Ranvir's Portfolio

FDC Q2 highlights -

Sales - 486 vs 445 cr
EBITDA - 76 vs 67 cr, up 13 pc (margins @ 16 vs 15 pc) Margins in Q1 were 23 pc
PAT - 70 vs 52 cr ( other income @ 27 vs 13 cr )

Sales breakdown -

India formulation sales @ 391 vs 369 cr
Export formulation sales @ 76 vs 57 cr
API sales @ 19 vs 18 cr

Board approved buyback of 31 lakh shares @ Rs 500/share - that amounts to a buyback amount of Rs 150 cr - a significant amount

Last 5 yr growth data -

Sales growth @ 13 pc CAGR
India formulations sales growth @ 13 pc CAGR
Intl formulations sales growth @ 17 pc CAGR
API sales growth @ 11 pc CAGR

India business -

4800+ MRs
9 brands with sales > 50 cr
6 brands with no 1 rank in molecule category
Electral has annual sales > 400 cr
ZIFI (Cefixime-anti bacterial) has annual sales > 300 cr
Enerzal has annual sales approaching 200 cr

ZIFI-X - Ceftriaxone injection - (cephalosporin antibiotic injectable ) launched in Jun 23 - doing well

In H1, price growth is around 4.9 pc with new product growth at 0.9 pc. Legacy portfolio’s volume growth has been flat. Company finally seeing volume growth in Oct 23

Have filed 2 ANDAs in H1

Company focussing on expanding in East India where it was traditionally weak. Making descent inroads in Bihar, Orrisa, WB

Also investing behind Nutraceuticals and Derma portfolio

Certain one off expenditures in Q2 led to suppression of EBITDA margins vs Q1. However, Q1 is always the strongest Qtr with best margins for FDC Ltd

Export business momentum remains strong, expected to remain strong

Export business is already profitable, capable of funding its own growth ( minus the R&D expenses )

To focus on Opthal business wrt US mkts as the company is strong in this particular therapy

Company has 6-7 brands that generate sales > 50 cr ( except for the top 3 brands ). These are the brands where the company intends to extract higher growth and make them into 100 cr + brands

Hence the company intends to not go for aggressive new launches. Focus shall be to grow above mentioned brands into bigger ones

However, company intends to launch brand extension of the a/m brands

Henceforth, the company intends to conduct half yearly concalls

Mum-Mum infant formula is a very promising brand and company intends to grow this aggressively

Regular maint capex @ 50 cr/ yr

Disc: holding, biased, not SEBI registered


Gufic Bio - Q2 and H1 highlights -

Q2 financials -

Sales - 215 vs 175 cr
EBITDA - 40 vs 33 cr ( margins at 18.5 vs 19 pc )
PAT - 23 vs 20 cr

Domestic business - has 8 business units with a field force of > 1000 ppl. Products cover 15 therapeutic areas

CMO business - 50+ products, one of the largest lyophillization capacities in the world

APIs - specialises in anesthetics, Anti-Fungals, Anti-Biotics

International business - exports to over 20 countries

Current facilities -

Unit -1 Navsari - makes Ampoules, Ointments, Lotions, Syrups, Lyophilised powders, PFS (pre filled syringes)

Unit -2 Navsari - Lyophilised powders, PFS

Gufic Belgaum - Oral Solids - natural products

Upcoming facilities -

Unit - 3 Indore - Lyophilization, PFS

Completion by Sep 23, revenue contribution from Q3

Penem Block - Dedicated facility for Carbapenems (lyophilised, oral solids, dual chamber bags, dry powder)

Botulinum Toxin facility at Navsari - to make Botulinum toxin API and formulations in partnership with Prime Bio, USA ( used in Pain management , Derma and Neurology )

About 50 pc of company’s revenues come from Domestic business. Critical Care + Infertility care form about 70 pc of domestic business ( 45 + 25 pc each )

About 30 pc sales are from CMO business with 10 pc sales each from Intl and API business

Company has received DGCI approval for launch of Delbavancin ( used in acute skin and bacterial infections ) in India. Seeing good traction

Company sells to 50 pc of all IVF clinics in India

Company’s SPARSH division - has been set up to do the business like a wholesaler of 92 + molecules based Injectables to over 1000 hospitals in India. Currently, this division has a field force of about 40 ppl and is doing a business of about 3-4 cr/month. Expecting a good ramp up in the Sparsh division

