They don’t do con-calls. They also do very few interviews - maybe once or twice in a year. Only way to track the company is through broker / analyst reports and by going to their AGM.
All right thanks! My first impulse is to look for concalls always. Anyways, will check out other resources!
@vivek_mashrani, @T11 @jirohit : thanks for developing and sharing the NESCO model in excel ! Super helpful…
The AGM notes put up on Value Pickr paints a good enough picture of the company.
Folks - I had some work there today and here’s my assessment - > The service line where Nesco entrance is didn’t have any issues while going or coming back. However, while returning, the entire stretch going from town towards borivali was jampacked (around 8 pm) but the service road was still ok.
In terms of the construction work, the progress since my last visit was quite visible and I reckon the civil work could finish in next 6 - 9 months (if continues at same pace)
Disc - Invested from lower levels … looking to add
There might be a caveat though:
Although now the smart move on the part of NESCO would be to assign some people to work constantly with the traffic police & metro workers on event days to sort out traffic.
Specifically, collect evidence that they’re helping with whatever they can. So that later if such an arbitrary blanket order is passed again, NESCO has it’s side of the case ready!
Nesco has clarified to SEs about the spurt in volume and also about no stricture on the holding of exhibitions .
Most large malls & commercial complexes in Mumbai assist the traffic flow by providing the “Traffic Wardens” - fairly standard practice, am assuming Nesco would be doing this for last 3-4 years already. Does not build any case against the blanket ban, in my opinion.
One other alternative could be, to have the vehicle parking area 15-20 minutes (spread it into 2-3 different places) away from the exhibition center and have shuttle buses (probably a tie up with Uber/Ola) every 15 minutes between parking and the exhibition center. If this could help in reducing even 150-200 vehicles per day coming into the center, it might turn out to be good. This method is pretty common at the US airports.
Not good news for NESCO which will lead to further delays for Metro Construction activities
Construction work on metro is on full swing. I think these works were approved earlier.
Analysis on Nesco
Not good for bulls of NESCo!!
With all due respect to his analysis skills, Dr. has hardly given a clean chit to businesses. He finds fault with every company from the past, in the hindsight. So, no big deal… should settle down in a few days.
Second your point.
Businesses operate in a badass world & so have to be badasses themselves to an extent. Petty issues will always be there for any business. Even Mr. Kotak tried to pull wool over RBI’s eyes, does that mean we shouldn’t invest in the bank which is doing excellent?
Which real estate player doesn’t have tax issues pending or competition? At least the entrepreneur in this case is forthcoming about not duping people with their savings and then keeping them hanging for years without project completion and also about not taking debt to expand to expand carelessly like the JP group which is now almost bankrupt and in a debt trap.
If you don’t take debt Dr. will call you slow, if you take debt, he’ll start talking about growing D/E and lower interest coverage etc. Well it’s a kind of a rock and a hard place situation!
Highlighting flawed capital allocation decision making by giving eg. of capital goods business, which is in itself such a small part of the business in Dr.'s own words, is again irrelevant when the company is talking about investing in BEC expansion or new IT building etc. That’s what the primary capital allocation is for the company.
Most importantly NESCO’s forthcoming with the shareholders as well, as one can gauge from the experience of people who attended the AGM…shared above.
If you’re looking for a picture perfect business at this mcap range especially, it just doesn’t exist!!
Even though I like reading Dr. Malik’s articles, he does get into nitty gritties which shouldn’t matter to the larger picture in hand. Plus the way he has shared the post on Twitter makes one think how bad NESCO’s position today is, which isn’t the impression one gets after reading the full post!
Imho, the biggest threat to NESCO business is from exactly the kind of events that unfolded somewhere around last week. External, not internal…
Disc.: views biased
Interesting counter observations above on Dr Malik’s analysis.
Probably the larger question could be why is the Company continuously putting money (may be small numbers) in Indabrator knowing well that it is not good capital allocation.
Regulatory flip-flop by BMC regarding holding events at BEC has highlighted a risk faced by the company which IMO hasn’t been discussed here and apparently wasn’t priced in. Sometimes an event like this (cancelling permissions at 11th hour) acts a wake up call to investors who begin to reassess risk-reward that exists at current price. Unfortunately, despite all the good things that are going on, risk-reward is still tilted in favor of risk. Just my humble opinion.
This was discussed and I also highlighted the potential concern but I agree we need to rethink the medium term risk.
Because, it is not just loss of revenue but also loss of credibility and if Im an event organizer, I just would avoid nesco for foreseeable future just to be safe.