There is another similar business in this space is VA wabag Like water treatment etc you may like to keep on your radar. I invested @250 and recently exited on double around @500…I had some better opportunity to invest. They are boring and profitable businesses also limited players in this space.

Krishca today investor meeting notes:

1/ Co has won multiple packing contracts in last 2 weeks. Expects 10-15 crs contribution from packing contracts in FY24. Already hired an experienced industry leader to head packing contracts business. Packing contracts will have same margins as strappings

2/ Upcoming strapping capex is funded by internal accruals. They may look for preferrential equity raise to fund Dubai capex in future

3/ Guiding for 40% growth on conservative basis for next 2 years

4/ Promoter clarified that they gave pre ipo stake at cheaper valuation to a strategic investor. This makes sense as the growth in revenues were 4x within an year (18cr to 72cr) once the investor got on board

5/ promoter mentioned that their business is niche and any new player will take atleast 2 years to get approvals and quality control from clients

Call was attended by multiple fellow valuepickrs @ayushmit @DEBASHISH @Rahil_Dasani etc

Hi everyone!
After recently joining the forum, and soaking info from all sides – I rebalanced my portfolio and would like your insights on it. As a young 22 beaming with passion for deep diving into equity research & technical patterns, my psych rubs on my portfolio with small cap/ midcap dominance and once in a while I dabble in large caps like TVS Motors if the charts get me excited enough ( getting rarer lately ).

I pick shares using a bottom up approach, first ensuring strong fundamentals with revenue growth visibility & margin expansion with capex/expansion plans. Then I time my entry based on technical aspects such as VCP breakout with volumes/ Stage analysis/ EMA 200 support levels. I try to avoid very high PE shares, and below 30-40 levels is my sweet spot which helps me sleep better at night.

Since most of them are small/ mid caps, I prefer to take a small loss and exit before it snowballs into larger ones, and let the winners ride. If the same share forms a better base later on, I re enter. This approach has its own merits and flaws, but seems to have worked for me after a lot of trial and error.
I’d be happy to try other approaches with merit, so feel free to add.

Portfolio : Currently having positions in 10 companies – with a medium-long term outlook. I am trailing most of them with EMA 50 stoploss, and will be actively tracking AGM notes and Quarterly results to see if the mgmt walks the talk, and scale up on further conviction.

Ahluwalia – 13%
Vimta – 13%
TCPL – 9%
ACE – 11%
Usha Martin – 13%
Shivalik Bimetals – 9%
TVS Motors – 7%
HG INFRA – 7%
LINC – 11%
Mazagaon Dock – 7%

Rationale for picks:

1. Ahluwalia and HG Infra both had 20%+ revenue guidance with healthy order books, and neutral margin outlook. I am a bit divided in this position, since I read that Infra segment usually faces a slowdown before elections, hence closely watching for exit if support breaks. I genuinely believe this sector is poised for good times, with growing infra & urbanization developments in India.

2. ACE is a proxy to the Infra play. Mgmt seemed very excited about demand outlook despite Monsoon season, with very strong commitments on margin expansion and topline doubling in 3 years. Seemed like a no brainer, eager to see capex and volume variables for this quarter.

3. Vimta – This is an early May position and honestly I wasn’t very sure about it but the share was at a well tested support with decent fundamentals. Little did I know it would grow itself to become the largest position in my portfolio. Q1 had bullish mgmt comments with plans to double capacity, and 2% margins expansion with revenue target of 500 cr for 2026 ( currently 315 cr ), which further rocketed the share to ATH – trailing this one as I am not sure if there’s much fuel left.

4. TVS Motors and Shivalik Bimetals are auto sector plays. TVS might be the only large cap I own right now, it gave a solid base breakout, and fundamentals seemed on right track with 2 wheeler demand rising with rural recovery and expanding margin guidance. It was a tracking position initially, which for scaled up recently when the share seemed to be taking support above 20 EMA.
   Shivalik – smart meters – high capex – auto sector tailwinds – EMA 200 – connect the dots.

5. LINC was a Pentonic play purely, with recent breakout from downward trend – will need to track this more actively every quarter to see if mgmt plans execute well.

