While I didn’t get any response to the email queries, the mgmt has given some indication in the recent concall.
Posts tagged Value Pickr
Godawari Power – Any Trackers? (23-05-2024)
Q4 Concall highlights
Products | FY’24 Production | Fy’25 Guidance | % Change |
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Iron Ore | 2.3 | 3 | 30% |
Pellets | 2.6 | 2.44 | -6% |
Sponge Iron | 0.59 | 0.594 | 1% |
Billets | 0.475 | 0.5 | 5% |
Ferro Alloys | 0.08 | 0.08 | 0% |
Rolled Products | 0.2 | 0.325 | 63% |
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Shareholder Payout
Buy Back worth 200crs
Dividend of 125crs -
Total Capex in FY’25 700crs & FY’26 1000crs:
Power 63crs (this will help reduce the power cost)
Beneficiation 176crs (this will save transportation cost for the company)
Pellets 568crs (should be done by Q1’26)
Steel Plant 6000crs (this should start after getting Environmental clearance (EC) will happen over 3 years time) -
Product prices have gone up 10% since Holi on an average. Pellet Prices have gone up from 10.5k/t to 11.3k/t for industrial grade pellets & higher grade is selling at 12.5k/t. Company presently has a 50:50 product split.
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Post the capex in mines & pellets the product mix will change in favour of high grade pellets (75:25). Company expects mining output to increase from Q4’25. Higher grade pellets are at a prem of Rs 1000-1500/T to Industrial grade pellets.
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Cost price advantage due to older royalty is Rs 3400/tonne.
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Demand for pellets will remain strong due to DRI capacity coming on stream in a few months time.
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Ferro Prices have gone up and are likely to sustain at higher levels due to disruption in Australia’s South32’s mining operation. It will take 18 months for the supply to flow back to the market.
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Currently only one mine is operational and all the capex will is happening at that mine. The company has stopped production at the second mine due to inferior output. Company is planning to set up a beneficiation plant at the second mine site. They have already started the EC process. The production from the second mine should start in FY’28.
My Two bits:
- For GPIL iron prices are the most important factor that we should track. FY’26 will be a great year for the company as it will be able to double its pellet plant.
- Biggest advantage that this company has is the mines under the old scheme. This leads to a cost advantage of ~Rs 3000/T and if the price of Iron Ore goes up the advantage will only increase.
- Company should post a EBITDA margin>25% (company has guided for 24-25%).
- Revenue for FY’25: 6000-6200crs & EBITDA ~1600crs.
- FY’26 should be a breakout year for the company.
- Capex can be easily funded through internal accruals.
- Company is looking to move up the value chain by setting up a HRC plant (Steel Plant) of 2MT.
- Mines auctioned under the new royalty regime will also start coming on stream in a couple of years time.
- Company is likely to keep rewarding its shareholders through BuyBacks & Dividends in the future despite higher capex.
Disc: Invested
Infosys Limited – Are we getting a discount or no? (23-05-2024)
“Infosys AI strategy”
https://www.youtube.com/live/6Wc_obyUiJM?si=8-Mfmm9Tu2ZM94KQ
Bajaj Healthcare – API and FDF Manufacturer (23-05-2024)
Hello can someone share their views why stock is in downward trend
Indian Defense Sector (23-05-2024)
Discl: Invested from lower level… not a buy sell recommendation. please do your own assessment before you take any buy sell action
Deep Industries (DIL) (23-05-2024)
With another 25-30% sales growth year along with improving margins and new segments being added, all backed by robust industry tailwinds, the future seems promising for Deep industries
Deep Industries (DIL) (23-05-2024)
Q4FY24:
• Order book of INR 1210 crores, reflecting a 12% year-over-year growth.
• Innovating into Charter Hire of entire Gas Processing facilities
• Owns & Operates 9 Workover Rigs with capacity ranging from 30T to 100T, 5 Drilling Rigs with capacity of 1000Hp.
CONCALL NOTES:
• We have added two new drilling rigs in previous quarter of which one has started operation in February 2024 and the other has started operation recently in May 2024. So both put together, it can add INR 5 crores a month going forward.
• Management has delivered on revenue growth guidance of 25% and EBITDA margins of 42% (including other income)
• BIDDING PIPELINE: Highest ever bidding pipeline – 1000cr (This is generally 500crs).
Our routine business has exceptional response in almost out of INR1,000 crores, almost INR700 plus crores is from our regular services, including rigs, compression gas processing and integrated jobs. I would say more than 70% 75% is from our current services portfolio itself.
NEW SEGMENTS: And there are a few good opportunities. We are working on it, which includes production enhancement contracts and enhanced oil recovery business which we believe can change the table, so we have started bidding those opportunities as well.
