for Payments Canada Real Time Rail (RTR) project. Implementation was through Intertec - but launch has been delayed several times, now pushed to 2026!
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Unable to Leverage/Build on early success: On the other hand, RSSL hasn’t been able to leverage these early successes and scale up on the revenue front (annually still somewhere at 60-80 Cr), although profitability is back with a bang and operating margins at all time highs of 36% in latest Qr). Surprisingly some other small businesses like Volante (in almost similar payments modernisation space) has scaled up 10x in revenues and profitability since 2018 (FY23 Revenues 206 Cr, EBITDA 35 Cr).
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Big Guns protecting Payments Modernisation Turf (?): The biggest global payment processing networks are Amex (TTM 52 Bn), Visa (TTM 30 Bn, MasterCard (TTM $22Bn), and SWIFT (TTM $). With the inevitable shift to RTP (driven by consumer demand and regulatory tech) gradually happening, its no wonder that the biggies would try and ensure continued/scaled up presence in RTP infrastructure and with Banks and FIs.
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Investments by Networks/Large Banks/Fis in RTP Vendors: