Pix Transmission - low profile smallcap company

[Researcher]

@vyasln

The company is number one in India in this field.
The company is commanding brand equity in local and abroad.

What is the source of this information that the Company is number one in this field?

[Researcher]

Pix has numerous categories of belts and other products. Yet, it does not appear to be scaling as much as expected for a niche product category with such “a specialized manufacturer”.
Further, Pix products have applications across highly diverse industries. Yet, it does not appear to be scaling as much as expected for products with such diverse applications. It should also be noted that industries with belts application-- ranging from washing machines, treadmills, automobiles, and so on are likely growing at a higher growth rate than the Company. All in all, the Company does not appear to be tapping into the potentially mammoth market.
Any thoughts?

[nav_1996]

I think JK Fenner is market leader with 100 years of legacy. These are critical components and trust matters for OEMs. People also tend to go with OEM brand recommendations.

Moreover, JK Fenner not only makes belts but also drive systems which indicates they have technical superiority in this line of business. Just to give an idea about product range and technically complex sub-systems, JK is far ahead in the game. e.g. They have complete offering for EVs

[Amnesiac]

Its going to be very hard to track or be invested in this company without any management commentary. They dont provide a way to join their AGM remotely either.

Their AGM is scheduled on 26th July:

c789e4f2-ebf0-4554-a155-99d71362c5b7.pdf

Anyone attending the AGM, request you to please drop some notes here.

[Researcher]

@nikhil_chowdhary

Pix traditionally has been after market company.

In OEM, no brand creation. We tell we are suppliers toMM, Tata motors, IFB, whirlpool, Ingersol Rand. But brand creation not possible, ultimately they print their name.

90% of products in Replacement market. That is where value company wants to focus.

@ayushmit

:

1. 90% sales are in their own brand. They don’t want to do OEM business as that would hit margins
2. 70-80% sales are to aftermarket. Think about it - how tough it would be to sell belts in after market and to manage such huge no of SKUs

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As per above quotes, the Company appears to focus on after market / replacement market is not keen on being an OEM supplier as it believes that brand creation is not possible in the latter.

This is odd and needs to be understood. In fact, most brands suggest replacement with original parts. How can a Company be a leader in replacement parts when most brands suggest replacement of original make only? We are talking about high value items such as automobiles, washing machines, treadmills, etc. Customers are likely to prefer original parts.
Further, the relatively small revenue of the Company as compared with colossal potential market, makes one wonder about the rationale behind this strategy.
Anyone with insights from management or elsewhere, please help in understanding the strategy. Thanks.