– Forensics and the art of triangulation

Highlights and notes from the conference call that raised concerns.

Opening remarks

The CEO repeatedly emphasizes that they manufacture a “mission-critical,” “life-critical” product for turbines operating at 30,000 feet, making India proud or proudly manufactured in India. He concludes by suggesting that the current financials/profitability might appear deceptively inexpensive and shouldn’t be over-interpreted.

Remember the movie Drishyam?

Illusion of truth?

Analyst Q&A:This is where things start to get interesting

The CFO was asked about Gross Margin, but he repeatedly discussed EBITDA margin. Even the comments on EBITDA lacked substance.

This is really odd: Why would an analyst/investor act like an appointed cheerleader? And yet again, the promoter seizes the opportunity to reinforce the Halo effect.

Cheerleading continues: Creating an illusion/hope by drawing parallels with the best in business. Moreover, promoter continues bragging (and needless mentions of its relation to India) to fuel the availability heuristic and establish correlation where none exists.