Everest Industries - Multiple Drivers in place


(KiranP) #66

Promoter is not selling shares. That’s a director. Regular employees and non-promoter directors typically sell shares when they’re vested under ESOP.

It’s only a red flag when promoter is selling in open market

Disc: Invested & added more recently


(suhagpatel) #67

Key highlights from the concall of Q3FY18.

Sales is happening more on panels and boards segment which is good for the industry as a whole as margins are better. There is a tremendous market which is waiting to be untapped by this segment. This segment is critical for company as its seen as an alternate to the plywood industry and has a huge potential.

Momentum to continue till monsoon in building product segment in India and value added products will drive sales going forward.

Export market is still subdued and will take some time for revival and orders to kick in.

Pre-engineered steel building segment will take sometime for revival. Investment yet to pick up and orders are yet to come from all sectors. The company has an order book of around 21000 MT in this segment which is sufficient for around 5 months.

http://www.capitalmarket.com/News/Analyst-Meet-AGM-News/Everest-Industries/992743

Regards,
Suhag


(Hrusikesh) #68

I listened to the call that day, a small correction: Mr Sanghi said that PEB segment was sluggish in last quarter and he blamed that on the volatility of steel prices. He said they are comfortable with an order book of 25000MT(equivalent to 5 months work) for PEB but currently it is at 21000MT, a bit lower than what is ideal.


(rupaniamit) #69

@suhagpatel - thank you very much for sharing your findings after discussions with company stakeholders and industry participants.

As we can clearly see that FCB (Fiber Cement Boards) business is picking up quite well for big public listed players. Current market for FCB stands at roughly 500-600cr growing at 15-20% annually. There are talks of “value migration” from Plywood to FCB. Obviously Plywood business is not going to die but it will be very interesting to see how much of migration happens from current 20,000cr Plywood market.

I feel new players will enter the FCB industry at some point. Existing players will definitely have the advantage given their manufacturing facilities in place along with good distribution network with dealers.

What is your take on the Entry Barriers for FCB industry? Why can’t existing cement players start offering FCB as generally FCB is 75% cement, 15% cellulose fiber, and 10% water and other chemicals? I feel it shouldn’t be too difficult for major cement players with big pockets to create a new product line offering. Since you have done a lot of ground level work - it would be great if you can share your view on FCB Entry Barriers.

I read in Centuryply’s FY2017 annual report page 25 that they are offering FCB product which they are currently importing. They plan to manufacture FCBs themselves once they have reached decent scale. So I see existing plywood players also offering FCB products as they foresee potential value migration.

Disc: I don’t own Everest. Holding Sahyadri.


(Ram Arvin) #70

You can check NCL Industries investor ppt…they already have these FCB in place under the brand name Bison panels and they have recently expanded the capacity also.


(suhagpatel) #71

@rupaniamit entry barriers for FCB industry are not tough to crack IMHO. There are already 4-5 players in the listed space and some more might be gaining traction there. However, the market is big enough to accommodate them. Shift from playwood to board and panels is real and the distributors whom i talked to earlier also confirmed that. Your note on centryply also vindicates that as century being a plywood company investing in FCB.

Advantage for existing players is already established distribution network and acceptance level of their products to the existing customers. Nothing much.

Vishaka who is also in the same industry came out with decent numbers yesterday so we will see the momentum going on for near future.

Regards,
Suhag


(rupaniamit) #72

Increase in product awareness and adoption of higher margin Fibre Cement Boards (FCBs) lead to recent run-up in Indian roofing businesses. I dug deeper to find whether FCB has potential to be a game-changer in construction building material industry. If you are interested to read what I put together, please click here. I am looking forward to any questions/comments.

Disc: not holding Everest. Holding Sahyadri