Yes, it was quite surprising that they responded to ‘a stranger’ on call and they were not hesitant to respond to tough questions.

This time my objective was to see check that even after the fall they are still responsive to the call

Thanks visuarchie for sharing the list. Could you please share how do you calculate a year and 6 months back prices? For e.g if today is 18th March 2024, which date will you pick for 12 and 6 months back and how?

RACL continues their growth trajectory (17% sales and flat EPS) and are confident of reaching 548 cr. sales in FY25 (implying 37% absolute growth). Concall notes below.

FY24Q3

• Nominated as a Tier 1 supplier for passenger car segment for the first time. This is for entire subsystem for park lock mechanism and from a new customer for an electric sports car using a new platform coming in 2027 ($38mn business over 7-8 years starting FY27). Competitors were Chinese and European companies. This can change the trajectory of RACL’s business (from 500 to 1000 cr.). Will be manufactured in Gajraula plant (which is now running on 100% green energy)
• Inaugurated plant 2 in Noida (26k sq.ft vs 11k sq.ft of earlier Noida plant). Equipped with clean rooms and invested $1mn capex. Doubled manpower from 120 to 250. Will export new electric bicycle product, earlier plant was only catering to domestic market
• For the electric bicycle product, their customer’s competitor is selling 2mn bikes/year
• Started invoicing KTM Austria locally on a weekly just in time basis
• Capex: 80-85 cr. in FY24, 60 cr. in FY25. Have invested 25 crs. in last 2-years for housing colonies for engineers and managers.
• Still have 10 acres of land
• Sales should reach 548 cr. in FY25
• With 22 customers, RACL is present in every segment (100 cc 2-W, 49 ton truck, passenger cars, tractors, off-road vehicle for sand, snow, etc.)
• With EVs and their low-weight requirements, have seen manufacturers shifting to non-ferrous materials (aluminum, titanium, etc.). Also have seen huge increase in demand for precision machining

Disclosure: Invested (position size here, bought shares in last-30 days)

PE is high due to depressed earnings. Price has increased recently due to anticipation in recovery.

The Domestic Formulation players are very well poised for double growth. Pharmaceuticals could be a go to sector with stable returns despite of the regulatory overheads of price control.

Many companies have successfully tapped the inorganic route over the years