Any data source to back this ?
Link – Kedaara-backed Aavas Financiers to get funding from foreign investor
Posts in category Value Pickr
India Pesticides Ltd (11-11-2023)
India Pesticides reported its financial results for the second quarter of fiscal year 2024 (Q2 FY24), ending on September 30, 2023. The key highlights are as follows:
- Total revenue for Q2 FY24 stood at Rs. 206 crore.
- EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was Rs. 31 crore, showing a significant increase of 19.2% compared to the previous quarter.
- Net Profit for Q2 FY24 was Rs. 20 crore, indicating a 25.6% increase quarter-on-quarter.
- Despite challenges in the agro-industry, such as high-cost inventories, destocking in international markets, and price declines due to oversupply of raw materials from China, IPL achieved sustainable revenue of Rs. 206 crore. This was driven by robust domestic demand and a strong focus on operational efficiency.
- IPL is continuing with its expansion project through its subsidiary, which is expected to be commissioned by the end of the fiscal year. The company is also investing in new products and expanding manufacturing capabilities at its existing facility. In the quarter, IPL acquired land adjacent to its Sandila plant, which will support future expansion efforts.
- IPL plans to incorporate an additional block for Intermediate and another for Technical by the second half of FY2024. This expansion is expected to increase production capacity by approximately 2000 metric tons, with completion scheduled for Q4 FY24.
Key Strategic Developments:
- IPL is implementing a strategic succession plan, welcoming the chairman’s sons to join the board, signaling a transition towards future growth.
- The company is in the planning stages of establishing a new subsidiary with an asset-light business model.
- IPL has acquired land adjacent to the Sandila plant to facilitate expansion efforts.
- There are plans to increase the present installed capacity of Technical and Intermediate by around 2000 metric tons to a total of 26,200 metric tons, expected to be completed by Q4 FY24.
- Capital expenditures (Capex) of Rs. 50 crore have been planned for IPL and Rs. 60 crore for Shalvis Specialities Limited (a wholly-owned subsidiary).
- IPL is exploring opportunities for further diversification into new chemistry.
- The Hamirpur Project is expected to be commissioned by Q4 FY24.
India Pesticides Ltd (11-11-2023)
IPL continues to suffer from inventory overhang in global markets, and have pivoted towards selling more formulations in India. They announced setting up a marketing co for formulations in export market, something similar to Sharda Cropchem. Concall notes below
FY24Q2
- Inventory loss of 6 cr. in Q2
- Pesticides I didn’t know they make
o Fungicides: Etridiazole, Dodine
o Insecticides: Diafenthiuron
o Herbicide: Flufenacet - Industry scenario: Continues to face headwinds due to destocking in international markets and price declines resulting from oversupply of raw materials from China
- Domestic formulation: 15-18% EBITDA margin. Export formulation is higher margin but volumes are very low
- LATAM: don’t have direct subsidiary but are present through partners (8-10% revenue contribution)
- Company is planning to setup a subsidiary for marketing formulation in export market in an asset light business model (something similar to Sharda Cropchem)
- For new products, want to maintain 20-22% EBITDA margin & 43-44% gross margin
- Prosulfocarb: very high inventory in end market resulting in volume pressure for IPL
- Expansion
o Intermediate block and technical block will be commercialized in Q4FY24. Will augment production capacity by ~2000 MT
o Acquired land adjacent to Sandila plant for future expansion
o Have spent 46 cr. in H1FY24 (budget of 110 cr. for Sandila + Hamirpur)
Disclosure: Not invested (no transactions in last-30 days)
Phantom Digital Effects Limited (11-11-2023)
Thanks for your clear explanation. Do you know reason for increase in inventory?
Mayur Uniquoters ~ Market Leader in Indian Synthetic Leather Market (11-11-2023)
Company continues disappointing on their guidance, some or the other thing keeps becoming a hindrance in their growth. Currently, they are struggling because of footwear and auto export slowdown due to strikes in US. Concall notes below.
FY24Q2
- PU sales: 2 lakh sq.m with 1 lakh sq.m sold in October
- PVC sales: 70 lakh sq.m (same as Q2FY23)
- Exports (52 cr.): export general (15 cr.), export auto OEM (37 cr.)
- Sales growth was 40% in auto replacement, 12-13% in domestic auto OEM, 5% in other segments. Exports were down (-20%), footwear was down by (-20%). Footwear saw inventory destocking due to BIS enforcement and auto exports was affected due to strikes in USA
- Current export OEM run rate is 1-1.25 lakh sq.m which should increase to 2.5-3 lakh sq.m
- Hopeful of reaching 850 cr. in FY24
- Next 6 months will see ramp up in auto exports
- Retail furnishing: 400 dealers and should reach 600 in next 6 months
Disclosure: Invested (position size here, no transactions in last-30 days)
Aavas Financiers :: Banking on the unbanked (11-11-2023)
My thought process is that the kind of lending they’re doing is in either less salaried or self employed so they can’t go aggressive or they risk higher NPA.
