Force Motors AGM was quiet detailed. Some KTAs:
→ Indian economy continues to be resilient in the face of a global slowdown. Company expects demand for it’s products to continue and current volume run rate is sustainable.
→ Management is looking at 10-15% volume growth CAGR. When questioned whether company is being conservative,they responded by saying that it’s better to be pessimistic than be very optimistic.
→ Seriously looking at Defense as a key growth driver.
→ Export markets like Middle East,Africa were adversely affected due to Covid. However,everything is on track now thus the accelerated pace of exports. Africa is a high potential market for the company from both existing and new platforms.
→ Company’s efforts to rationalize on cost side & improve profitability have started bearing fruit. Focus will be to leverage market position and improve on profitability further.
→ While EV is the future,management doesn’t foresee any adverse impact for many years to come. Yet company is readying for new products in this basket. Overall,1000 cr will be invested over the next 3 years on new product development.
→ Breakeven of JV was delayed by 3 years,mainly due to Covid. Fy24 should end at breakeven & contribution to bottomline should accrue from Fy25. 500 cr revenue here is a low hanging fruit.
Almost all participants asked good questions. Some questions on tax rate & concall weren’t taken up. Overall,the management seemed very happy with the company’s progress in the last year or so & was confident of sustaining current numbers.
Disc.: Invested. Views are biased.
Subscribe To Our Free Newsletter |