Caplin has main business in latin america
So i dont have heard any of its products.
For pharma, i have invested in beta drugs and many of my onco friends have personally used its products
1 Like
MOATS(BEW ENGINEERING)
-I try to findout smallcap company haveing niche and it is among top 3 companies in its industry
-I like to buy stock when it is out of favour(dull industry)
-I like to avoid hot industries(solar, EV at present)
-Following are few partial/strong moats of bew engineering.
1…MARKET LEADER
=40% market share out of Total Dryer Market in India…We are among leading designer & manufacturer of process equipment for Pharmaceutical & Chemical Industry
2…DIVERSIFIED PRODUCTS
=We have a very, very big product range if you compare us HLE and GMM for the process equipments.
=HLE and GMM hardly manufacturing one or two type of dryers
whereas we have a range of around eight to 10 filters and dryers.
=So, because of that, we are
able to generate more business process equipments as compared to HLE with only two equipments.
So, definitely that is what
makes us different from them.
=Hle and GMM have most of the revenue from glass lined equipments only and not from process equipments. So that’s why, they are not more into the service equipments
whereas we are not into glass lined so we have more focus on process equipments
=Few applications where HLE and Gmm are not present,
A… Plough Shear Mixer Dryer,
B…Spherical Dryer
GMM is there but GMM has to completely import those particular dryers from their mother company. So, the cost is huge for them, HLE has not yet started those kinds of equipmentsin India.
C… Chronical Mixer Dryer or ROTA
Dryer you can say, that is also not manufactured by GMM or HLE .
D… Cantilever Rotocone Vacuum Dryer, that is originally manufactured by us they don’t manufacture those
equipments. So, these are few equipments which we are getting orders for.
E…There are many other equipments like lot of blenders also we manufacturer which they don’t do.
F…And also recently what we started was a Contiguous Dryer that has till date no one has been able to manufacture that equipment in India
=As I told they are more concentrating in the glass lined business, they are heavily occupied with those
business mainly.
3…DESIGNING AND CUSTOMIZATION
=BEW is basically a design based company where the maximum kind of design has been taken care of for the client requirement. That is why we are getting the big, big orders where we are having good price, we can able to quote and people are ready to pay that much price to us.
=So we know what is the required design purpose and all. So, that is why my clients are coming more and more taking their own problems are coming to us to solve their problem by way of equipment. And we designed for that
=Design is the most critical part in our equipment. Design is our backbone, because of that only we are able to reach to so many customers and that customers have shown that faith in us and that’s why they have kept on coming back to us again and again and kept on pressing us orders.
4…QUALITY
=Our Company is authorized under The American Society of Mechanical Engineers (ASME) for “U” Stamp on Manufacture of pressure vessels and also authorized by The National Board of Boiler & Pressure Vessel Inspectors for “NB” Mark in Pressure
Vessels and other pressure retaining items.
=Certified as an authorized ASME U & R stamp manufacturer
=We are pleased to announce our approval from SABIC(Aramco) of Abu Dhabi in 2024 is a testament to our stringent quality standards and operational
prowess.
=Recognized and Trusted by Industry Giants
- SABIC - Got approval from SABIC and first order has been
completed successfully
-AJINOMOTO (Japan) – Received 5 Crs order for ANFD & PAN Dryer
-Aditya Birla (Thailand) – Received 5 Crs Order for ANFD
=Marquee clientele
A…Pharma@cipla, sun, jubillant, granules, Dr reddy, ipca,hetero
B…Chemical@Astec,Aarti ind, Srf, clariant
5…INNOVATION
=Last 5 yrs transformation from equipment manufact to solution provider
=As a special equipment company we are related to introduce many equipments which were industry first for India. Because we could achieve this, because of our in-house present capabilities also. And most of our equipments comes with a very, very
value-added benefits also.
