Though the company may not be transparent about raw material cost (they could argue they would keep it confidential to have an edge over competitor), they should let the share holder know what are their arrangements (contracts) to have a uninterrupted supply of Quartz in critical cases just so the production is not stopped because of raw material issue. The company should also disclose how many suppliers they have. We should pursue to gather it.
We should also request the most updated capacities for both Granite and Quartz.
I think its good if they have excess capacity (which I think they do) for the increased demand since they have added more dealers recently. Considering the current OPMs, if they can leverage the current idle capacity to the increase in the demand without additional capex its a boost for the profitability.
@varadharajanr, is there a way if you could find out how much of raw material CaesarStone sources from India , from your hedge fund contact that you have?
I have seen their report on CaesarStone, can you also find out if they know there is any other Quartz exporter from India than Quantra? Because the suggests they have researched most Quartz imports to US.
I think we are all too over concerned about one single “Chettinad” supply while the consensus is Quartz is easily available. But good to understand if they have only one raw material supplier and why Pokarna thinks Chettinad is better, does Chettinad have high quality raw material over others or something else?
With union government’s push for make in India and transparency and efficiency in allocating the natural resources, the license for Pokarnas Quartz mine should be processed faster which would have taken longer otherwise.
| Subscribe To Our Free Newsletter |
