Ceinsys Tech-Engineering, Geospatial & IT solutions Company

Ceinsys Tech Limited- technology-driven company that specializes in offering solutions in the Geospatial, Enterprise engineering, mobility services space

The revenue is primarily derived from its Enterprise Geospatial & Engineering Services segment

MCap-589
PE- 15
Sectorial Tailwinds because of Water & Sanitation Scheme
Valuations- Cheap Compare to peers

Full Thread- on my twitter


IMG_6368

Geospatial Segment Overview-
Geospatial Key Services-unlike ordinary spatial data,geospatial tech innovations help to determine the exact location of an inventory on planet.

1-Data Acquisition & Processing-High
2-Navigation & HD Mapping Services
3-Photogrammetry

Consultancy Services-Different kind of services provided by them

Energy Management Consultancy
BIM Consultancy
Project Management Consultancy
Water Management Consultancy

Mobility Segment Services- through recent acquisition of Allygrow (established presence in the US and European markets).

Services Available-
Style & Sketch
Concepts
Design & Validation
Feasibility
CAD & ECM
Plant & Manufacturing Engineering
Pre Series Development

The valuations comfort with growing profit + sectorial tailwinds is making it very well placed.

The solutions & services provided by them is interesting

Impressed by Ally Grow & MEG Nxt- serving two/three & commercial vehicles + Edutech + Gaming

Disc-No Buy Sell Advice



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Do you have any data on the industry growth rates?

India’s geospatial economy is expected to cross Rs 63,000 crore by 2025 at a growth rate of 12.8%

Geospatial-

https://pib.gov.in/Pressreleaseshare.aspx?PRID=1866812

https://www.geospatialworld.net/prime/key-trends-and-market-drivers-in-indian-geospatial-sector/

Water Management-

Engineering Services-

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Hi Vivek, thank you so much for sharing the detailed information about the company and market. Can you please share some more information about it’s current work order book.

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Some milestones of last year of allygrow are shown in this video:
https://www.linkedin.com/company/allygrow-technologies/posts/?feedView=all
The comapny allygrow is in engg design and embedded space similar to kpit and tat tech etc.

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Nov '23 - Results updates from Q2FY24

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Updates from Dec '23

Updates from Jan 11th

AGM Transcript from 2023

Updates from Q3F24 results

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5fd389b8-6854-44f8-9e3d-fa5702b31e94.pdf (621.7 KB)

New order…

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Recent Orders:

  1. b0269756-693a-4162-90cc-ea925d72d928.pdf (bseindia.com)

  2. db800438-8692-43ec-ab59-2f9f1955edc8.pdf (bseindia.com)

  3. 951e03f6-64fc-47ec-b7f3-a9ffb71d1580.pdf (bseindia.com)

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Wow, this company’s order’s are on a roll. Two more today.
SMC Infrastructures Private Limited
( Announcement under Regulation 30 (LODR)-Award_of_Order_Receipt_of_Order)

Central India Engineering Private Limited
( Announcement under Regulation 30 (LODR)-Award_of_Order_Receipt_of_Order)

Both the orders are for 6.7 Crores INR, for a time period of 12 months.

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image

Fund raising and Onboarding of new Investors. Putting Money into JV

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Some valuation data purely from company’s own data sources -

The DCF method accounted. Look at jump in PAT expected from FY25


source : https://www.ceinsys.com/wp-content/uploads/2024/04/Valuation-Report_Mr.-Shryansh-Jain.pdf
Based on these, Market Price per Share: INR 559.90
Current Total Shares: 1,63,39,397
Current Market Capitalization≈INR91,47,05,38,220.30
Now the company has also proposed to issue fresh shares and warrants to raise capital.
Share Warrants: 14,89,086
Equity Shares: 12,50,658

New Total Shares Post-Issuance

1,63,39,397+27,39,744=1,90,79,1411

After the issuance of the new share warrants and equity shares, the company’s total number of shares will increase from 1,63,39,397 to 1,90,79,141. This results in a dilution of approximately 14.35% for existing shareholders.

Current Market Capitalization: Approximately INR 91,47,05,38,220.30
Market Capitalization After Issuance: Approximately INR 1,06,83,25,63,959.90

The increase in market capitalization shows the additional capital raised through the issuance of new shares and share warrants.
But the market is valuing Ceinsys at 770cr. Is the valuation report off? Specially with the DCF method? Or is the company really undervalued as @phreakv6 pointed out in his thread?
Thoughts?

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PS : The latest “Ceinsys Employee Stock Incentive Scheme 2024” Granting 6,50,000 stock options to Mr. Prashant Kamat at Rs 10 is not included in these calculations. This accounts for around 3.83% dilution
Source : https://www.bseindia.com/xml-data/corpfiling/AttachLive/2fa6a1aa-5b78-4bf7-ae68-b3b84fb1e3f9.pdf

Interesting. To me it looks like an attempt to give a ball park fair value to the stock rather than deriving it. There is nothing wrong in the method but think of it like this. if you have to give a desired fair value what are the levers that you can use here to move the fair value up!

  1. For market price method i just need to select the last trading days when the stock has done well or atleast giving me the desired fair value.
  2. For comparable companies, if they are considering Genesys and Map My India as comparable then we need to also compare the projected growth. To the extent i understand both the companies are trading at higher PE due to projected future growth.
  3. DCF is sometimes used like goal seek. Check for PAT growth if its reasonable (try to back calculate the revenue for the given PAT and see if its achievable), also check the reasonableness of other items that leads to free cash flow calculations and check the discount rate that’s been used and if its reasonable. I can see that PAT has jumped 10x in FY25 and is something that you should be comfortable with if you want to believe the DCF…
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Anybody attended the virtual meeting of investors and management held tomorrow?