Listed Microcap- Frog Cellsat- Opportunity

Market Cap- 440 cr
PE- 25
Newly appointed CEO- Pankaj Gandhi, he is formerly Managing Director, of the India subsidiary of ACE Technologies.

Read more at: Frog Cellsat Ltd appoints Pankaj Gandhi as the new CEO -

Frog Cellsat Pvt Ltd. design, manufacture and market cost-effective Repeater solutions for In-Building 2G, 3G, and 4G voice and data services for Mobile Operators.

Frog Cellsat Ltd manufactures telecom equipment that goes into Telecom Towers such as 2G/3G/4G Multi-Band Digital RF Repeaters, Multi-band Frequency Shift Repeater, Multi-band Optical DAS systems, relative software, and accessories. It also offers In-Building Coverage Planning and Design services along with Radio Access Network (RAN) and Backhaul Network installation services.
The company’s customer list included Bharti Airtel, Voda-Idea, Jio, Nokia, Ericson, Adani, BSNL, etc.

Recently they got order from BSNL for 4g equipment

Order book- 65 + 17 cr (recent)=82 cr

Solid R&D, Working for Defense Products

Good Expansion Plans with healthy guidance of 50% growth with 16-18% Ebidta

Working on many technology partnerships and technology transfer discussions are at a mature stage with reputed companies from UK, USA , etc- mentioned by management- Information


Client Concentration
Slowdown in 5g launch in India
Healthy Competition in telecom

Please provide your thoughts on the same


In June earnings call, management confirmed the order book as on 31.03.2023 is Rs 65cr plus additional new orders of Rs 10 cr in Apr and May. Recently new order of Rs 17cr is awarded, hence their orderbook will be more than Rs 90 cr.

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I might have missed that piece of information, thanks for highlighting the same.

With BSNL 5g rollout which is expected to start from next year beginning , they will get orders worth very good amount from them.

They submitted components to Jio, lets c if they get apporval.

Lets wait for the results.

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this slide from Investor presentation is very exciting. Talks about the various things company is working on and the potential opportunity size.
even if some of these opportunities click company can go onto a different level.
company has also developed an interference mitigation system with an Israeli company- if that opportunity clicks it can be a game changer.
Disc- Invested


Huge tailwinds of 5g and capex associated. With Tejas aiming to be top 5 telecom OEM and growth in digital. High corporate disclosure and governance, healthy balancesheet and new CEO to capitalise opportunity, holding for long term. Another player Kore digital also holding for long term

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what is the reason behind bad results of Frog Cellsat Limited??

did they do a concall this qtr? couldn’t find it

On screener con call link points to AGM minutes document, not a proper con call. They didn’t seem to have done a concall this time.

ConCall Aug2023

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Reliance to launch Jio Airfiber this Ganesh Chaturthi. Airtel too launched ‘Xtreme Airfiber’. Any idea if Frog Cellsat will be manufacturing AirFiber unstruments for both these 5G service providers.

Management of Frog Cellsat in a recent interview indicated that they are into manufacturing of Airfiber instruments.

Subjective Opinion

From friends, what I have heard is, ‘the-big-company’ usually strong arms its suppliers in terms of payments and probably discounts. They have the heft to do so and even multi-national companies, whom the person used to work for, faced the tough-love approach. Hence WorkingCapital in such suppliers needs to be well understood by investors.


Notes from Frog Cellsat Limited from the Annual Report 2022-23

  • Frog has ventured into defense projects

  • Its new manufacturing facility in Noida marks an increase in capex, enabling full-fledged operations by Q1 FY2024

  • Certified by the Department of Science and Industrial Research (DSIR) Government of India.

  • New CEO appointed - Mr. Pankaj Gandhi as the CEO of Frog Cellsat Ltd., effective May 2023. ( Professional Management - a positive)


  • Phase 1 construction of the new manufacturing facility in Noida, covering 100,000 sq. ft., signals increased capex.

  • Full-fledged operations begin in Q1 FY2024.

  • Phase 2 construction (60,000 sq. ft.) is ongoing and expected to complete by Q3 FY2024.

  • Increased hiring expenses as they see growth in the next few years

  • No Revenue Growth but 100% debt free company

In FY2023, Frog clocked revenues at 1,33 Cr, which is relatively at the same level of 132.9 Cr million in FY22

  • FY24 Guidance -

Revenue is expected to grow in the range of 45% to 50% in FY2024,

EBITDA margins are expected to be in the space of 16% to 18% for FY2024 vs 16.48% in FY23

  • Employee benefits: ( 151 employees as of March 2023 / 197 as perLinkedIn 5th Oct 2023)

The Company extends assistance for education of children of the employees. Shiksha Sahyog Policy

Median employee tenure ‧ 6.2 years (LinkedIn)

Red Flags:

  • Promoters has issued shares to themselves for almost free before the IPO: 225 (Two Hundred and Twenty-Five) new equity share for every 1 (One)

  • Production Linked Incentives are recognized as income when on the basis of the judgment of the management

  • There are several litigations pending for the inventory filed by the Company

  • TDS default for previous years amounting to Rs 5.99 lacs

  • They are getting into defense/government projects so the payment cycle will increase

Things to monitor:

  • Revenue Growth guidance that management has given can be achieved , very aggressive

  • Track related party transactions as they do have a few

  • They are eligible for and get PLI incentives from the government in the next FY

  • Progress and deliverables from the new Noida plant from Q1 FY2024 onwards


Can you explain this a bit more ?
“Production Linked Incentives are recognized as income when on the basis of the judgment of the management”

Reads very bad

Basic issue with this company is that their per product revenue will likely be low (may be because of non-critical nature of products) and in many products there isn’t much margins to be made. So, company has to continuously develop products to keep growing revenues. This seems like a tall task as with NPD comes validation, delays, etc. It works best when revenue opportunities are large, not when tiny.

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My thought was management has a lot of say in terms of revenue from PLI - they can move things around to suit themselves or suit timelines. May not be huge issue but we are dependent on management here.

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Does anyone track this stock closely? I feel that it got oversold after the projection of growth was cut down to20%> But it still trades at 20 PE so looks attractive to me.

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My thoughts are the same. Bought one lot recently.

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