=Our commitment to innovation and operational excellence has manifested in our recent endeavors of delivery and installation of bespoke equipment, including the Continuous Fluid Bed Dryer (CFBD), Twist Lock Teeth Bayonet Agitated Nutsche Filter Dryer (ANFD), and Rotary Vacuum Paddle Dryer (RVPD), to esteemed manufacturers both
domestically and internationally
=Ability to design & manufacture key products in house which are import substitutes & are industry pioneer
=New equipments
Company has developed 2 new equipments in FY23- they are the sole suppliers of this equipment and will earn higher margins in them.
6…REPEAT ORDERS
=Most of our clients give us repeat orders and have been with us for last many years
7…AFTER SALES SERVICE
Our team stationed at Dombivali, Thane, Hyderabad and
Noida to cater key customers across India
we serve our customers very efficiently and in a very timely manner
8…LOW COST MANUFACTURING
=Europe is very costly and never played any role in supplying to India.
9…ADVANCE PAYMENT
(No Credits or Least Credit period)
=Our focused Industry segment clientele has better revenues and profits from their supply to regulated markets and accordingly
they have been paying us advance payments at the time of the orders and have been paying almost full amount before equipment is delivered to them.
= This helps us in managing our working capital and finance cost. This also helps us in protecting us from
default or bad debt risks.
==============================
8 Likes
Astec has had almost no sales growth in 5 years. What is the rationale to hold a stock like Astec?
1 Like
1…Astec is in chemical industry
All chemical stocks are facing headwinds .So all chemical stocks have flat profit since last 3 yrs
However, due to huge dependency on triazoles, astec is suffering losses
2…Astec is migrating from triazoles to cdmo business.Cdmo business is growing @ 30-50% cagr
However it will take time.
3…New R and D centre
4…New herbicide plant.
5…Godrej group
Perticularly for cdmo business and R and D centre, i will wait
2 Likes
Bew eng( capex)
CAPEX
1…Debottlenecking
=Our commitment to innovation and
operational excellence has manifested in the successful completion of debottlenecking initiatives at our existing plant, enhancing our production capacity
2…New plant@2025@
=Earlier ,there was problem in land acquisition, but it’s done now. And construction work has started now over there
=The new facility is in the adjoining land that we have taken
=Expansion as we have taken up right now, that manufacturing unit will take
up, will be ready mostly at the second half of this year.(2025)
=Land acquired in 2023 and factory
shed construction - in progress
=Current and new facilities projected to support revenue up to ₹300 crores
=Target to reach 100% capacity utilisation in the next 3 years
=15 to 17cr capex will double production capacity. Out of this 11 cr for land
4 Likes
BEW ENG(Future growth triggers)
FUTURE GROWTH TRIGGERS
TARGET
A…300 cr revenue by 2027@30% cagr
B…Ebidta@20-25%
C…20% revenue growth is expected in FY24
D…Target to achieve INR 150 cr revenue in FY25
1…NEW PLANT@2025
2…NEW FUND
=Currently the issue was we were short on space, short on funds.
=So, we were not concentrating on other products also on that
much because of the space issue and the funds issue also.
=We have a very good product
range of our equipments what we are doing, if you compare us with other competitors also we
have very good product margin.
=But now all this is coming in the
space, coming in, we have started to concentrate on the other products also more-and-more and we have started to grab those orders for those other equipments also right now, and not only that, we have started approaching a lot of customers on a turnkey basis also,
3…NEW PRODUCTS
A…Continuous Dryer, or Continuous Filtering System
=We are into the development of some of our new products like the
Continuous Dryer, or Continuous Filtering System. So that will also open up few more other equipments
for us.
B…Continuous Fluid Bed Dryer
=Our recent achievement delivering and installing a state of art Continuous Fluid Bed Dryer machine to remove domestic client underscores of commitment to innovation and meeting client need.
C…Twist Lock Teeth Bayonet ANFD
= In addition to that we successfully deliver a Twist Lock Teeth Bayonet Agitated Nutsche Filter Dryer this we called as ANFD in short form.
