Thank for this update.
Posts tagged Value Pickr
My portfolio updates and investment journey (03-06-2024)
Thank u. Very much sir. It is more informative and clear my concept.
What is mean net block and how it will be effective for company sir?
My portfolio updates and investment journey (03-06-2024)
Thank u. Very much sir. It is more informative and clear my concept.
What is mean net block and how it will be effective for company sir?
Investing Basics – Feel free to ask the most basic questions (03-06-2024)
Thank u. Sir, but if depriciation are decreases then profit shown in balancesheet. I m wright or wrong.
Investing Basics – Feel free to ask the most basic questions (03-06-2024)
Thank u. Sir, but if depriciation are decreases then profit shown in balancesheet. I m wright or wrong.
Pennar Industries Limited (03-06-2024)
Q4 FY24
Financials
- The diversified engineering revenue for FY '24 is at Rs. 1,641 crores compared to Rs. 1,511 crores, up by 8%. And similarly, for our custom design building solutions, it is up by 5.24%.
Business
- PEB orderbook at 750 crores and Ascent at 44 million dollars.the current PEB orderbook is meant for the next 6-8 months only and more revenue will come.
- TAM of PEB in india: 7000 to 8000 crores
- Other income includes the earnings that we have from deposits, income from mutual funds, incentives, exchange fluctuation and a large amount is due to the collection of our old receivables.
- Salaries have increased but expected to stay relatively flat or increase slightly
- Finance cost is high because of fuelling growth and being stuck in the wrong businesses which is causing working capital to extend. The impact due to interest rate is 73 basis points and due to higher working capital close to Rs. 142 crores. As a % of net sales the * finance cost is higher but they expect it to come down by the end of the year but moderately increase in the next 2 quarters.
- In terms of working capital, you have to compare the working capital as a percentage of the net sales. Our stated goal is that we will be at around 3.5% as a percentage of net sales which we will be.
- US business has a different taxation and works on state so it can vary a bit but blended we can assume 23-24%
- Peak revenue without the addition of asset base can be 5000 crores.
- To answer your question, the gross margins for our pre-engineered building business in India, margin after variable is about 18%. The market leaders get 28%, 30%. So, we are hard at work trying to get that up. In the U.S., we get a substantially larger number, it’s closer to 30%. And it can move higher than that as well.
- For PEB in the US, it is man driven and you need people called DMs. So if you are increasing capacity and aiming for growth: you hire more of them.Our total manpower in the U.S. right now is over 200 plus. The factory staff is 169 plus DMs, everyone and others combined engineering staff, all combined goes well over 200. But for us to grow, as I said, we are continually adding new DMs
Outlook and expansions
- PEB, both in India and in the U.S. will grow on the back of our new Raebareli plant having been commissioned.
- In the U.S., CAPEX is underway, and our order backlogs have also grown quite well. So, we expect to see substantial double-digit growth in revenue and profitability in this financial year from our U.S. business as well.
- So, for our products in the U.S. and services, we are currently at a 2% to 3% market share. So, there’s a lot of potential for us to grow. Consequently, we are adding a lot of capacity in the U.S. in terms of manpower, sales presence, DMs and also production capacity. This will create over the next few quarters or the next few years, our U.S. business is we probably expect it to be our fastest-growing business. And the margins there are obviously also a lot higher than our India business. So, we intend to focus on U.S. revenue and profitability in addition to our India businesses.
- After the plant, boiler revenue will double this year and it’s good because the PBT margins are around 5-7%. Moreover, the industry standard for margins is even higher at around 10% so they will catch up to that soon in a few years.
- We have a 5-year plan to, shall we say, make most of our businesses, the current size of the entirety of our business. So like 5x their revenue
- we have commissioned and commissioned plants and plant expansions in Hyderabad, in Raebareli, in Trichy, also in France, but that is a small number, it’s a few crores and also in the U.S. So, all of these are growth verticals.
- US PEB capacity which is to be doubled will happen this year
- PAT margins will reach 5% this year or next year and that means PBT of 7% or so.
- Expecting quarter on quarter improvement for the next few years
- US business can do 35 million per quarter but it all comes down to adding DMs and capacity.
my thoughts: Extremely bullish guidance. Will be interesting to see how it does. I had modeled by thesis with low double digit revenue growth but it can surely do mid- high teen growth.
Valuations provide good comfort lets see!
Worried about working capital being overly stretched though
Sky Gold ltd. – Will it reach the sky? (02-06-2024)
I dont see anh red flag in this report except for the fact that OCF is negative.
- Net block increased because of the expansion, what is wrong in it.
- Paybles are low and Recievables are high - nature of the business. They buy gold bullion and supply to retailers in wholesale. So this is natural to the kind of business they are in.
- Probably ocf is negative due to above
- Other jewellers e.g. Goldiam also have very low employee cost.
Everyone is trying to become a forensic auditor these days. So take it with a pinch of salt.
Disc: invested so may be biased
Basilic Fly Studio Ltd (02-06-2024)
Thanks for sharing your thoughts. I completely agree to your perspective, the biggest threat I see is management integrity. Even before this results fiasco, what I have observed is the CEO does not have a full grip on the company, majorly on the financial side of things. He is great when it comes to VFX tech side and what is happening currently, however, I would expect my CEO to have full grip in entire company and have vision about how company would look like in next 3 years which seems to be missing.
However, saying that I still believe it was a genuine mistake (I could be biased when I say that), but they have totally lost investors confidence now.
See the bright Sun: Aditya Vision (02-06-2024)
Some excellent inputs.
Spoke to a AVL employee in eastern UP. Record tod sales . expect v good qtr june due to hot weather. sufficient inventory available with AVL so no AC shortage unlike other parts of India.