The pharma major’s consolidated net profit jumped 46.55% to Rs 510 crore on 22.47% increase in revenue from operations to Rs 2,338 crore in Q2 FY25 over Q2 FY24.
Posts in category All News
Investing Basics – Feel free to ask the most basic questions (09-11-2024)
I have query which is off the topic of investing basics…but may be related to idea ,on market intelligence services.
Anyone know, if There is/are any indian service provider who offers polymer market insights.
- Insights by icis – report looks like this.
2.Insight by S&P Platts – Report looks like this
Purpose of asking is to explore an idea, if India has such service providers.
Most of these service providers at present are British/Americans with extremely absurd terms of use.(even though you paid for subscription, if u discontinue subscription you have to delete all the past data, even the data from last 10-15 years 
you heard me right, one has paid but data is their property 
)
Pricol limited – OEM automotive (09-11-2024)
Pricol Limited Earnings Call Summary – Q2 and H1 FY25
Financial Performance
- Q2 FY25: Revenue from operations reached 6,500 million with an EBITDA of 871 million (13.4% margin). Profit after tax (PAT) was 450 million (6.93% margin), resulting in an EPS of 3.70 Rupees per share.
- H1 FY25: Total sales were approximately 12,530 million, with an EBITDA of 1,677 million (13.39% margin) and a PAT of 906 million (7.23% margin). EPS for the half-year stood at 7.44 Rupees.
- The company reported zero long-term borrowings and maintained comfortable cash reserves as of September 30th.
- Year-over-year growth for both the quarter and half-year was around 15.5%, despite a slowdown in the automotive industry during Q2. EBITDA grew by approximately 24% for the quarter and 23% for the half-year.
Margin Guidance
- Management aims to maintain an EBITDA margin of 13-13.5%.
- Margins are expected to improve by approximately 50 basis points with the resumption of exports, which were significantly lower than expected this quarter due to US election-related factors.
- Wage increases implemented on July 1st have impacted margins, but productivity improvements are expected to offset this in the future.
Business Segment Performance
- The company experienced muted sales in the automotive industry during Q2, reflecting a broader industry trend.
- Exports were significantly weaker than anticipated due to policy changes under the new Republican government in the US, impacting both revenue and margins.
- Disc brake production has commenced, with supplies to six manufacturers. A ramp-up phase and significant volume increases are expected in FY26.
- Battery management system (BMS) products are still in the testing phase and have not yet generated revenue. Management is cautious about the BMS market’s fragmentation and unclear trajectory.
- Smart cockpits and connected vehicle solutions are showing traction and are considered a significant growth opportunity.
- Mechanical clusters currently contribute approximately 30% of revenue but are expected to decline, with LCD and TFT displays gaining prominence.
Future Guidance
- Management maintains its target of reaching 3200 crores in revenue by FY26 through a combination of organic and inorganic growth.
- The company is actively exploring inorganic opportunities in the railway and defense segments to drive higher margins and growth. However, these initiatives are in the early stages.
- Pricol is open to acquisitions in allied areas and is comfortable raising up to 300 crores in debt to fund strategic acquisitions.
- Capital expenditure (CAPEX) for the full year is expected to be around 200 crores, consistent with the previously stated plan of 600 crores over three years. The CAPEX allocation includes building new plants, expanding existing facilities, upgrading production lines, and investing in new machinery.
Key Risks & Industry Outlook
- Muted demand in the domestic automotive industry is a key risk, with Q3 FY25 anticipated to be particularly weak.
- Uncertainty surrounding export demand due to US policy changes poses a challenge to revenue and margin projections.
- The slow adoption of EVs is not a significant concern as Pricol’s products are propulsion-agnostic. The company is collaborating with various EV manufacturers.
- The fragmented BMS market presents challenges in predicting future revenue.
Disc: Invested
Zen technologies – A micro cap in the defense space! (09-11-2024)
One correction to Jitendra’s post , and few more points
1- Correction – the fresh orders expected in H2 FY 2025 (until 31st Mar 2025) are for 1200 crores (not 3500 crores). 3500 crores is their order pipeline.
Other points
1- Expect the receivables to come down significantly in this and next quarter. In the current Trade Receivables amount, major chunk is from recent times.
2- Company is confident of clocking at least 900 crores this year. Despite a lot of questions around 500 crores is already done in the first two quarters, so the H2 should be just 400 crores?’, the management stuck with their guidance. They simply do not want to over commit and under deliver (like last year).
3- The management believes that they would be able to clock 50% CAGR post current year for the next three years. The EBITDA would be 35% and PAT margin 25%.
4- The management believes that their products in Simulators category is top notch, and even in the ADS (Anti Drone Systems) they are very competitive.
5- They are primarily an IP company. They get 85% of goods from suppliers and only 15% is manufactured by them. This asset light model helps them keep fixed costs in check, which helps them during dry order periods. They would have similar model in US.
6- The company is keen on acquisition but does not want to rush into it. Mr. Ashok emphasized that he would be extra careful putting any money and not do acquisition just for the sake of it.
Overall, my sense is that the company is on strong footing. They trust their skills and products. While the Ukraine-Russia war may end because of Trump, the need/market for the simulators, anti-drone systems, remote controlled weapons and surveillance is only going to go up. Key monitorable would be order book; they need to get wide & deep traction for their products and build many years’ worth unexecuted order pipeline.
Cheers,
Krishna
Ola Electric – Full Stack EV play? (09-11-2024)
I have been tracking OLA for long and wanted to buy it even at 100 but with all the negative market sentiment waiting to see how much can price go down.
Looks like the long-term story is still intact and Ola will be able to cross this rough patch. At this price point and all the negativity priced in this looks like a good time to buy.
Dic: Planning to enter soon.
Drop-Off in Democratic Votes Ignites Conspiracy Theories on Left and Right (09-11-2024)
There is nothing suspicious about the shift in Democratic fortunes. But partisans from across the spectrum are questioning the results, for different reasons.
