file:///C:/Users/ADMIN/Downloads/295eef27-996a-442b-a9e2-083ce02b23a6.pdf
Arpna Capital Services Private Limited was issued 1500000 shares at just Rs 77 when the book value itself was Rs 150. After this issuance , stock had a phenomenon bull run to Rs 500.
Evidently Arpana Capital has exited its entire share holding of 5.86% during current quarter 
Disclosure : Exited in Oct 21 after booking decent profit
Thanks for sharing. It seems they might have off loaded completely yesterday?
They had even sold some quantity on 14th Dec 2022
Disclosure by Arpana Capital …Diposal in Nov
As Per Prabhudas Lilladher Management meet report.
If we see the margins Precision tubes has 24 % of the revenue but contributing about 42 % in EBITDA.
Recently received Letter of Intent (About Rs 2 Bn) from L&T on the first Bullet train project in India for supply and fabrication of special bridges required for high speed tracks.
Total forging capacity is ~32ktpa from 12ktpa earlier enabling volume growth - Added one fully automatic metal pressing unit with Rs 400 mn.
This addition in the capacity also helps in increasing the margin of the company.
Need to see how this will play out. Please add/correct me if I reported any wrong numbers / information.
The above mentioned information is from the ‘Management Meet Update’ by ‘Prabhudas Lilladher’ on July 31st 2023
Remarkable report by prabhudas liladher is available for free on their website:
glin-31-7-23-pl.pdf (909.1 KB)
Disclosure: Have a position, biased
Can you please share your thesis for investing in this?
Correct me if im wrong. As per their previous year concall, they are planning to reduce long term borrowings.
As per the screener their longterm borrowings are reduced.
Does this mean company is moving in right direction?
Also I saw only two concalls in last year , is there a reason why they are not conducting more concalls?
Just to add.
Exercise of Preferential allotment is also pending.
22,54,600 shares needs to be exercised within 18 months i.e 1st half of 2024.
If converted shareholding will move by 3%.
My notes on Goodluck India:
GI was started in 1986 by Mahesh Chandra Garg, operates as a diversified engineering conglomerate involved in the manufacturing and distribution of a wide range of engineering products.
Without beating around the bush lets get straight to the point
Company has 4 segments that drive most of the revenue in:
The company also excels in producing structures tailored for Roads and Highways, encompassing Bridges, Signage, Light Pole structures, W Beam Crash Barriers, Security Towers, Telecom Towers, Foot Over Bridges, and Under Bridges.
Recent updates:
A structures unit has been established in Kutch, Gujarat and the supply of materials to L&T is already in progress, and the management anticipates that it will take approximately 12-15 more months to fulfil this order. Company is a category-1 supplier to critical components required for various projects of L&T in the domestic infrastructure space.
Management commentary: “There is a huge scope of growth and expansion in this segment and we envision an order book of over Rs.1000 crore in the next 2 to 3 years”
This segment contributes 15% to the overall revenue and 16% to the entire EBITDA.
Management commentary: “The segment is a substantial contributor of export revenue to the Company. We are supplying to some of the most respected brands across the world in both in Roads and off-road auto segment (BMW, Audi, Mercedes etc). The Company has been gradually consolidating its export business. The excellent range of products and services have enabled us to extend our presence in hundred countries across the globe with a base of over 600 customers. The current domestic to export revenue stands at 58 to 42”.
This segment contributes 14% to the overall revenue and 22% to the entire EBITDA and this might increase going forward.
Management commentary: “If you talk of forging Bharat Forge, very big name, we are very distinct cousin to him are making 10,000 tonnes. We are making 2000 tonne. But definitely we aim to. So, basically, we were on the defense side, so it will take some time to really identify the products. But the machinery is there and government has also to identify which products they want to source from India and what are the critical products they are they have to still import from overseas.”
“forgings, we are having a visibility of almost 5 to 6 months orders”.
This segment contributes 47% to the overall revenue and 20% to the entire EBITDA and this might decrease going forward.
Management commentary: “One other sector is CR coils, pipes and tubes, which is our oldest sector here. We manufacture ERW pipes and tubes that find application precision tube, support structures and other infrastructure, agriculture, auto and many more”.