On a side note, point me if I’m wrong, technically the stock may be forming a cup and handle pattern. The handle’s base is forming.
Note: Tracking the stock.
Phantom Digital Effects Limited (11-11-2023)
Short term borrowing (STB) is from Bank in the form of Over draft (OD). It is backed with Account Receivables as Collateral (Src:AR)
As some portion of Trade Receivables (TRs) is already used / received indirectly in the form of Short term borrowings, the same needs to be adjusted from the overall TRs…that’s the reason it is shown under Operating Activities → Adjustments for Changes in Working Capital so that this STB amount is deducted from the TRs
For example, if the total TRs is 100/- and from that company has already used 40/- in the form of STBs / OD …then the balance TRs has to be 100-40 = 60/- and can’t be still shown as 100/-
Investing Basics – Feel free to ask the most basic questions (11-11-2023)
Rating agencies have their own shades of black, citizens of US who know about GFC know this. This being said, if the reasons for a downgrade have merit, the reasons why not necessarily new and were present in the past, but if the present situation cannot be compared to the past, there could be some affect. Wall Street knows what it is doing. I have got not one bit of idea about US bond yields, but have a little idea about our bonds, our creditworthiness, our rating agencies, so doing some extrapolation.
As far as your second question is concerned, all are interconnected economies, and as such, interconnected markets, so if there is a damaging reaction over there, I guess it will reflect in our market too. Profit booking always happens, even when the results are good, so if the big movers change their stance, so will the participants below them, at least for the shorter term. And if we believe that participants are taking informed decisions, becoming matured, and buying the dip has become a strategy, then the effect on our market could be less.
Very vague thoughts, so take them with a bag of salt.
Swiss Military Consumer Goods (11-11-2023)
Incorporated in January 1989, ‘Swiss Military Consumer Goods Limited’ (formerly ‘Network Limited’) had been taken over by the present promoters in September 2020. It is Headquartered in New Delhi. It is trying to find a firm placing in the immensely competitive yet significantly stimulating Indian market.
The brand symbol in itself makes it an aspirational brand for the Indian middle class.
The opportunity size or the TAM (Total Adressable Mkt) is huge. Swiss Military Consumer goods places themselves to the customers as a Premium Brand at an affordable price.
Growth strategy
Presently, the brand has a presence across 1,000 touchpoints.
The company is eyeing 10,000 touch points by March 2024. It is yet to be seen if they will be able to achieve it.
The product mix is a very diverse range, however, for a very small market cap company, they have been able to rope in Randeep Hooda as their brand ambassador.
A simple Amazon.in search for Swiss Military yields a large number of products up for sale.
At the first look of it, the products have been prepared with an aesthetic sense and ergonomic designs.
The India room heater market size was estimated at USD 90.6 million in 2022. During the forecast period between 2023 and 2029, India room heater market size is projected to grow at a CAGR of 8.1% reaching a value of USD 151.8 million by 2029. The demand for room heaters is increasing at a high rate in India owing to the rising disposable income and increasing launches of new and affordable products and brands.
It would be interesting to see how their newly launched oil radiator heaters do in the market.
https://www.amazon.in/Swiss-Military-Fin-OFR-Heat/dp/B09QCXN6Y2/ref=sr_1_1?crid=1J3FEKT3V5DYS&keywords=heat+max+swiss&nsdOptOutParam=true&qid=1699727952&sprefix=heat+max+swiss%2Caps%2C226&sr=8-1
India being the fastest growing economy, the inceasing pay levels, penetration of electronic devices and laptops, are all growth trigger for the company, for its extensive range of laptop bags. India in future is going to be a net exporter of laptops and tablets. India’s laptop, tablet exports to reach $100 billion by 2025: ICEA report | Laptops-pc News
Laptop bags go as a complementary product. The scale at which the company can produce, the Swiss Military brand tag, places the company in a sweet spot to tie up with one of the reputed laptop producers to offer its products.
The promoters seem passionate about what they are doing and their push is visible in increasing revenues.
To be continued…
Investing Basics – Feel free to ask the most basic questions (11-11-2023)
Q1-How a recent US crediworthiness downgrade by moody’ may effect US bond yieds ?
Q2-Can this downgrade relate to indian stock market , if its interlinked to indian stock market at all ?