The biggest investment they have made is in NSE 425crs. They have got 13,25,000 shares at the Rs. 3,207 a share. I think unlisted share price of nse is more than rs 5000 a share, which means the company has already made unrealized gain of 50%+ on this investment. If the management can deliver returns in excess of 15-20% on the cash they hold on balance sheet, I think investors still benefit because ultimately book value keeps on expanding. Yes, I agree to an extent doing investments at peak margins and peak valuation is quite risky, especially in current scenario where PSUs are overowned. So, a negative.
Posts tagged Value Pickr
Maithan Alloys Ltd (10-06-2024)
The biggest investment they have made is in NSE 425crs. They have got 13,25,000 shares at the Rs. 3,207 a share. I think unlisted share price of nse is more than rs 5000 a share, which means the company has already made unrealized gain of 50%+ on this investment. If the management can deliver returns in excess of 15-20% on the cash they hold on balance sheet, I think investors still benefit because ultimately book value keeps on expanding. Yes, I agree to an extent doing investments at peak margins and peak valuation is quite risky, especially in current scenario where PSUs are overowned. So, a negative.
MTAR Technologies – A wager on innovation meeting economies of scale (10-06-2024)
Electrolyzer as a product is not feasible. To replace grey hydrogen, green hydrogen needs to be sold at or around 2$/kg. No one is close to this price, except a company called Hysata. Secondly, with the advent of white hydrogen, electrolyzer might actually get disrupted in near future. However, remain very bullish on fuel cells. Disc: Biased and Invested
MTAR Technologies – A wager on innovation meeting economies of scale (10-06-2024)
The client bases are different. Incremental orders for Bloom is going to come from data centers. Now, i get your point regarding high interest rates, but data centers industry in US is booming and growing, with the advent of Nvidia and others. Don’t see why won’t Bloom and ultimately MTAR benefit from this
Arman Financial Services Ltd (10-06-2024)
Thanks for the reply. Yes that I know higher credit cost is in fact compensated by higher yield, but was unsure of the part of credit cycle we are in. Thanks for sharing your view.
Arman Financial Services Ltd (10-06-2024)
I think management has explained this point in the concall- MFIN is becoming a high credit cost industry, but at the same time, ROAs and ROEs compensate them for the risk they are taking.
My sense is, in the past we have seen cycles like 2011-2016 with no credit events or 2003-08. If Macro remains strong, good credit cycle for lenders can continue. There is no high stress or systemic risk at the moment anywhere. Wholesale lenders are still seeing write backs
Ranvir’s Portfolio (10-06-2024)
Pratap Snacks –
Some highlights from Q4 and FY 24 results –
FY 24 outcomes –
Revenues – 1618 vs 1653 cr
EBITDA – 141 vs 63 cr ( margins @ 9 vs 4 pc – massive margin expansion !!! )
PAT – 53 vs 20 cr
Q4 outcomes –
Revenues – 388 vs 387 cr
EBITDA – 35 vs 19 cr ( margins – 9 vs 5 pc – massive margin expansion )
PAT – 12 vs 22 cr ( had some tax reversals in Q4 FY 23 )
Rural demand continues to be tepid vs the Urban demand
Margin expansion mainly led by – restructuring of distribution channel and margins, cost optimisations and process improvements
Focussing on sales force automation to further reduce costs and to improve decision making using data analytics
Increased share of Namkeens in the company’s portfolio is also margin accretive
New Jammu and Rajkot plants have been operationalised recently. Jammu facility has a revenue potential of 160 cr at full capacity
Hopeful of a rural revival which should aid company’s growth and margins. Seeing some green shoots in Q1. If they sustain, company aims to do a double digit revenue growth for FY 25
In FY 24, company’s Namkeens portfolio contributed 16 pc of sales and grew by 15 pc YoY. All other categories de-grew marginally
( Extruded snacks, Potato chips, Sweet snacks )
Company has recently been listed in D-Mart, Reliance retail. This should help aid margins as more of high volume packs are sold through modern retail channels
Company’s core target consumers are middle class and below – both in rural and urban markets (unlike for players like ITC, Pepsi etc who mainly target middle class and above )
Confident of maintaining EBITDA margins > 8 pc for FY 25 ( there may be Quarterly variations ). The ultimate aim is to go to double digit margins on a sustainable basis
Aim to realise 50 – 100 cr sales from export ( basically Middle East ) markets inside next 2 yrs
Out of 20 lakh outlets at which company’s products are available, namkeen is available at only 5 lakh outlets. Clearly, there is a lot of scope for growth in this segment
Company’s overall capacity utilisation is @ 55 odd pc. Not likely to incur any major Capex expenses over next 2 yrs
Potential of yearly sales from Reliance Retail + D Mart for the company is around Rs 50 cr / yr
Marketing and sales promotion spends for FY 24 @ 1.5 pc of sales
Disc: hold a tracking position, may add if rural recovery sustains, biased, not SEBI registered
Poonawalla Fincorp formerly Magma Fincorp (10-06-2024)
True I have also heard that in concall also, but being in this industry so far I understood that this is a technique used by most of the people from corporates to save their image.Companies also use it to save thier reputation!
Arman Financial Services Ltd (10-06-2024)
Can someone please help me understand this. What is the limit upto which a lender is allowed to lend? Is there a threshold D/E that these companies cannot breach?
QIP will lead to dilution of earnings inflating the PE of the company. Should we ignore PE ratio in finance companies.
Any help will be highly appreciated.
Rashi peripherals “Nvidia’s preferred gem” (10-06-2024)
That’s the beauty of markets that everyone has their own views. You think me adding that prefix will increase share price hell no!!
Respectfully,
Understand the business Strengths & moats please,
Following are my points why I think it is a gem company!
Point 1:-
Think logically they are Nvidia’s partner from last 9 years so if Nvidia wants to increase their sales in India who will get benefit out of this!?
Point 2:-
If you think companies with 2-3 % Margin can’t make good returns please check Redington’s stock price who is their only close competitor their CAGR of last 5 years, Its 35% per year.
Point 3:-
4-5 years back they have started their new vertical of Data centers and cloud computing where in they do all the process from installation to after sales service by themself. And also have type with MICRON whose plant is going live In Q1 FY 26 so they will also get benefit from that.
Point 5:-
Mangement has guided they are also hopeful in getting more orders in Data center space as the new law is very beneficial towards make in India and store data in India. They already have order of 1500cr from NMDC data center.
Point 6:-
They have a market share of more than 45-50% in some products so there is a high switching cost for existing companies as there is no big player other than this and very unlikely, they will have any big competition as business of low margins aren’t lucrative for new entrants.
Point 7:-
Today this stock was also picked by Sandeep Jain who is famously know as “Jain saab ke Gems” please here his views on this stock, given on Zee Business Today!
Point 8:-
At last as Peter Lynch once said “During Gold rush, most would-be miners lost money, but people who sold them picks, shovels and blue jeans (Levis) made nice profit