D…RVPD
Rotary Vacuum Paddle Dryer, RVPD we call it RVPD machine with a capacity of 20 KL to repeat a domestic client base in India. We are proud to
announce that we are the largest manufacturer of this complex equipment in the country
E…Other than dryer/filter
=Our core products are filters and dryers, but, still there are many other equipments which are
there in the line, which are required with lot many customers. So, that process like also we are
trying to get at our end also so that, that helps us to increase our revenue also by much, much higher.
4…NEW GEOGRAPHY
= We are trying to expand our export market also.
A…SABIC
=After a thorough audit SABIC, subsidiary of Aramco, approved our facility and an order has
already been executed and dispatch the validations of the adherence of these SME code further
solidifies our reputation for maintaining the highest standard of the quality and compliances.
B…Aditya Birla Group in Thailand
=Additionally, we have secured the substantial order from the Aditya Birla Group in Thailand
marking a significant step forward in our global expansion effort.
= This massive equipment is one of the largest of its kind having a diameter of, 4.5 meter diameter and having a process capacity of 25 kilo liters weighing of 40 tonnes of each.
C… Other countries
=We are trying to penetrate right now the African region. So, we will be visiting one of the person
is visiting from there end in coming months at our plant.
=We have some requirements going up for the Singapore plant
as well right now.
=And another few discussions are going in some part of the Canada region also so, from there also we are expecting a business of at least around eight to 10 crores in next
half of the financial year.
=So going idea and also Bangladesh is also we are expecting to maybe
in the next half of financial year to start the expansion for the new plants as well.
=Strives towards audit by global pharma and chemical manufacturers (Recently audited and approved by
SABIC)
=Exports were 2 cr in FY22. They have jumped to 23 cr in FY23
=Received first export order from
Bangladesh in 2016 for its tailor-made equipments and then started
receiving orders from Indonesia,
Russia, Bangladesh, Israel, and USA
5…INDUSTRY TAILWINDS
=The penetration of the process equipment is very low currently.
=Government regulations have started for process equipment and surely we will see an uptick in this industry as well.
=Penetration of process equipment is very very less. Only top 100 companies are using and the bottom 900 are not using. As government regulations come, usage will increase.
=Agitated Nutsche Filter-Dryers (ANFDs) are essential in pharmaceutical manufacturing, aiding in efficient drying, crystallization,
filtration, and washing processes. Their agitated design ensures quick drying and uniform crystallization, while also acting as effective filters to separate solid from liquid components.
=ANFDs maintain an inert gas atmosphere, crucial for preserving sensitive pharmaceutical compounds’ quality.
=With their integrated dryer and filter units, ANFDs streamline operations, making them a top choice for pharmaceutical companies prioritizing efficiency and quality standards.
=The increasing demand for filtration & drying equipment in the U.S. pharmaceutical industry is driven by stringent quality requirements, the need for efficient manufacturing
processes, and rising healthcare spending.
6…EBIDTA IMPROVEMENT
A…Designing
Ebidta will be improved by increasing the portfolio of the product involving customized design and enhancing
the niche product basket
=We are having more design
involvement, we are getting very good price of that. That is one reason
=BEW is basically a design based company where the maximum kind of design has been taken care of for the client requirement. That is why we are getting the big, big orders
where we are having good price, we can able to quote and people are ready to pay that much price to us.
B…Fund raised
C…New plant
=That will decrease inventory cycle
7…CHEMICAL INDUSTRY /OUT OF FAVOUR
=We are seeing a lot of pressure in the chemical space be it agro chem or the API of the world. Are we seeing some kind of slowdown in your order inquiries ?
=Rohan Lade: No, I would say we are getting a decent bit of inquiries from most of all the customers, whether
it is agro or pharma, we have not seen that a big dip in that, it’s going pretty good.