Also launched SeraSeal under the SPARSH division. It’s an innovative homeostatic agent aimed at stopping bleeding on contact. Finding wide acceptance

Dydrogesterone ( infertility product ) - grew 20 pc QoQ in Q2. Sales expected to double in this FY

Company conducting trials for its own HMG ( human menopausal Gonadotropin ). It increases the success rate of IVF cycles. Trials are on vs established international player’s product

Q2 growth mainly led by Domestic mkt that’s doing much better

Rs 100 cr were raised by the company via preferential allotment. The same shall be used for Debt repayment

Deterioration in working capital cycle due - CMO business pick up and launch of SPARSH division where the payments are received from MNCs / Hospitals only after 90-120 days

Disc: holding, biased, not SEBI registered


EIH Q2 concall highlights -

Sales - 552 vs 417 cr, 32 pc

EBITDA - 165 vs 101 cr, up 66 pc

PAT - 94 vs 22 cr, up 256 pc

Net cash on balance sheet @ 509 cr

Out of the total revenues, revenues from flight catering and airport lounge business @ 100 vs 56 cr, EBITDA @ 37 vs (-) 3 cr

City wise Rev Par growth (YoY) for EIH properties in Q2 -

Agra - 60pc

Delhi NCR - 38 pc

International - 28 pc

Jaipur - 28 pc

Bhubneshwar - 26 pc

Chennai - 23 pc

Mumbai - 19 pc

Kolkata - 12 pc

Hyderabad - 12 pc

Bengaluru - 9 pc

Udaipur - 7 pc

Cochin - (-) 11 pc

Chandigarh / Shimla - (-) 35 pc - due floods

EIH Domestic hotels ( including managed ) vital stats - Q2 (YoY) -

ADRR - Rs 16500, up 23 pc

Occupancy - Flat

RevPAR - Rs 11865, up 20 pc

National presence -

12 Oberoi branded hotels

10 Trident branded hotels

Total rooms @ 3772

International presence -

07 Oberoi branded hotels

Total rooms - 497

Growth in ADRRs (YoY) in luxury / 5 Star part of the Industry is in 20s vs low teens for 2-3 star properties

Current number of 5 star and above rooms avlb in India @ 1.65 lakh. New supply coming on stream till FY 28 @ 0.55 lakh. Basically the demand - supply dynamics look good for next 5 yrs !!!

CWC should help the company in Q3 wrt rates, occupancy

Q3 - recovery in Shimla has been promising specially at The Cecil. The Windflower hall is taking slightly longer for full recovery as Cecil receives greater chunk of foreign tourists ( specially from UK due to its Historical value )

Middle East properties are seeing some pressure due to the ongoing Israel - Hamas conflict

EIH - vision for 2030 - minimum 50 more hotels with additional 4500 keys ( including managed Hotels ) - Confident of achieving the same. 03 hotels already in pipeline - Tirupati, Rajgarh, Vizag

Business in H2 should be good

According to Mr Oberoi- despite sharp increases in ARRs across 5 star properties, there is still a lot of head room for further growth

RIL has announced that 03 of its properties ( 02 in Mumbai and 01 in UK ) shall be managed by EIH in near future. The UK property is a 47 room hotel, purchased by RIL in 2021. The two groups shall also develop a new property in Gujarat the details of which are not yet known

RIL owns 19 pc in EIH. Another 14 pc is owned by ITC

Disc: holding, biased, tempted to add more, not SEBI registered


Dhanuka Agritech Q2 concall highlights -

Sales - 618 vs 543 cr

Gross Margins @ 40.3 vs 34.1 pc - Huge Jump !!!

EBITDA - 142 vs 98 cr, Margins @ 22.9 vs 18 pc !!!

PAT - 102 vs 73 cr

Guidance for FY 24 - double digit revenue growth over 1700 cr ( last Yr’s revenues ), EBITDA margins for full FY at around 17 pc

Company seeing excellent demand for its new product - DECIDE (insecticide) introduced LY. Fuelled by a few more insecticide introductions, growth in Q2 was robust

Launched 02 new innovative products in Q2 -

TIZOM - Herbicide for sugarcane crop - in collaboration with Nissan Chemicals Japan

SEMACIA - broad spectrum insecticide having excellent efficacy over a range of crops

