Samarth’s Portfolio & Learnings

In past few days or say weeks got little busy in some family event due to which I couldn’t update my blog but hereon I’ll try to share my thesis as often as possible and update it as well.

Time Technoplast is a company which I invested with when the current leader Mr. Bharat ji Vageria came in had visited there facility back when Anil Ji was heading the company and looking at the corporate history of the company, it was always a technocrat company bringing in newer technology in IBC and Chemical Packaging space but took a hit in terms of poor capital allocation & management not walking the talk, but with coming up of new leadership this problem started to get resolved and focus of new Mgmt started shifting from low margin established product range to better Margin Value Added Product Segment, easing out of corporate structure, selling of non-core assets in form of land parcel at Karnataka on which earlier mgmt planned to do real estate business.

One Mental Model I use is
Great Business – High/Better Margins & High/Better Turnover
Good Business – Better Margins & Low Turnover
Okayish Business – Medium Margins & Better Turnover
Gruesome Business – Low Margin & Low Turnover

So when Management shift from Okayish Business to Good Business Markets starts to appreciate the fact… as value creation starts to get better.

Below I have shared my thesis in the form of small write up
Time Technoplast Limited Report.pdf (1.1 MB)

On 16.04.2024 in blog of Time Technoplast I wrote

Time Technoplast is a medium term bet and the internal business is cyclical in nature but right now the company is in sweet spot because

1. Chemical sector is slowly gaining traction in terms of production and still major revenue contribution for the company comes from IBC so now establish business will also post good numbers.
2. In India on 35 cities are covered under CGD and still many part of India is dependent upon cylinders for there cooking fuel so that is not a problem and since composite cylinder can store more fuel than traditional type 3 or metal cylinder it will gain traction in HORECA industry with time so one can check out of close to 2 to 3 crores (damaged) cylinders that come back what is the proportion for type 4 cylinder going back to the market.
3. Once the new capex is completed in this year company will also enter the retrofitting market and that has a huge potential as only maruti a single auto company has committed to produce 4 lakh CNG vehicles plus autorickshaw had also this demand because current cylinders are heavy and stores less gas.
4. Now, most important of all as company was a technocrat from very beginning but intresting thing is now Bharat ji is walking the talk and not just committing high things but actually delivering the result as seen in last year where company didn’t receive money from divestment of there offshore business through which they planned to add new capacity for CNG cascade but still added any how without increasing further debt and in the established business company is doing only maintenance capex.