Disc- Invested
KTA from Goodluck India Plant Visit and Management meet:
~ Goodluck India has entered into a strategic partnership with an undisclosed european player for Tracker Tubes production.
~ There used to be export of 6,000 Tonnes of tubes in total around the world to USA annually, which have reduced the exports from other countries to US significantly since the US government gave subsidies to local providers.
~ There is a continuous demand for GI pipes which are higher margin product. Company plans on take the current GI capacity from 4,100 Tonnes to 8,000-9,000 Tonnes.
~ Goodluck India currently has 1,500 tonnes per month tracker tube capacity. Company is currently working on replacing lower value added tubes with higher margin tracker tubes.
~ Company exports in Precision tubes are mostly related to Automobile players. Goodluck is one of the monopoly supplier to Auto players such as Bajaj, Mahindra, etc. in India. 3 months of Auto & Steel tubes are maintained at the plant of around 500 Tonnes.
~ Company faces no competition from European and Chinese players in CDW pipes.
~ Goodluck India has tied up with one of the largest company from US and Canada for marketing and production of precision tubes to countries like US, Mexico and Canada.
~ Company has an Order Book cycle of 6 months in Engineering Structures division. Engineering structures are not pre-fabricated and most of applications are in Bridges, Telecom, Power, etc.
~ The company is in an advanced stages of launching new products for defense segment plus orderbook is building up from government projects in Engineering Structures segment.
~ The time period for execution of the Bullet train project is 18 months plus company has received a new order from Chennai metro.
~ Sales guidance (Overall): FY24 - INR 3,500 crores and FY25 - INR 4,200 crores.
~ Most of the company machineries used in production process are imported from Europe.
~ Goodluck is the 2nd largest player in Precision Tubes after Tube Investments which is 2-3x in capacity plus a dominant player in the domestic markets and Pennar Industries is also one it’s competitors in India.
~ The company has planned a Capex of INR 100+ crores in the Forgings division.
~ Machinery used for forgings costs around INR 4 crores each.
~ Capacity Utilization (Forgings): Company has 42,000 Tonnes of Capacity of which 30,000 tonnes is being produced at current.
~ The size of an order in Order Book ranges from INR 10 lakhs to 50 crores in forging segment.
~ In the forgings space, company is experiencing robust demand in Oil & Gas segment. Oil Refinery company needs to replace the refinery units below the sea water every year as those get eroded due to salt water and the company foreseeing a huge demand from Oil & Gas companies based out of Gulf nations. Plus, the approvals are pending from companies such as Shell, TOTAL, Exxon, etc. Company is also in talks with Saudi Aramco (one of the largest oil companies in the world) to onboard as one of it’s clients in the forging division.
~ Sales Guidance (Forgings): FY24 - 650 crores, FY25 - 800 crores and FY26 - 1000 crores (targets to double from INR 502 crores in FY23 in next 3 years).
~ After setting up of new capacities at the Dadri unit, forgings gross margins from new units will be in the range of 35-40%.
~ Company currently forays into major sectors such as Nuclear Power, Aerospace, Defense and Oil & Gas in forgings division. Few of the listed competitors of Goodluck India in Forgings division are Bharat Forge, Ramkrishna Forgings, MM Forgings, etc. and it is still a small player in this segment compared to rest of the players.
~ The company’s maximum forging unit is upto 25 Tonnes for a single order and has forged 22 Tonnes maximum for one of it’s clients. The heavier the forgings the higher the realizations are for the company.
Goodluck India website shows Tesla as one of their clients. Any idea what their product is for Tesla and the product value size?
Goodluck India Precision Tubes are TESLA, Mercedes, Porsche
approved products. A good probability it’s tubes.
What products are there in precision tubes ,what capabilities are required in this product range?What competitive advantage it enjoys compared to peers. What is the gestation period to acquire such clients like tesla, bmw, audi.
(post deleted by author)
It’s interesting to see how the management dealt with the downcycle and trying to achieve targets from 2016.
** Anticipating the future. Actual data could be different
Disclaimer: Not a BUY/SELL recommendation. Please do your own research. I often go wrong and change my views without sharing. No investments in Goodluck India to date.
