Good results amidst railways stocks have had issues lately. HBL Power
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Kernex gets INR 2,041 Crs worth Kavach orders.
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With 27Cr fixed assets and 24Cr cash, how will they be able to generate revenue of 2041Cr in 1 year?
Will it have to raise funds?
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can anyone explain why kernex has announced an order win 5 days ago but hbl has yet not announced an order win?
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because HBL has not won an order yet!!!
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i thought order worth 8000 cr were to be announced between the 3 players - kernex, medha,hbl?
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Is there any portal to check recently awarded tenders by railways ?
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Dear Shekar, In listed space we are having KERNEX, HBL, CG Power, Railtel…
Out of the 10,000 units order (related to locomotives), GGTronics and kernex got 2,600 units orders.
Remaining vendors are HBLPower and Medha.
New entrants are RailTel & Concord control are also poised for growth.
Railtel also expecting some major chunk from the remaining units.
Concord Control is another listed company which has 26% stake in progota. Progota has conducted some trails on KAVACH. They are in final stages for getting approvals from RDSO.
Concord also planning to increase their stake in this company.
Holding: HBL & Concord Control
With thanks
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Any idea why HBL is getting only 70 Cr per system whereas Kernex got 80 Cr per system?
HBL has got orders for 2200 locos whereas Kernex has got order for 2500 locos. Order amount for HBL is 1522 crores (69 lacs per loco) whereas that shown by Kernex is 2041 crores (81 lacs per loco). I think the discrepancy is HBL has declared order size exclusive of taxes (clearly mentioned in the order details) whereas Kernex has not clarified about the same. Kernex order must be inclusive of applicable taxes. Subtracting 18% GST rates from Kernex order will clarify the matters.
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This is decent order. Whether HBL has capacity of 2200 lcomotive upgrade capacity in 12 months?
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As explained by Hitesh Bhai and clarified in this GOI site, cost per locomotive is Rs 80 lakhs/unit incl. taxes.
The cost for provision of Track Side including Station equipment of Kavach is approximately Rs. 50 Lakhs/Km and cost for provision of Kavach equipment on locomotives is approximately Rs. 80 Lakh/Loco.
As explained in the above link of the 5 steps of Kavach implementation,
Implementation of Kavach System involves following Key Activities:
1. Installation of Station Kavach at each and every station, block section.
2. Installation of RFID Tags throughout the track length
3. Installation of telecom Towers throughout the section.
4. Laying of Optical Fibre Cable along the track.
5. Provision of Loco Kavach on each and every Locomotive running on Indian Railways.
The step 5 is relatively less prone to execution risk. Given the experience from last implementation, HBL should be well positioned to address this. Please do cite any specifics where you see them failing either on capacity or capability side.
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HBL has received an order worth Rs.1,522.40 Crores from “CLW” for supply, installation, and commissioning of on-Board Train Collision Avoidance System (TCAS) equipment in locomotives.
The order is to be completed within 12 months.
My observations:
- HBL Power spent several years in developing TCAS technology.
- In recent concalls management guided that they are focusing more on margins and not on top line growth.
- TCAS/KAVACH is only one vertical and has huge potential.
- Other verticals like FUZEs and Retro-fitment of heavy trucks are looking promising for the upcoming years along with their conventional battery business.
With thanks
Disc: Holding
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India has inaugurated submarine battery test facility at the Naval Science and Technological Laboratory.
The collaboration with hbl power known for its robust battery solutions for various sectors including defense, underscores a commitment to quality and performance.
The ToT framework will enable hbl power to further develop and scale up production, potentially leading to exports and establishing India as a key player in defense technology.
1. It demonstrates the technical capabilities of HBL.
2. TCAS/KAVACH is just one vertical for HBL. Torpedo, fuzes, retrofitting of heavy vehicles are the other important futuristic verticals.
With thanks
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HBL Power Systems Ltd has undergone a [change in name] of the company to HBL Engineering Ltd with effect from 23 Dec 2024. The scrip symbol has been changed from HBLPOWER to HBLENGINE.
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Mr. Market does not seem be too enthused by a contract as large as 68% of TTM revenue. HBL might possibly bag a few of the remaining KAVACH tenders as well, possibly giving it a more than 100% revenue growth next FY. But clearly Mr. Market knows something else which I don’t. Is the market skeptical about HBL’s execution capabilities? I doubt that. It must be something else.
Shares of Kernex, the other listed company which bagged a 2500 loco KAVACH order, are also not doing that great. They did rally about 30%-40%, but one would expect a lot more than that because its a much bigger deal for the that company - they got a 2k Cr order when their TTM revenue is just 87 Cr.
What are we missing?
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Dear fabergas - As per my understanding, TCAS/KAVACH trails conducted by Medha, HBL and Kernex from more than ten years. After successful completion of all mandatory field trails they got final approvals from the regulator/RDSO.
The opportunity size of TCAS is very big when compared the eligible players hence euphoria created to these stocks as usual but government delayed giving orders due to various reasons and it gave chances to other new vendors to join this.
Already approved vendors:
- Medha
- HBL Power/engineering
- Kernel
Other vendors conducting trails: - CG Power (Taken over G.G.Tronics)
- Railtel (MOU with Quadrantek)
- SIEMENS
- Progota(Associated company of Concord Control)
Conclusion:
- As the new vendors are coming, the competition is increasing in this space.
- HBL Power having more than 10 business verticals and they want to be either 1 or 2 in those. Technical capabilities of HBL is far superior and in some verticals they are the only player. HBL Power concentrating more on their margins than top line (As per management’s recent concal)
- Mr.Market already priced in the “kavach” news hence it doesn’t react too much. If HBLs another vertical starts delivering…
With thanks
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