Galaxy announced a fair set of numbers today and seems to be making significant progress on the CAPEX front (CWIP up to 26 Cr for March ending, out of their assumed CAPEX of Rs. 35 Cr).
Providing a summary for everyone on this thread (and myself to refer back to):
Background: company was founded by Mr. Vinod Kangsara (passed away in 2019) – current main promoters are his wife (Indiraben Kangsara) and daughters (Shetal Devang Gor and Tuhina Bera) – who now seem to be NRIs and aren’t actively involved in the business operations. CEO is Mr. Nitin Santoki – who seems to be Rajkot based with a strong presence in the industry (no information on his shareholding). It seems that Mr. Nitin’s family has other companies in associated fields of the industry (common in auto ancillary businesses, wouldn’t consider it to be a corporate governance issue – refer to the link for Adico group below).
Catalyst/Trigger: Change in management post 2019, might have triggered a new approach to the business(speculatio). Dr. Devang Gor who is a Chair at the Department of Radiology in a leading healthcare network in Pennsylvania, USA was appointed on the board in August 2019 after completing an Exec MBA from Temple University (potentially to groom him for this role?).
Key business trigger seems to be a new product development as mentioned by Mr. Nitin in his interview (https://www.youtube.com/watch?v=ygyf4W54XCU&t=1s) – where they are manufacturing roller bearings with a hub casting attached. This saves their customer the time, effort and the cost of otherwise attaching the hub casting separately to the product.
It seems another competitor offering a similar product is Orbit Bearings (also Rajkot based), who has grown significantly by being the first taper roller bearing company to manufacture these bearings with a hub casting (Cylindrical Roller Bearings | Truck Axle Bearings | Taper Roller Bearings | Truck Hub Bearings | Orbit Bearings India Pvt. Ltd.). Orbit Bearings has scaled significantly and did a revenue of Rs. 624 Cr in 2022 with a PBT of Rs. 151 Cr. Orbit has a capacity of 10 Million pcs per annum, and it’s interesting to note that Galaxy has decided to set up a plant which takes their total production capacity to 9.5 Million per annum (in Phase 1)! Other smaller competitors also seem to be equally profitable (Turbo Bearings does a Sale of 99 Cr with a PBT of 27 Cr).
Has anyone studied the bearing industry in greater detail to check how they compare with SKF, Timken, Schaeffler?
https://www.adicogroup.com/international/group-of-companies.html
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