Product wise sales break up for Q2 -

Insecticides - 44 pc

Fungicides - 18 pc

Herbicides - 25 pc

Others - 13 pc

Geography wise sales break up for Q2 -

North - 24 pc

South - 31 pc

East - 11 pc

West - 34 pc

Company’s unique strengths -

Asset light model with minimal investments in Fixed assets

40 warehouses, 7000 distributors, 80000 retailers covering over 1 cr + farmers

90+ products across agrochemicals and plant growth regulators

Tech Tie-ups with leading global companies from US, Japan, EU

Robust pipeline - focus on launching margin accretive 9(3) products. To launch 8 new products in next 2 yrs

Volume growth in H1, Q2 @ 10 and 20 pc respectively

Gross margin expansion in Q2 happened because of 2 factors - better product mix, phasing out of high cost inventory

Insecticide - DECIDE did very well in Q2. It’s a versatile insecticide. It’s a 9(3) registration product used across a variety of vegetable crops ( like chillies, brinjal, tomatoes, okra etc ) against the sucking pests. Hence its Mkt potential is also big

Dahej Technicals plant got commissioned in Q2. Nil revenues in Q2. Should contribute from Q3 onwards

DEFEND - a paddy crop herbicide should do well in H2

Plus there is upcoming Chilli season in South India - which is again a good opportunity

SEMACIA, TIZOM also have good sales potential in H2

In talks / discussions with a number of international partners for CDMO business. Things should materialise sometime in future

For DECIDE and TIZOM - Dhanuka is the exclusive local partner of the innovator

New products / Innovative products - introduced by the company in last 3 yrs are doing exceedingly well. Plus the margins in these products are also better

Capacity at the company’s three formulations plant is not a constraint. Company can almost double its revenues from the existing capacities

Disc: hold a tracking position, biased, not SEBI registered


Senco Gold - A worthy competitor to Titan -

Q2 concall highlights -

Sales - 1144 vs 911 cr
EBITDA - 39 vs 33 cr, Margins @ 3 vs 4 pc
PAT - 12 vs 9 cr

Demand for Gold Jewellery remains strong. Slowdown seen in the demand for big Diamonds. Demand for smaller Diamonds remains strong

Company has added 06 stores in Q1 and 03 stores in Q2. Out of these, 03 were franchise owned and 06 were company owned

In Oct 23 alone, company added 08 more stores ( 01 of them was franchise owned ) taking the total store count to 153 stores. Aim to add 07-08 stores for the remainder of FY 24

Aim to add a total of 04 more franchise stores this yr

Avg sales / store @ 33 cr/annum. For company owned stores, this figure is 38 cr/annum

Continue to maintain growth guidance of 18 to 20 pc for FY 24 with an upward bias. Last yr total sales were 4076 cr

Company maintains a comprehensive hedging policy. Unlikely to gain/loose much ( beyond 5-7 cr ) due sudden rise/fall in Gold prices

H2 margins are always better than H1 due better absorption of fixed costs due higher sales. Gross margin guidance for full FY @ 15-16 pc

Most of company’s franchise stores are located in tier 2-3 cities

Expect EBITDA margins to bounce back to historical levels in Q3

Consumer demand for Jewellery has not been affected by high gold prices ( YoY )

Company’s STUD ratio (ratio of Diamond : Gold sales) currently at 11.8 pc. Aim to take it to 15 pc over medium term ( next 3 odd yrs ). At company owned stores, STUD ratio is already at 13.5 pc. STUD ratio is much better in North India vs other parts. Better STUD ratio helps expand Gross Margins

In H1, company has grown by 28 pc. Out of this 15 pc is attributed to price growth and 13 pc to volumes

Gold sold with Diamond jewellery is generally 14 or 18 carat gold

Seeing good demand for Men’s Jewellery ( chains and bracelets )

Company’s main focus at present is in North and Eastern India. Likely to continue to tread cautiously in West and South India

Currently company has 10 stores each in Delhi NCR and UP

Avg transaction value in H1 has been around 66k vs 54k LY

Repeat customer sales at about 64 pc

Senco remains No 2 most Desired jewellery brand in India

Because of higher Stud ratios in North India, company aims to hit a stud ratio of 25 pc in North India. Chandigarh store already has a stud ratio of 24 pc

Next 3 yrs store opening guidance @ 25 stores / yr. Out of these, 17-18 stores / yr shall be company owned and the rest be franchise owned

Disc: holding, biased, looking to buy more, not SEBI registered


Indoco Remedies Q2 concall summary -

Sales - 482 vs 433 cr
EBITDA - 72 vs 88 cr (margin@ 16 vs 21 pc)
PAT - 35 vs 50 cr

