One query
There is standard deviation used for the calculation.
However I feel that it does not indicate true volatility…
Say the values 3,7,5,8 gives STD as 2.22…
and values 3,5,7,8 also give same STD… However the second one is smooth in terms of time-series.
Any idea how to tackle this case? How can we ensure that the price has increased smoothly over the period. STD does not capture that essence.

I read that people calculate daily return, convert that to annualized one… Then take STD of those returns… That may resolve some aspect, but still it does not capture the time series aspect.

Loyal Equipments AGM’24 Notes

• Margins: Drop in GM in recent years due to increase in RM costs. Going forward expect ebitdm to grow to 22-23% with increasing scale
• Order Book: In good shape, have good order book in place (15-20% higher YoY) but last 1-2 months is down due to elections but will pick up.
• The recurring annual contract with Linde Engineering for 20Cr/annually will end in 2025 and it will get reviewed and mostly get renewed. The contract was to provide Modular Skids.
• Modular Package/Skid is the major product which the other competitors don’t provide so have an advantage in here and the market is shifting towards modular skid.
• Product Mix (FY’24):
  • Modular skid/package: 30-40%
  • Heat exchangers: 40%
  • Auxilary Skids: 10%
  • Pressure Vessels: 10%
• Expansion Plan: UAE office will be completed in 6 months. Already in USA doing sales & marketing and now will add a manufacturing plant in USA on the demand of a customer which might start by FY26-27.

Key Concerns:

1. Dependency on contracts/orderbook, top client (Linde) if doesn’t renew contract then revenues could be impacted too

2. Competitive Intensity: There is no differentiation in products and the other key players in market are at a bigger scale/are more established. And according to Loyal equipments their MOAT/differentiation keeping them in the market is their product mix – they claim no one else supplies Modulary Skids but once competition starts supplying then revenues could be hit pretty bad as contribution is very high ~50%

3. Working capital intensive business – Loyal’s revenue is dependent on large project by the user industry and typically the delivery period may vary from 30-150 days. If we look at its overall working capital days it remains between 100-200 days. These will also depend on dispatches during the year end.

An update on this ethanol story – Found this piece of information on public domain. The khaitan bio energy which was mentioned in the previous post is held privately by the Khaitan family. Attached screenshot :

Also there was no follow up update on the ethanol story in this year’s annual report. The piece almost vanished in thin air.
Earlier, in 2023 annual report there was a half page writeup on the ethanol story with a mention of creating a SPV and a concluding statement that read –

This was a bet on paper companies venturing into ethanol production, anticipating a boom similar to the sugar industry. However, it appears the management intends to keep the benefits to themselves for now.
Disc: Squared my position.

Infollion Research Services Limited: Financial Performance Overview (H1 FY2024 vs H1 FY2023)