Skipper Ltd., (Power and Water) a moat in making?

Here are the key trackables as per my analysis of the recent con-calls:-

• The company expects margin improvement in the polymer business as volumes increase.
• The company is positive about its future outlook and expects a revenue growth of over 25% CAGR for the next three years.
• The company aims to reduce debt and improve its margin profile.
• The company’s capex plan for the year is Rs.75 Crores. (As per Aug-23 concall)
• The order book stood at Rs.5372 Crores, the highest ever in the company’s history. (As at Aug-23)
• The company secured new orders worth Rs.1215 Crores in Q1 FY2024, registering a year-on-year growth of 200%.
• Engineering segment guidance is 12% OPM and polymer segment is in double digits going ahead (As per the CNBC interview on 8th Nov 2023)
• Finance cost as a % of sales will come down each year. That is what the management is targeting. Last year in Sept 2022 it was north of 5%, this year it is 4.5%. hence the debt level should be looked at from this lens.
• Order book is executable for 15 to 24 months

Growth Drivers:-

1. The domestic T&D environment is showing signs of a strong rebound.
2. Skipper is leveraging the China plus one trend and witnessing a surge in global enquiries.
   3.The company expects good traction in the international transmission line market.

Disc: Invested