Blue Star ~ Leading player in RAC & Commercial Refrigeration (Market Leader)

Bluedart an idea given targets a growth of 25% in summer and around 30% revenue growth in March-June 2023. Targets 15% market share.

Source: Management Interview CNBC TV 18.

A lot of mutual funds increased their stakes in the Bluestar last month by more than 50 percent.

Therefore I took a look into Edelweiss research report on management meet. Everything looks positive
but CFO not increasing and debt not going down is confusing me :

  1. They have been gaining market share since few years.

  2. Revenue contribution from Unitary Products is increasing since many years and now stands at 43. I am guessing that unitary products has better cash conversion cycle and hence there cash flow should be increasing since last many years but it is not visible.

  3. They have become conscious before bidding for the government project(known for reducing CFO and increasing cash conversion cycle) but still there CFO is not increasing and their debt is still increasing.

Disclosure : Not invested

Superb numbers from bluestar
24% YOY quarterly revenue growth
45% YOY Ebitda growth
UCP segment growth - 35% YOY

I think AC as a category is an outlier among other consumer durables and home appliances segment in terms of growth and with now industry coming out of 2-3 years of low growth led by delayed summer/high competitve intensity, AC as a category should be an outlier among other segments

1 Like