But with the world going into recession, will there be enough demand for the existing capacity, let alone the increased capacity.?
Posts in category Value Pickr
Amararaja Batteries Limited: Powering Ahead (26-09-2022)
Company announces merger of plastic division of Mangal Ind into the public co. I think the acquisition is very fair (592 cr. being paid in shares based on today’s price on FY22 sales of 569 cr.). My notes from today’s call is below.
26.09.2022 (merger of plastic division of Mangal Industries)
- 1.22 cr. shares to be issued to promoters for merging plastic division of Mangal Industries Ltd. with Amara Raja. The plastic division did sales of 569.4 cr. in FY22 (412 cr. in FY20, 421 cr. in FY21). 17% EBITDA margins and 10% PAT margins. Asset turnover is 2.5x
- CMP: 485 (valuation of 591.7 cr.) as on 26.09.2022 (net debt is 99 cr. and will be taken over by Amara Raja). Valuation exercise has been done on a relative basis where plastic division of Mangal Industries has been valued at a 25% discount on P/E vs Amara Raja
- 10% of raw materials in their current operations is plastic components
- 65 equity shares of Amara Raja is being issued for 74 shares of MIL
- Caters exclusively to Amara Raja
- Capacity of 37’000 MTPA (running @90% utilization) with 150 injection molding machines at 3 locations (Chittoor, Tirupati, Petamitta). Petamitta facility will be moved to Chittoor and Tirupati
- Backward integration: Will bring plastic molding capabilities in-house
- Will improve margins, bring recurring annual synergies of 5-6 cr. and is EPS accretive from first year
- Expected to finish in 12-14 months
- Low voltage components in an electric vehicle is serviced by an auxiliary battery which is lead acid based. Confident of growth in lead acid batteries for at least 15 years
- For lithium ion business, mega scale plant will be setup using own balance sheet and bank debt. Currently not looking for any strategic investors
- Seeing some shift to lithium ion batteries in telecom business
Disclosure: Invested (position size here, no transactions in last-30 days)
IRB INVIT TRUST- new game in the town! (26-09-2022)
Post 237 above has the calculator.
Capital reduction needs to be shown as the adjustment to the Investments value in the books of accounts.
TCS – A very strange case for investing! (26-09-2022)
This topic was automatically opened after 8 hours.
Rajratan Global – Focused Tyre Beadwire Company (26-09-2022)
At this point it is trading at PEAK MARGINS, PEAK VALUATIONS. Bull, Base and Bear scenario for perspective is as under
Rajratan Global – Focused Tyre Beadwire Company (26-09-2022)
At this point it is trading at PEAK MARGINS, PEAK VALUATIONS. Bull, Base and Bear scenario for perspective is as under
Vedant Fashions (Manyavar) – Niche Branded Retail (26-09-2022)
they have competition definitely, some of them are jahapanah, swayamvar to compete with manyavar and neeru’s , taneira to compete with mohey. but, undoubtedly vendant fashion is too far in margin level and it’s tremendous effort from team that margins are sustainable at this level.
Vedant Fashions (Manyavar) – Niche Branded Retail (26-09-2022)
they have competition definitely, some of them are jahapanah, swayamvar to compete with manyavar and neeru’s , taneira to compete with mohey. but, undoubtedly vendant fashion is too far in margin level and it’s tremendous effort from team that margins are sustainable at this level.
Dish TV 10 bagger stock (26-09-2022)
at 20 Rs it is extremely overvalued and from 15 Rs it looks like a 3 bagger to you? So, how come it is extremely overvalued at 20 if you have a target price of 45 rs in your mind.