= I am saying because every other day, I see at least minimum 10 requirements coming up. And just by mail on the mailbox. Not even my sales team they have to travel over although any customer that’s
on the mailbox, I’m getting those requirements.
6 Likes
BEW ENGINEERING
RISKS FACTORS
1…High inventory
=The company has maximum investments in inventory, as it is a capital intensive business.
=The average time taken to complete an equipment is 6-7 months.
=Company has 88 cr of inventory as on 31st March 23 as against 67 cr FY22.
=Main reasons for high inventory are exotic material and long production cycle.
=Exotic material
50% revenue has just come from exotic metal equipments and for exotic metal equipment is something like those exotic metal is not manufactured anywhere in India.
=So, we have to import those metal
and not just import we have to book that material at least prior five to six months. So, to book
that, so it creates a huge inventory at our end, So that’s why the inventory you will find it on the higher side.
=This rise in inventory is to execute order for FY24 and is a leading indicator of growth in revenues.
=Inventory cycles expected to reduce to less than 200 days this year.
Funding and streamlined purchases to help in managing inventory levels effectively.
A…New plant
= Going ahead yes, it will come down because of the cycles because earlier our production cycles were
up around eight to nine months. So the inventory was getting held up for too long.
=But now with the new facility coming in, the production cycles are going to come down to four to five months now.
B…New fund
=Earlier purchase also was not getting streamlined because there was fund shortage was there. So, that is going to get streamlined now .
=So now all the funding coming in, all the purchase will be on immediate cash term basis so that the price also will come down for the purpose of
purchasing. So all these things are definitely going to help us to bring down our inventories.
And just to give you a figure the inventories will come down to at least less than 200 days in this year
2…Slowdown in capex cycle of pharma and chemical sectors can pose a threat to the growth of the company
3…Rise in RM costs of raw materials- stainless steel, alloy steel, Hastelloy, titanium, rubber lining, etc are some of the raw materials used by the company.
= Company may or may not have the ability to pass on the increase in RM prices to the customer
=Basically what we need in stainless steel and exotic metals, we work in this two particular series
only and we almost, we are doing 50%, 50% for both of these metals right now.
4…Competition
A…HLE/GMM
=Key competitor is HLE Glasscoat and GMM Pfaudler
=HLE glasscoat is one of the key competitors of the company- HLE has 23% of its revenues from ANFD- which is around 140 cr. HLE is also present in glass lined reactors where BEW has no presence as of now
=HLE is 3 times bigger than us. Years to come the gap will narrow down.
B…European
=If you compare the Indian equipments with the European manufacturers the cost is huge for them. So practically, they are not able to compete with us
=Just to give an example, De Diatarsis is there in India from past many, many years, but still they are not able to grab those sorts of business what we
are able to do it.
=And same with the exports also, because the margins are so huge so if you go in other parts of the world, like the South African region or other Asian parts those regions are
more intended to buy the equipment either from India or from China
C…China
=No china dumping because customization of product is req in this industry
=China can dump bulk products, not possible for customized products
=Also ,india is favoured because of china plus strategy
5…Higher ebidta margin of 28% in 2024 is not sustainable because
=The cost of material has come down because earlier we were purchasing the raw material mostly on credit basis. And our delivery production cycle were also on the higher side. So the inventories were pretty much on the higher side. But right now, all the funding coming in, all we are purchasing, we are streamline our purchases and we are directly approaching the manufacturers for the purchases. So, the has brought down the cost ,so we have so high ebidta
B=However, going forward, we can have 20-22% ebidta
6…Promoter demise
Company is managed by
A…Prakash lade
Over 5 decades of experience
in engineering Design,
Production and services
B…Rohan lade
Experience of over 17 years in
Production and services related
to our business
However, prakash lade expired 3 months back.
As per my scruttlebutt, company is primarily managed by Mr Rohan lade since last 15 yrs.
