Skipper Ltd., distributing Power and Water, Is it a moat in making?

Hi,

This stock came under my radar a few days ago and started reading about it. I was about to start a thread on the same so thank you @hssodhi198 for taking this initiative.

Now coming to the company, I have a few points to add:
1. In the power transmission sector, the line of work is as follows:

a) PGCIL or one of the state discoms come up with a tender for a line which is generally an EPC project. The tender is on L1 basis after come technical requirements are fulfilled. This company is new to the EPC part of the business although they have been the suppliers for a long time. So for them to expand in this space they need to get sufficient experience to participate in tenders. Some companies generally take the JV route if they are not qualified, so we need to know how is the management planning to do this.

b) The EPC business is a very slow process with many extensions and delays in payments from the discoms. This is effect the working capital of the company if they plan to expand further in this space.

1. General procedure for finalizing a tower for full fledged manufacturing consists of a on ground test where in the actual tower is made and forces are applied on the tower to know if it can withstand the loads. I donot what capacities are present with this company. This is also the area where companies like KEC have an advantage i.e. they have manufacturing, testing as well as EPC business and they have been running for a very long time. So if we are bullish on electrification of India why not invest in market leaders, where the scope of additional capex is also limited.

2. The segment of PVC pipes for water and angle sections for power transmission are totally unrelated. What is the rationale for selecting this combination of businesses?

3. To whom does the company currently sell their power transmission sections to? I have had a rough go through the annual report but couldnt find any names. If information is present on this please share.

Cheers!!

Disc: I do not hold any stocks of this company. Currently tracking it closely.