For a sale of about 20 crore, PAT of 2.19 lakh is difficult to digest. Do agree if it was newly blossoming unit. Big no for a unit of 18 years old and consolidating.

They have 4 verticals namely

1. Hospitals ( operated & maintained)-70% of revenue comes form this vertical wuth high margins. Currently at 200 bed capacity with plans to expand to 1000 beds by FY26, with 300/1000 beds in western india. The margins in this business are higher as they maintain 100-150 bed capacity hospitals with not that high end equipments. Their business model is to have high ROCE by deploying asset light model of Operated & maintained business with not more than 100-150 bed hospitals in Uganda, Nigeria, Tanzania.
2. Pharma distribution – This happens to be thier second high margin business with revenue from this strem upto 10%. Here they distribute medicines, medical consumables & equipments etc.
3. Medical tourism:- Idea here is to get patients to their hospitals in above mentioned countries and if they arent able to treat them than assist them with tourism end to end solution.

4)Medical Consultancy :- like helping healthcare facilities with type of infr etc they would need to organize and run a hospital. point 3 & 4 are negligible part of revenue.

The major focus is on asset light hospitals in these countires where helath care is in boom but not many player were able to sutain business over here. They also mentioned that they will be doing a capex of 25 Cr in FY25-26 to put up additional beds+ equipments . Also looking for M&A in Tanzania & Nigeria.
Its worth to make a note that they have ARPOB around 0.8 CR in FY23.
Note: Invested & will add more when the story is reflecting in numbers.

BigBloc Construction Concerns

I have seen recently many investors getting Gung-Ho on this company but I somewhat don’t feel comfortable with this company due to multiple reasons.

1- Reasons of Bad Q4 -due to Holi vacation- shortage of Labour in both construction site and plant.

In Q3 concal, they mentioned → there was a volume reduction in q3 due to extended monsoon.

I personally could not digest these reasons. These all reasons are quite insane to be given and how can a investor buy those reasons without thinking twice? All thanks to the price movement in stock which actually give them the confirmation bias make them bullish unnecessarily thinking it’s all good.

Holi was there in Q4 last year also. Then why such issue this year? (As mentioned above by another investor)

2- Percentage increase of Sales– 14.20% and 21.57% in March 2023 and March 2024 VS percentage Increase in Receivables– 18.35% and 67.90% in March 2023 and March 2024 respectively.
Parallelly Percentage increase in Inventory– 75.20% and 46.19% in March 2023 and March 2024 respectively which makes me suspicious about their sales numbers.

3- Their EBITDA margins are almost double of their competitors even from the largest player in the industry which again makes me more suspicious without any strong justification for the same that how are they able to operate on such a high margins catering to B2B clients that too in a Real Estate sector.

4- Also CFO/Ebitda is 56% and 35% in March 2023 and March 2024 respectively which is considerably low, which again is alarming.

5- If their ROCE is north of 30% then why their is still rise in Net Debt I know one will argue that they are in expansion phase even considering that the debt shouldn’t increase if the ROCE is north of 30% there are companies who have executed the expansion without increasing the Debt to this level considering their ROCE was also in line with this company.

I know I’m making this contra perception and many won’t agree to this but feel free to share your opinion and kindly correct me if I’m wrong somewhere in my analysis.

As quite a few people had asked, I have prepared a short video explaining how the calculation for 50EMA and 200EMA is done. Link given below. Please let me know if the video is clear. Thanks.

Fischer Chem.pdf (980.9 KB)