So there will be little or no impact .
7…Concentrated portfolio
Company derives 70% revenue from ANFD
However as per management , company will diversify portfolio after expansion.
=========
5 Likes
Carysil -update
=Carysil has entered into an agreement with KARRAN INC., USA, to supply quartz kitchen
sinks for a new major US Home retail chain having~1800 stores across the United State.
= Our partnership with Karran began
in 2017 and has grown steadily over the years, resulting in this significant market presence.
= This collaboration highlights
Carysil’s commitment to providing high-quality products while expanding our global kitchen and home improvement market share.
=We will dedicate a production capacity of 150,000 Quartz sinks p.a. commencing from May 2025, for this new tie-up. An
initial investment of USD ~5,10,000 (Rs. ~4.5 Crore) is being allocated towards molds, machinery, and utilities to support
this production.
=This partnership marks a key milestone for Carysil, further strengthening our footprint in the U.S. market and positioning
us to leverage our expertise in manufacturing and designing innovative quartz sinks.”
Disc…invested
1 Like
Bew engineering
Few scruttlebutts from past employee
1…As per employee of HLE, Bew is on 2nd position for ANFD
1…ANFD/ANF@ main product@70%
2…ANFD is technical based product
(Not commodity product)
3…Reactors
=Reactor is commodity product and very competitive product
=Previously we were not making much
=But after expansion, we will make it
=Because customers demand for whole process equipments and they are ready whether we manufacture or we give them by outsourcing
=So that they dont have to go to 3-4 vendors for various products
4…Glass lined products are totally different industry.
=Glass lined equipments come under reactors.
=They dont come in dryers/filters
5…Uptil now, most companies use centrifuge instead of dryer/filter.
Centrifuges have high rpm and it leads to environment issue while anfd is close system ,so no environmrntal issue. So govts may compel for anfd and large companies always use anfd instead of centrifuge
6…BEW is 2nd largest manufact. of ANFD after HLE
=It is main competitior of HLE in
ANFD, RVPD
7…How many manufactures of ANFD in india
=There are 2 major players HLE and BEW Engineering.*
Then GMM, S2 Engineering, Promos, CPK Engineering, etc.
Overall total @20 players)
8…How much market share we have for Anfd in india
(@ 25 ~ 30 %. But this is an approximate.)
9…Promoters are honest
10…Before 4 yrs@8 engineers
At present@40 engineers
11…Volume
=ANFD@2L-30 KL
=RVPD/PSMD@upto 25 KL
=There are 3 categories of ANFD
One category: upto 5 or 6 KL, second category upto 10 KL and then above 10 KL
=A very few companies make ANFD above 15 KL
12…Bayonet anfd
It is more specialized product or routine anfd?
(Specialized)
13…Total 4000 installation
14…This stock is not for trading, its for long term investment
15…3 new products are added in last 3 yrs. So these will contribute to sales in next 2 yrs
16…Most corporate clients buy ANFD either from us or from HLE.Because when u r buying product of 30 lkhs, u will always consider quality
17…Service
=This equipment is sturdy.So service is req for installation and commission.
Then not much required
18…Ater cornoa, we have huge business opportunity.
19…New plant
-At present we are mainly focused on ANFD because we can make it faster in our limited production capacity
-But once new plant is estlablished, we will also focus on other products
20…ANFD life is 15-20 yrs
-Mostly not replaced but addition of product happens when chemical company increases capacity
21…We can expect 20% growth for next 10yrs?-Yes
22…Despite headwind and negative growth in chemical industry, why bew has good growth?
(Mainly excellent and consistent quality, very durable and long life, hardly any service issues)
23…As per one pharama company person,
“There are many manufacturer for same product portfolio but BEW is innovative and solution oriented company thatwhy it got orders from reputed MNCs. For e.g. they supplied >10cr order of Aditya Birla chemical for Thialand plant in June, 24.”
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