Sanghvi Movers


(hazariwalapu) #101

Year : Fy16 Fy15 Fy14 13 12 11 10 09 08 07
Fixed Asset Turnover 0.27- 0.18 0.14 0.20 0.29 0.27 0.30 0.40 0.38 0.36

Here is 10 years Fixed asset turnover ratio of this company. As we can see that they have peak of 0.4 times of FAT during high infra spending in economy i.e Fy 07-09, i think we also have to consider pricing power of the company as in Fy09 their capacity utilization was about 87-90% but there was demand from all sectors, while currently they have major demand from wind turbines only so i think they have little less pricing power than those years. That we can even see from their EBITDA margins which was more than 73% , currently which is around 63%.

By Fy2017, their Gross fixed assets will be Rs.2700crs and by Fy18, their fixed assets will be Rs.3000crs with debt of around Rs.600crs. Now if we assume asset turnover of 0.27 it can have turn over of Rs.729 crs and EBITDA of Rs.459 crs with EBITDA of 63% margins. so if infra spend boost up going forward, i think it will have lots of room to improve its margins, if you consider 0.35 of FAT and 70-72% of EBITDA margins.

Correct me if there is any wrong observation.

Thanks
Prashant

Invested.


(Mehnazfatima) #103

The actual figures for wind turbine installations for the Fy2017 is 5400 mw…this is 35% more than the estimate of 4000 mw given by HDFC. Can we expect a huge jump in Q4 figures of Sanghvi movers?


(Mehnazfatima) #104

The problem with relying on such statistical analysis is that we miss out on stories where the present is vastly different from the past. In Fy 2017, the wind power installation reached 5400 mw and for fy 2018 it is expected to go upto 6000mw…obviously such a positively developing story would be missed out.


(yudiagg) #105

SREI is also in similar business of leasing equipment. It has also shown excellent growth in the recent past.


(Mehnazfatima) #106

Srei is into equipment financing business…its an NBFC…its quite different from Sanghvi movers


(chets) #107

Excellent results by Sanghvi:
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/b359ebd4-c55b-4158-93e0-f9cc9184637f.pdf

  1. EPS doubled to 11.08 compared to last quarter(5.42).
  2. 200% dividend declared (4 rupees)

(hazariwalapu) #108

HI

Fy17 performance and Fy18 capex plans.
SanghviMoversLimited_FY17.pdf (207.7 KB)


(Kuppuraj) #109

Very high operating margin which is also expanding.


(Sameermct) #110

Very weak 1Q18 results. Reported loss of 3 crores. Any view?


(amit anam) #111

Unaudited Financial Results For The Quarter Ended On 30Th June 2017

http://www.bseindia.com/xml-data/corpfiling/AttachLive/af8f2ca4-b5c3-419e-a39d-d1a181adb3ab.pdf


(ankitkhemka7) #112

I hope that the management comes up with a con-call and a good explanation on the results. Weak execution by wind energy companies and possibly some GST related disruption in June may have a large part to play in this I feel… Hoping for some positive commentary by management…


(narender) #113

GST disruption for a asset leasing company? Is that an optimistic thought? This could be a harbinger of Suzlon’s results.


(hazariwalapu) #114

Anyone attended AGM today?

Prashant


(hemtan100) #115

sanghvi movers has and will remain a value trap. high exposure to wind sector and continuous capex requirements to grow the topline are key negatives.


(Saji John) #116

Sanghvi movers has cut it’s capex for FY18 citing poor wind mill execution. economictimes.indiatimes.com/markets/stocks/news/sanghvi-warning-may-hit-other-wind-firms/articleshow/60070524.cms

Discl: I have exited following this quarter results


(yudiagg) #117

I agree. I think investors should consider exiting Suzlon also. I had a very large holding. I have exited Suzlon. Sustainable growing bottom line from Wind related projects appears doubtful.


(nabilmoideen) #118

could you please explain your rational while investing in this script if you don’t mind please.


(Saji John) #119

@nabilmoideen my initial buy on Sanghvi was based on cheap valuations with play on infrastructure and indirect investment on renewable energy(wind energy, esp. as suzlon was on uptick), good management and their plan to increase capex which gave good visibility for at least 2 yrs. Now since Wind energy is not showing continued investment and the management is cancelling its crane orders, I sold Sanghvi movers. One lesson I learnt was that for infrastructure spending the pvt players can only do very little for turn around to happen. The major impetus and money has to come from Govt agencies upfront which is clearly lacking at least in wind energy(even though their plan is sky high)


(anshul jain) #120

The company may turn around and show good profit once govt starts renewable auctions. Company is currently available at 6x FY17 earnings which is very easy to clock once new order for wind starts coming in.


(khushi) #122

A cousin dealing in cranes business told me that company is fundamentally sound, but in short term say for another 6-9 months it will report poor results as it mainly deals in wind energy and no new projects coming up in that sector