Sales break up -

Domestic formulation @ 228 cr, up 9.5 pc. Ophthalmology and Stomatology did well in Q1. Due late rains, season for Anti- Infectives, Respiratory therapies has been pushed into Q3

International formulations @ 195 cr, up 12 pc. Regulated markets revenues @ 147 cr, rest from emerging markets. Emerging mkts revenues grew by 72 pc @ Rs 47 cr

APIs @ 36 cr, up 95 pc

Contract research and analytics @ 6 cr, up 74 pc

Goa formulations plant inspected by US FDA in 3rd week of Oct. Plant has received 04 observations

Indoco’s rank in IPM @ 32nd position with Mkt share of 0.65 pc

Management is guiding for H2 growth of min 15 pc in Domestic formulations business

There was some overstocking of a few of company’s products in Europe due to COVID. The inventory has now normalised. Expecting good growth from Europe in Q3, Q4. Guiding for 400 cr kind of annual sales from Europe in FY 24

Expect descent margin recovery ( 2-3 percentage points, min ) in H2. Had one time expenses wrt remedial actions at Goa, Site -2 in the second Qtr

Company’s product portfolio in India has a very heavy acute therapy bias

Focussing more on therapies like Opthalmology, Stomatology to reduce dependence on Respiratory and Anti-Infectives

Have realised some profit share on the sale of Brinzolamide ( used to treat high pressure inside the eyes ) in US. Same is likely to continue in Q2 as well. Company makes its API in-house at its API facility

Full FY R&D guidance at 5-5.5 pc of sales

Disc: hold a tracking position, biased, not SEBI registered

Hoping for a descent turn around in H2. That should be a nice tail wind for the stock price

1 Like

Sula Vineyards Q2 highlights -

Sales - 142 vs 128 cr, up 11.6 pc

EBITDA - 45 vs 38 cr, up 18 pc (margin @ 31.6 vs 29.8 pc )

PAT - 23.1 vs 19.5 cr ( up 18 pc )

Sales breakup -

Sale of Wines - 126 vs 113 cr

Wine Tourism - 12 vs 9 cr

Sale of Elite and Premium wine sales ( > Rs 700/bottle ) @ 73 vs 71 pc YoY. Elite and premium sales grew by 15 pc, while economy and popular sales grew by 4.5 pc YoY

The Source - brand doing really well

Company conducted 49k+ tastings at their vineyards and 35+ cities across India - up 45 pc YoY

Popular and Economy segment facing heavy discounting and intense competition

Institutional shareholding (FII + DII) @ 36 pc now

In Q1, Q2 - CSD sales more than doubled

India’s per capita wine consumption currently @ 25 ml vs 850 ml for China. In Europe, it is > 2000 ml

Grape harvest likely to be robust leading to supply security

Currently, the Wine Tourism is primarily happening from Nahsik facility. Aim to set up a similar resort near the Bangaluru facility as well. Availability of land is not an issue

In UP, Haryana - 90 pc of sales were from Noida, Gurugram. Company now actively trying to expand into smaller cities

Sales contribution from Maharashtra in first half @ 48 pc vs 54 pc last year

Current Gross Margins @ 78 pc - company very happy with the same

Company’s is gradually losing mkt share in the economy segment because of its premium focus

Disc: holding, biased, not SEBI registered, hoping for buoyant Q3 results


Devyani International ( master franchise of KFC, PizzaHut, Costa Coffee )- H1 / Q2 highlights -

Have opened 115 new stores in H1 taking the total store count to 1358. Company has stores in over 240 cities / towns in India

H1 sales @ 1666 cr, up 15 pc
Gross Margins @ 71 vs 70.5 pc YoY
EBITDA @ 332 vs 330 cr (margin @ 19.9 vs 22.7 pc )
Adjusted PAT - 93 vs 136 cr (adjusted for currency devaluation of Rs 61 cr in Nigeria business)

Brand wise sales breakdown -

KFC - 1025 cr, up 18 pc
Pizza Hut - 367 cr, up 6 pc
Costa - 67 cr, up 69 pc
Rest - others like Vango etc

New stores opened in H1 -

KFC - 50
Pizza Hut - 29
Costa Coffee - 34
Vaango - 01

Total overseas stores -

KFC - Nigeria - 38
KFC - Nepal - 22

Nigeria facing severe economic head winds. Company may have to support its Nigerian operations for some time to come (1-2 yrs)

