My thoughts on specific companies I have been invested in or following and some new ideas and thought-process behind them.
Sai Life Sciences - I have a thread on Sai which delves into the company in some depth, at least on the molecules and capabilities. The latest EC is a clear indication of doubling of capacities in several high value molecules - I have parsed it here. I think the company can double its CDMO revenue even from here in 1.5-2 years time (~65% of revenues) even as CRO (~35% rev) continues to grow near 20%. The margins guided by company are 28-30% but there are enough levers here which is there in one of the earlier posts here (all of which are playing out).
Few observations -
- I think the write-off in Q4 for 35 Cr, FY25 pertains to Tradipitant. Sai was very prudent in taking immediate write-off after FDA did not approve the molecule for gastroperesis in Sep 2024. But the innovator sued FDA post that and took delivery of the molecule (~$7m) in Q2 FY26 (and eventually got FDA approval for motion sickness on Dec 31, 2025) and now Sai made a write-back for 16 Cr in Q3, FY26 (might mean 20 Cr writeback in Q4, FY26). I was quite impressed with the prudence here.
- Sai appears to have not only got Zoetis back but seems to be setting up much larger capacities in high-value intermediate for Simparica as well. To me it looks like Simparica alone could be ~500 Cr contribution to topline from the two intermediates CF3-Ketone and BOC-Ketone at full capacity. Qulipta/Ubrelvy, Blujepa, Simparica, Lorundrostat, Quviviq all have potential to be ~500 Cr+ molecules (first 3 are very high probability). There will be numerous $5-10m molecules (maybe 20+) which will form the base reducing volatility
- Management mention 3 out of 5 in top 5 animal health companies as customers. There is a very interesting Boehringer Ingleheim deworming molecule which seems to be under trials (going by the export quantity which is substantial). This one can be a big revenue driver as well but it isn’t yet clear which one this is since BI Vetmedica is privately held company
- There is a good chance that 2-3 years down the line if CDMO contribution is ~75%, the EBITDA margins can be as high as ~35% and PAT margins ~20% (this is my guess based on what I am seeing, and not management guidance)
Hind Zinc/Silver/Gold - My views here remain same, however my allocation has reduced considerably here as I have found equity ideas to invest in (These were meant to be a cash position). It gave very good returns at a time when rest of the market was bleeding but I think its job is done for now.
Mtar - Thanks to @Rokrdude for briefing me on the idea and sharing some good videos on bloom energy. I did some deep work as well over the last few days and I have exhaustive amount of data and insights but I don’t know how much I can or should put in here. So will keep it short as a first cut. Mtar is a play on US data center capex. Mtar derives ~60% of its revenue supplying hotboxes, sheet metal enclosures, eletrolysers to Bloom energy. The names of the products sound incredibly dull and low complexity - but it is anything but. Hot box is a very complex, precision engineering marvel which contains fuel cell stacks, fuel reformer, heat exchangers, and gas manifolds. These have to withstand 800-900 deg C temperatures and still maintain 5-10 micron tolerance (very few companies in the world can pull this off - Mtar with its nuclear background is one of the few).
Bloom has been a very long term story in US markets with its forming in the 90s and decades of research and listing in 2018 and actually turning profitable only recently with $1.47b in CY24 and $2.02b in CY25 revenues (founded and led by an Indian - Mr. Sridhar). It is in the cusp of a J-curve of 3 decades of research and hardwork. Bloom has an installed capacity of 1 GW and is projecting $3.2b for CY26 (~50%+ growth) which will be roughly 1GW and is doubling capacity to 2 GW. Proportionately, Mtar as well has announced increases in hot box capacity from 8000 to 12000 units by Mar ‘26 (~40 Cr capex) and further to 20,0000 units by Dec 2026 (another ~60 Cr). If my math is right, 1 GW of SOFC will require 15000 hotboxes from Mtar and Mtar makes ~$5500/hotbox and with value-add that can go up to $7500/hot box (~1000 Cr/GW maybe max).
What is driving the tailwind is US data center BTM strategy (behind-the-meter). Essentially, it is impossible for US utilities to provide power to these data centers in any reasonable timelines (mostly 5-7 years+) so most of these are investing in gas turbines (TD Power provides generators to these) or solar power and of late, also SOFC (Solid oxide fuel cells which bloom makes). SOFC is currently a rounding error (< 1%) in overall capacity with Gas taking 40% and renewables 24%, nuclear 20% and coal 15%. Today only 1% of data centers is self-powered (off-grid). This number will be 27% by 2030. So SOFC can potentially double in growth for Bloom every 2 years (limited only by ability to put up capacities to support growth).
Technically SOFC is far superior in terms of energy density, emissions, ability to follow spikes in load without need for batteries etc. So though overall capex and LCOE here in this table is relatively high - Gas turbines need lot of spend in sound dampening, batteries and water requirement which pushes up costs further.
SOFC might finally be ready to overcome the skepticism and this might have just happened over the last quarter with Brookefield placing a $5b commitment with Bloom.
Mtar also has received 500 Cr orders in nuclear power for Kaiga 5&6 (Nuclear plant in KA, with units 1-4 already generating 880 MW at 220 MW each. Plants 5&6 will use PHWR tech taking overall capacity to 2280 MW (700 MW each). India has plans to put up 10+ such PHWR reactors in fleet mode, so this itself is 10k Cr+ opportunity for Mtar over next 10 yrs, so this 500 Cr is just the beginning here.
