“To make the Investments of Rs.114.29/‐ Crores (Rupees One Hundred and Fourteen Crores and Twenty Nine Lakhs Only) in the wholly owned Subsidiary i.e. Shakti EV Mobility Private Limited.”

Net Gross Block of the Company is only Rs 147 Cr and Company had achieved a turnover of around Rs 1200 Cr in FY 21-22. The Capacity utilisation is slightly higher than 50% and therefore it means that the Company can double its revenue from here without any incremental CAPEX in next 2 to 3 years. Company can generate cash accruals of around Rs 150 Cr to 200 Cr annualy on a sustainable basis for next 3 to 4 years due to picking up of KUSUM scheme. As CAPEX requirement is not there for funding incremental growth and working capital requirement can be taken care by working capital borrowing, Company will have sufficient cash to invest in some diversified but related activities.

Company had been commenting on it EV business. Excerpts from Q1 concal

• Under EV business, we have done a tie up with a bus manufacturer and we are developing motors with them and our motors are on the roads which we developed earlier in our R&D under our EV company and now slowly its sale will also start.

• Currently our company is in development stage, for construction building work and civil work is going on, but we have started our product development work long ago.

• We have experience of making motors for induction motors, BLDC motors, PMSM motors and we have already developed all these motors.

• You will be very happy to know that we already do controller manufacturing in our company, so already our 175,000 controllers are running in India which is a matter of pride for us. We have already developed technology.

• We have developed under 2 wheelers and in 3 wheelers it is under development.

• We have developed and released for 2 wheelers in market.

• And regarding 1,75,000 controller it is solar controller, means it doesn’t matter whether it works on battery or solar panel, technology is almost same, but yes, money goes in development and time is gone in development. So we have developed a lot in that and already company is in-house and work is going on, and there are many engineers from IIT Delhi, IIT Mumbai and other IITs are working on R&D and more than 28 patents are there and we have done a lot of work in the controller.

• Another 1 year or 1.5 year more will go for Plant to be ready.

• In controller, the bought out items are chip, PCB, IGBT, resistance and this technically which is used in power electronics is there, we do the assembly of the SMT line in-house only, do the designing in-house this is regarding controller.

• We make motors in-house, we have a stamping machine with us, we do machining ourselves and only bought out items are aluminum inbox or aluminum components are bought out items, rest all is an in-house process.

• We have NDA with them otherwise our motors are on road now. Already 400 buses are on roads with our motors.

Its good that they are investing in the area which they are already working and have expertise, however only time will time how fruitful the proposed investment is. Even after the proposed investment Company is likely to remain long term debt free.

Management quality i have found to them to be honest and committed. In the past they had given very high revenue growth targets which they were not bale to fulfill. The management has now become realistic and therfore they have given revenue growth target of 20 to 25% , however I believe that with the orders in hand and new orders which will be coming , Company can easily achieve revenue growth of at least 50%.

Disclosure: Invested and is now substanital part of my portfolio.

Just wondering…as the company has fair bit of exposure to US markets, and few economists already anticipating a recession in US mid next year, how this is going to impact SBCL’s growth/projections?

Investing in MF and stocks are 2 different things, SIP or otherwise.

SIP is MF is due to the reason of not timing the market, which is time consuming to certain extent, and the investor may feel to not invest and wait, citing high valuations or low valuations, and as such, he may miss certain periods of time, which may impact the overall return. So, invest irrespective of the levels of the market, irrespective of the valuations, at regular intervals. There have been some articles, studies done on SIP or other ways yielding results, one can look at them to see the differences, if there are any.

SIP in stocks is different, one can look at business, valuation, chart and take decisions, which need not be at regular intervals. Even, if one wants to build a position in a stock, it need not be at regular intervals, there are many ways to do it depending upon a lot of things, say market falls in a particular week, and the stock falls by 10% in the same period, and this could be an buying opportunity. Many ways to do this.

Intel asset fire sale continues. Only fab is the end goal (IMHO). At this rate, they might have planned spinning off design team too.
They are going to IPO altera… they acquired it in 2016.

As it was mentioned in concall, last quarter company did not increase price, focused on occupancy. Upcoming two quarters I believe they will increase price due to events and short supply with already increased occupancy rate. Looks disposable income is rapidly rising and people are spending on higher ticket spending such as occupying branded hotels, travel, buying luxury goods.
Disclosure: Invested