• DOLPHIN OFFSHORE: We anticipate the revenue stream to commence in the first half of FY '25.
For barge, our expectations are EBITDA around 60%- 65% for that particular asset. On full year basis, revenue of almost INR90 crores to INR100 crores is expected from that particular barge. 65cr should be for FY25
OTHER SEGMENTS: We have begun exploring platform supply vessels opportunities in both local and international markets. Early indications suggest a substantial demand for PSV services.
And in addition to PSVs we are also looking for some diving support systems, which we already have to mobilize. So as a strategy, currently, we are focusing on 1 asset to put in operation, 1 asset will start operating, we’ll add other assets to get into operation and we’ll definitely, going further, we’ll acquire a few more assets as well.
• INDUSTRY TAILWIND: In February 2024, Prime Minister announced that the country is expected to see investments worth USD 67 billion in the gas sector over the next 5 years to 6 years. This focus on domestic natural gas production is expected to attract significant investments given the goal of the increasing gas share in the primary energy mix to 15%. These developments are reassuring growth drivers for our company
• Our ex-goodwill adjusted ROCE has improved to 12.42% from 10.27% previous year. And our ex-goodwill adjusted ROE has improved to 11.83% from 8.18% previous year
• MARGINS TO IMPROVE: our margins would definitely improve as the year passes. And we have always been maintaining our EBITDA above 40%. So yes, we are very much confident that with new service mix added into our revenue stream, this margin will tend to improve
Dolphin margins to be 55-65% range so FY25 Margins will be better than FY24 as dolphin sales kick in
So, in FY '25, we expect it should reach 45%. And in FY '26, it can further improve as well. (Including other income)
• GROWTH GUIDANCE: “Minimum’ 25% sales growth. Orderbook is 1200cr with 2.5-year execution timeline. So, 1200/2.5 = 480 (that’s 12% growth over fy24 revenues of 427) + Dolphin offshore revenues of 60-65cr = 540-545 cr sales in FY25 at MINIMUM. Any new orders will further increase the growth
• Didn’t get business for Kuwait tender.
• INR196 crores is the total investment. And the other income is largely interest and mutual fund income
• We are operating currently for more than 40 different contracts
Unemployed investors portfolio (23-05-2024)
Please share a brief rationale too if possible
Advanced Enzyme Technologies Ltd – The Enzyme company (23-05-2024)
Q4FY24:
• EBITDA MARGINS – 35% (33% QOQ, 32% YOY)
• FY24 VS FY23:
Bio-Processing segment - In this segment, food business stood at ₹ 776 million delivering a growth of 30%.
Domestic sales grew by 21%. The revenue grew by 9% in Americas, 12% in Europe and rest of the world registered a robust growth of 78%, while degrew by 3% in Asia (ex-India).
• Q4FY24 VS Q4FY23:
Bio-Processing segment - In this segment, food business performed well, it grew by 33% to ₹ 197 million on y-o-y basis during Q4 FY24.
• The revenue increased by 32% in Americas, 31% in Europe and 14% in Asia (ex-India). While it registered a de-growth of 29% in Rest of the world. Domestic sales grew by 3%.
• Q4 VS Q3 - The revenue grew by 20% in Europe, 50% in Asia (ex-India), while it de-grew by 15% in Americas and 24% in rest of the world. Domestic sales grew by 1%.
• 14 Food Enzyme Dossiers filed with EFSA (13 last quarter, 12 yoy), out of which positive R&D opinion is received for 9 Dossiers & 5 are under evaluation. (9 & 4 qoq, 4 & 8 yoy)
• 8 GRAS Dossier evaluated by US FDA (7 qoq and yoy), No question letter received for 7 Dossier & another 1 Dossier is self-affirmed (5 and 2 under evaluation qoq, 4 and 3 yoy)
CONCALL NOTES:
• API and Probiotic mainly supported the growth in human nutrition business.
• Input cost more or less is stable in terms of raw material prices and other prices, and we expect the same to continue.
• Margins should improve and we expect it to improve further because we expect like somewhat growth has to come back even from the US now and that will really improve.
• Guidance – Double digit sales growth (13-16%) – US business to improve this FY – New products to drive growth.
US business should growth at least 10% for the next two years.
• US NEW PRODUCTS: we introduced a couple of segments like on the weight management and other areas and the sugar management and those are the products which are going to drive the growth for this year as well. Customers are nutraceutical companies.
• Human nutrition business Q4:
51.3cr in India and international sales is 51.1cr
Within India - Pharma is 40.2cr, probiotics about 6.3cr and biocatalysis about 4.8cr.
• SciTech: We are launching different new products. We just got one of our products, we got just first one like effervescent pharma approval. We see a good growth this year going forward next year as well
• EBITDA margin of 37% in USA and in India it is about 29%.