Good updates

1.https://www.bseindia.com/xml-data/corpfiling/AttachLive/04139bb1-3c75-4114-8755-1c12f8434ac0.pdf

DCX Systems Limited has received an industrial license for its subsidiary, M/s Raneal Advanced Systems Private Limited, to manufacture microwave submodules, avionics, defense electronic equipment, radar systems, and EW systems. The license will be valid for 15 years and falls under the highest level of security. No withdrawal or cancellation of the license has been reported.

And

2. DCX Systems secures an export order from Elta Systems in Israel for RF electronic modules valued at ₹154.80 crore.

Opportunity cost has been something which is quite evident in the stock price, which has mostly been sideways or on a one way downside that being said on valuation front Ugro is available at a solid cmp/bv of 1.5 which is reasonable given the headwinds in NBFC sector facing heat from the increased interest rate scenario.

Now, as of yesterday the fedresv has decided to cut rates by 50 bps, possibly RBI will also weigh in on a rate cut by nov mpc meet, since the inflation in india is now also in tolerance band. Ugro also recently floated a 15cr NCD issue through ppo (operational issues?)

That being said, interest rates as such can only give a tailwind and the internal efficiency ratios lies under management’s control. A respectable cmp/bv for a company like ugro would be 2.2 to 2.5 but only if the roce picks up in the upcoming Q.

Looking at overall trend of decrease in the net loan origination if let’s assume the election season had nothing to do with the overall performance of the industry we might see a slight uptick in the NPA for upcoming quarters since if mgmt has decided to halt loan disbursement they have sensed that the ongoing loan disbursement might be riskier given the high interest rate scenario.

Disc: holding, biased.