The BJP’s success in the recent Uttar Pradesh assembly bypolls can be attributed to its successful efforts in regaining support from OBC and SC voters. The party employed targeted strategies, including fielding candidates popular among these communities, to secure victories in key constituencies.
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Investment journey of a late starter (24-11-2024)
Would you please share the investment reasoning for HiRect ? Also share the growth triggers.
Thanks
Apex Frozen Foods (24-11-2024)
Are we not looking at a classic mean reversion play?
Hitesh portfolio (24-11-2024)
Dear Hitesh Bhai,
Thank you for sharing your valuable wisdom with us. In your multibagger video, you mentioned that identifying consistent compounders available at a lower PE range could lead to multibagger opportunities.
Applying this framework, I came across Antony Waste Handling Cell, which seems to align with these criteria. The company has long-tenure projects that provide consistent earnings visibility. However, one potential red flag I noticed is its association with government projects, which might lead to higher receivables. That said, the company appears to be selective in taking up projects to manage this risk effectively.
At its current valuation (~25 PE on a TTM earnings basis), it seems like a compelling case. I would greatly value your thoughts on whether Antony Waste Handling Cell fits the profile of a consistent compounder.
Looking forward to hearing your perspective.
Investment journey of a late starter (24-11-2024)
Exited 3 stocks from the High risk High rewards section of the portfolio …
- Walchandnagar at 259 … had bought it at 215 …so no loss. Exited because the turnaround might take longer than I thought and even then the results are likely to be lumpy . In this kind of market ,it’s not safe to be riding stocks where future seems a mystery !
- THOMASSCOTT @203 … Lost 20% . Results were not bad but there is no communication or information from the owners regarding business direction. Also before Puja , saw the 999 shirts being sold at 499 at Spencer’s . Amazon ratings are not that good .
- Apollo Microsystems@91 …lost 15% . I had bought it as a good defence stock where promoter bought preferential issue at 108 and company was increasing capacity by 7x. I had assumed it would take 2 years . But sold because the promoter went pledging like mad in past months . That in itself was not a dealbreaker but then this week they notified that the preferential issue is also cancelled . They gave a reason that did not ring honest to me ,because of the pledging run . I thought that the management knew about the investor withdrawal much before they let the news out in public.Too risky to ride in this sort of market .
Added Vaibhav global as value bet with operating leverage in next few quarters .Added ACE as a solid company after a 6 month consolidation and with the main season ahead .Added Asian Energy services in the HRHR section as a relatively risky but hopeful bet mostly because the promoter buying and preference share issue along with the CHP tailwind.Their concall transcript indicated good technical management and they seemed honest and straightforward .
Sansera Engineering (24-11-2024)
Sansera Engineering Limited Q2 FY25 Earnings Conference Call Briefing Doc
Date: 12th November 2024
Attendees:
• Mr. B.R. Preetham – Executive Director and Group Chief Executive Officer
• Mr. Vikas Goel – Chief Financial Officer
• Mr. Praveen Chauhan – Head Corporate Strategy
• Mr. Rahul Kale – Chief Operating Officer
Overall Performance: Sansera reported strong Q2 FY25 financial and operational performance despite challenging market conditions. Revenue increased by 10% year-on-year to INR7,634 million, driven by growth in Auto ICE and tech-agnostic/xEV segments. EBITDA margin improved to 17.4%. The recent QIP of INR12,000 million has significantly strengthened the balance sheet.
Key Themes & Highlights:
-
Sectoral Performance:
• Auto ICE: Continued healthy growth, driven by the 2-wheeler business (21% year-on-year growth). PV business declined by 8% year-on-year due to export market softness.
• Tech-agnostic & xEV: Fastest growing segment (53% year-on-year growth) driven by ramp-up of orders from a large North American EV customer.
• Non-auto: 20% year-on-year decline due to weakness in off-road and agriculture businesses. Expect improvement in coming quarters with a stronger monsoon and new order execution for stationary engine and HCV customers.
• Aerospace: Under pressure due to customer headwinds, but demand remains robust. Expect gradual production recovery and growth trajectory resumption. -
Order Book & Growth Strategies:
• Order book stands at over INR20 billion, with 60% from international markets. Strong order intake of INR3.2 billion during the quarter, driven by both auto and non-auto sectors.
• Expanding capabilities with a new manufacturing facility in Harohalli, Karnataka, to accommodate new forging and machining lines.
• Expanding Pantnagar plant for low-cost manufacturing.
• 60% of future capex allocated towards new-age components in tech-agnostic, xEV, and non-auto segments.
• Expanding professional team with key hires in leadership roles.
• Strategic MOU with Dynamatic Technologies for producing high-friction parts for Airbus A220 aircraft door assemblies. -
Financial Highlights:
• Gross margin expansion of 1.3 percentage points to 41.3% due to improved product mix and efficiency projects.
• EBITDA margin of 17.4%.
• Interest cost higher sequentially due to higher debt and discontinuation of interest subvention on export credit. Expect reduction with QIP proceeds being used for debt repayment.
• Capex investments of INR2,937 million during the first half.
• Net cash positive post QIP. -
Future Outlook:
• Maintain positive outlook on 2-wheeler and tech-agnostic/xEV segments.
• Expect recovery in PV and non-auto segments in coming quarters.
• Continue focus on margin expansion through product diversification, cost control, efficiency improvements, and volume growth.
• Target 40%-50% CAGR growth in aerospace and defense over the next 2-3 years.
• Exploring strategic acquisitions and geographic expansion opportunities.
Key Quotes:
• On growth drivers: “Broadly speaking, beyond land and building, we intend to spend more than 60% of our future capex towards new-age components in tech-agnostic, xEV, and non-auto side.” (Mr. B.R. Preetham)
• On margin levers: “So these are two levers that we have. The third lever is the volume expansion on an overall basis and a higher capacity utilization, which will probably also materialize over a period of time.” (Mr. Vikas Goel)
• On aerospace outlook: “We continue to hold a positive outlook on aerospace and defense. And definitely, again, as I reiterate, that the company intends to grow by 40% to 50% CAGR in this sector for the next 2 to 3 years with a strong outlook on the order book.” (Mr. B.R. Preetham)
Key Questions & Answers:
• Significant order book increase in non-auto segment is driven by aerospace, semiconductor equipment, and agri sectors.
• QIP proceeds will be used for debt repayment, strategic acquisitions, geographic expansion (including a US assembly plant), capability building in forging and aluminium, and investment in deep technology startups.
• Expect margins to expand in the medium term as new business initiatives mature and cost optimization measures take effect.
• Peak revenue potential for the aerospace and defense segment is now INR325 crores to INR350 crores, including semicon.
• New orders in the semiconductor equipment segment are recurring in nature.
• Expect revenue share from the aerospace and defense segment to increase to 5.5%-6% in the next 2-3 years.
Overall, Sansera’s management expressed confidence in the company’s future growth prospects, driven by a strong order book, new business initiatives, and a strengthened balance sheet.