Phenomenal Investor Call Yesterday! Putting a few important pointers as I noted during the call
- Highest Revenues at 30238 Crores-13%
- Strong Pipeline.
- Manpower cost reduced to 23% from 2019 to 17% of revenue further reduction to 15% by next year. (My opinion is this means margins may be sustainable in this band)
- Overhead cost reduction from 8% to 3.5%.
- Reduction in inventory from 359 days in 2018 to 159 days now. Will not be reduced further.
Initiatives for growth
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Capability and Capacity building.
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New factory for LCA Tejas operational from October 24
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Capex of 3000 crores per year for 5 years- total 15000 crores
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IMRH and GE TOT deal require capex
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50,000 ton hydraulic press launched
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Self relaince and indigenious technologies needed to reduce need for foreign sources, Reduce licence production
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4000 crores R&D for IMRH. 2000 Crores for Naval LCH
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Tremendous oppurtunities for exports
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15% PAT for R&D to enhance capabilities.
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End to End Solution provider for Aeronautical solutions
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Order Book is 94,000 crores. 12000 crores addition even after sales of 30000 crores. Engines-ALH, Navy Dornier upgrade.
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Order book 47000 crores should materializes this year. 1.20 Lakh crores by next year even after sales.
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Important is various lines of ALH, LCA MK-II and LCH etc total AON of 1.6 Lakh crores is done. Orders will flow in 18-24 months. This is over and above the 47000 crores order for FY-25
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This will keep manufacturing lines occupied till 2032.
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FY25 -deliver of LCA MK-1a and LUH
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FY26 -HTT40, Civil Trainer
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FY-27: Marine Helicopter, LCA MK_II, Medium role aircrafts.
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Safran IMRH and GE TOT new engines in next few years.
Disclosure: Own in Family Accounts since last year.