Mtar has good capabilities in aerospace & defence as well - having made the propulsion systems for Mangalyaan and Chandrayaan-2 and Agni missile assemblies. They also work with Rafael, Elbit as well as GKN Aerospace and Thales. Currently this division contributes just 72 Cr in revenue but can grow to 400 Crs in 3 years and this too is a fast growing vertical. Mtar also bid for AMCA project alongside Adani (leaving it as a footnote here, to show capability and ambition).
So in short, things are all turning around for Mtar across divisions and its on the cusp of exponential growth (order book at 2394 Cr with 1370 Cr orders coming just in Q3 - incl 500 Cr for kaiga 5&6). It has disappointed in the past but things are changing this time around and it can be verified from multiple publicly available independent sources.
Valuation isn’t cheap at maybe 20x EV/EBITDA FY28 but I don’t think this company is going to trade cheap being one of a kind, with seriously strong moats, growth and tailwind.
Aeroflex Inds - Thanks to @ananth for this idea. This again is similar kind of bet to Mtar, riding on data center tailwind, but this time for Indian DC capex (confirmed order book is for India but they can do the same for US as well). Aeroflex makes flexible hoses, bellows and liquid cooling skid assemblies. The last part is what got me interested. They have capacity of 2000 units scaling to 15,000 units in skid assemblies by Jun 2026. At peak util, liquid cooling alone can contribute 300-350 Cr in revenue (TTM 408 Cr) and they can make 25% margin on it (Capex < 100 Cr which means ROCE is incredible - couple that with tailwind and you get good value creation).
Hoses - ₹650–675 Cr. Liquid Cooling ₹300–350 Cr. Metal Bellows ~₹85 Cr. Hyd-Air Fittings ~₹45 Cr. Miniature Metal Bellows ₹25–30 Cr So peak revenue for overall company can be ~1100 Crs from current capex plans. Its a simple business. They do have a moat since these liquid cooling skids are designed with Vertiv and Aeroflex has an exclusive tie-up with Vertiv to be their only partner in India. The liquid cooling for data centers itself will grow 33% cagr over next 7 years as per industry reports - so this might be a good way to play the tailwind in a relatively simple, easy to understand business. The company hasn’t done much over last 3 years in terms of price performance, so we aren’t overpaying for all the new developments. Other interesting thing is the company otherwise also is very export-heavy (72% of topline with 60% to US alone) and has been hit by tariffs in Q3 - despite that they have 23% margins!
I have certainly missed a lot of details (and this post is already quite long), so will try to make a separate post in Aeroflex thread if I have time. They have had corp gov. issues 10+ yrs ago at the holdco (Sat industries) and it doesn’t make good reading - however, I am willing to look past it, as the business is now run by the son and he comes across well in interviews (subjective thing - suggest you look up recent interviews on youtube and make up your mind)
Kitex - This business and promoter have a chequered history as well but again, am willing to look past it because of few things that are interesting. Will keep it brief - Kitex has put up massive capex in Telangana (in Warangal and Hyderabad) - total capex will be ~3500 Cr in TS. Revenue potential is ~2000 Cr from Warangal and ~2500 Cr in Hyderabad. These are fully backward integrated plants that will generate 25000 jobs in TS. Obviously this is not small for a company of Kitex’s size but it is feasible (on paper) because of ridiculous generosity of Telangana govt. (Which is almost Chima level subsidies). In short
- Kitex is eligible for a 25% to 35% reimbursement on fixed capital
- 8% interest subvention upto 8% for a period of 8 years
- Power subsidy of Rs.2/unit
- SGST 100% refund for 7 years (for sales from Little Star brand in India)
- 5000 Rs. per employee subsidy for training
Couple these investments, subsidies with tariff tailwind and there is potential for good growth here. Kitex predominantly has exports in two HS codes (61112000 and 61113000).
In cotton stuff, Kitex has good market share alongside SP Apparel from India but India itself has just 15% market share and we are now at an advantage to China - so there is potential to grow our overall pie and Kitex and SP can both benefit here.
In synthetic clothes for kids, Kitex has 67% market share from India and India is not even in the top 5 - we could have a much stronger tailwind in this.
Overall, the thesis is simple - large capex, subsidies meets tariff adv tailwind. The risk is reversal in tariffs and Telangana govt’s poor fiscal situation - every single subsidy is where Kitex pays upfront and collects money later - so it can bomb spectacularly and this might be the final thing that buries the company. Interest costs have started hitting from Q3 so we need to see how the company handles it from here. But if it does work out, if at all India does well in garment exports to US in infant wear, it has to be because Kitex does well, so am hopeful. Two things to watch out for 1. There is a merger with promoter entity KCL which will make the related party transaction that have plagued the company go away. 2. Company plans to do a 3000 Cr QIP, presumably post merger. I am unsure how they will do it, considering company has barely any institutional holding at present. If these two go through, then odds of things working out improve a lot.
Apologies for the long post.
Disc: I have positions in Sai from Sept and have some recent buy transactions few weeks back. Mtar, Aeroflex, Kitex are newer and I have positions pretty much around current levels. This is not advice and I am not qualified to advice and am just a novice sharing my thoughts.