Nitiraj Engineers: Electronic Weight Machines

Management Comments on poor Q1 FY25:

Q1 FY25 presented challenges for our performance, primarily due to two significant factors.
First, the election period led to the suspension of tenders and orders, creating a temporary
slowdown in our business activities. Second, our ongoing factory expansion efforts required
substantial resources and focus, which, while crucial for our long-term growth, also impacted
our short-term performance. Also first quarter for us is always lean due to lower institutional
demand.

However, despite these hurdles, we achieved notable operational milestones. One of the key
highlights was the successful launch of our new product in the security and automation sector:
the GSM Shutter Alarm. This innovative device is designed to enhance security by triggering an
alarm and automatically placing phone calls to pre-saved numbers if any attempt is made to
open the shutter. The trials for this product were highly successful, indicating strong potential
for its market adoption.

In addition to the GSM Shutter Alarm, we made significant advancements in our drone
technology. We successfully manufactured two drones and conducted field trials, both of which
yielded positive results. These drones represent a strategic step forward in our technological
capabilities and position us well in a rapidly growing market.
Moreover, our international endeavours are showing promise, particularly with our projects in
Germany, which is progressing steadily through the pipeline. These projects are expected to
open new avenues for growth and further establish our presence in the global market.
Overall, while Q1 FY25 posed certain challenges, our operational achievements have laid a solid
foundation for future growth. We remain optimistic about overcoming the short-term obstacles
and are confident in our strategic direction moving forward.

My comments:

1. I feel the company is heavily dependent on government orders. There was a total collapse of sales to 4cr from 52 cr in the previous quarter. All the sales momentum going to drain.
2. No progress on expanding to other states in the last 3 months.
3. No further progress on export orders, they have still made the same comment about Germany.

Maybe they will get back to normal business in the next quarter. But there is still going to be a price correction. It can easily touch 200 DMA, a 25% correction from here.