6. Usha Martin – I liked the part about increasing margins from premium products and 15-18% revenue growth, the price chart was like a ant climbing a mountain – always like such treks with EMA 20 support.

7. TCPL Packaging – was very unsure about it since mgmt had pessimistic tones on fmcg volume growth, but the charts very giving a fresh breakout. Held onto a trailing position and voila! I still fail to get my head around how it went to where it is today.

8. Mazagon Dock – Latest entry at cup and handle breakout after a long upmove previously. I missed the initial rally in shipbuilding sector despite tracking it for 1 year. Call it a revenge trade haha but it seems to be playing out well – will trail it as long as it keeps me in trade. Mgmt seems positive about fresh orders potential – will need to track how it plays out though.

That’s all folks! I know it isn’t perfect – and I am just a beginner. I recently exited Mayur Uniquoters as it took out my stop loss, and there are many more mistakes that I did. However, keeping a tracking entry initially helped me to limit my losses and ensure my winners more than cover for the losses.

I am not very hopeful with current valuations, but earnings growth is there – so keeping a trailing stoploss to see where it leads. Feel free to add your own insights/ suggestions on any positions you are interested in – would be happy to learn from your experiences!

Thank you!

Recently, the stock of Garden Reach Shipbuilders have had a good enough run-up, tempting everyone to ask whether there’s more to it or is the ship going to sink?

Here are some highlights from the concall, which indicates that although there would be short-term hiccups, the long-term story for the company remains intact:

1. The company’s order book as of 30th June 2023 stood at Rs 24,546 crore, which consists of 6 projects. This entire book is expected to be completed by FY27. For a context, its Q1 FY24 revenues stood at Rs 756 crores.

2. With respect to the immediate bid pipeline for Q2 FY24, the company expects bids for 3 projects worth Rs 4100 crore, where it feels itself to be a strong contender. Further, RFPs for 3 more projects worth Rs 7500 crore are expected to be online by CY24.

3. RFP for one specific project i.e. 8 Next Generation Corvette will come out in the latter half of FY24. That project itself would be worth Rs 36,000 crores. Also, the RFP for next generation destroyer would come out in the next 4-5 years, whose order value alone would be more than a lakh crore.

4. The combined shipbuilding program of the Indian Navy and Indian Coast Guard over the next 15 years indicate that they would place orders of more than 150 warships in the coming years.

5. As the current order book gets executed, the company has opportunities available in the domestic warship building, export opportunities, ship repair, and diversified products.

6. The conventional PAT margins in the shipbuilding industry are between 7.5-8%. The next 3 years being peak revenue years, the company is confident of maintaining these margins.

7. In the shipbuilding business, the maximum revenue accrual is when the ship crosses 40% of the construction and reaches 60%.Hence, the revenue accrual is not linear in shipbuilding, and it depends on the type and phase in which the ship is under construction. And currently, ships in one of the company’s projects with unexecuted orders worth Rs 13,000 crores have crossed 40% construction levels.

8. The company’s ship repair business is in the nascent stages and forms just 1.5% of its revenues. However, the company is looking to enhance revenues by at least 4x in the next 3-4 years.

9. The company’s core focus will be domestic warship building, but it will also foray into building autonomous vehicles and green energy platforms.

10. Q1 FY24 results were very good. The margins expanded 30 bps YoY and the company registered its best ever PAT. The company says FY24, FY25 and FY26 will be peak revenue years.

To Summarize:

Orderbook as of Q4 FY23 stood at Rs 25,110 crores, whereas by Q1 FY24, it stood at Rs 24,546 crore. At the end of FY24, the company aims to maintain an order book of Rs 24,000 crore plus.

On concerns of order book getting depleted by FY27, the management guided that Indian Navy and Indian Coast Guard in the next 3 years will come up with RFPs worth over Rs 1 lakh crore, so there will be enough on plate for everyone.

I dont get that , where will the addiitional growth that they are guiding(25-30%) come from as they arent planning to increase retail stores in near futures would it from channel and enterprise along with increasing the average ticket size on the retail front?