Aim to reach 2000 stores by 2026 end. To open another 150 odd stores this year

Current stores breakdown -

KFC - 594
Pizza Hut - 539
Costa Coffee - 146
Rest - others like Vaango

Q2 is generally a seasonally weak Qtr. High food inflation also had a dampening effect on QSR industry in Q2

Seeing good demand on the days of big WC matches. As such, Q3 is a good Qtr

Company has formed a JV with RK associates and Hoteliers to tap the Railway modernisation plan of GoI by setting up new Outlets at the Station’s food courts

Company has announced a deal with PVR to Open Costa Coffee outlets at their premises. Contours of the deal are not fully known

Expecting an EBITDA margin uptick of 2-3 percentage points once the inflationary pressures are gone and consumer sentiment improves

Vaango currently contributes to 3 pc of sales

Yum brands ( the owner of KFC, Pizza Hut, Costa Coffee brands ) also spends on Marketing to help the company specially when the demand scenario is weak

Disc: hold a small tracking position, biased, may add more if the company performance improves in Q3/Q4, not SEBI registered


Ami Organics Q2/H1 results highlights -

Q2 results -

Sales - 172 vs 147 cr, up 17 pc

Gross Margins @ 41 vs 48 pc due - steep price erosions in finished products due oversupply from Chinese manufacturers, higher sale of lower margin products. Also, high cost inventory of RM was a head wind

Expecting much better performance in H2 due healthy order book that the company has

EBITDA - 25 vs 28 cr ( margins @ 14 vs 19 pc )
Lower EBITDA margins due - lower Gross margins, higher employee cost due annual increments, hiring for Ankleshwar Unit and ESOPs

Adjusted PAT - 15 vs 19 cr ( without factoring the impairment of JV - Ami Oncotheranostics )

Have signed another contract with Fermion taking the total number of products to be supplied to 3, enhancing revenue visibility for coming years. Commercial production to start from Q4 FY 24 from Ankleshwar facility (validation batches). Have a few more products in pipeline for which manufacturing contracts may materialise for Ami Organics with Fermion and other innovators

One UV Observer - speciality chemical product for paint Industry ( for metallic paints used in Auto Industry ) is scheduled for launch in Q3. The product uses Swiss technology. Validation batches have already been approved

Electrolyte Additives (for energy storage) update - in advanced stages of negotiation of contract with a couple of customers ( first Indian and global company outside China to develop the product ) - product already approved by 6 buyers

Ankleshwar plant to commence commercial production in Q4 ( basically the new 190 cr brownfield capex for advanced intermediates to go live )

Completed acquisition of majority stake in Baba Fine chemicals ( 55 pc stake ) in Q4

Q2 Sales breakup -

Advanced Pharma Intermediates - 134 vs 125 cr
Speciality Chemicals - 38 vs 22 cr (rapid growth due smaller base)

Current manufacturing facilities for advanced Pharma intermediates and speciality chemicals - 03 + 01 R&D facility
59 pc - exports
41 pc - domestic sales
Revenues from top 10 customers @ 58 pc

Cash and cash equivalents @ 104 cr as on 31 Sep

Chinese over supply is not a direct threat to the company. Its just that company’s competitors got cheaper RMs from China and hence the downward pressure on finished products

Company should be back to 48 pc gross margins in next 2 Qtrs

Capex in H1 @ 100 cr. Another 105 cr lined up for H2

Electrolyte manufacturing supply to begin in Q3. Commercial supplies to begin in Q4

Full capacity ramp up of molecules being supplied to Fermion expected to happen in FY 25 - Q3 onwards

Baba Finechem - long term revenue target of 200 cr. Expect exponential ramp up at Baba Finechem from next FY onwards

Aiming to ramp up speciality chemical sales to 2.5 times of current sales in about 2-3 years

Company’s domestic business is mostly spot business. Most of the export business is contract business

Ankleshwar plant has 3 blocks. One of them is Dedicated to Fermion Ltd ( 33 pc of capacity ). This block is fully booked. Other two will be used by the company for business expansion till FY 27

Increase in inventory due build up in anticipation of execution of Fermion contract

Baba Finechem’s H1 sales are 21 cr, PAT is 14 cr !!!

Disc: holding, biased, not SEBI registered


The three Fermion products they are talking about have a sale potential of Rs 500 cr each. Plus the electrolyte additive business has a sales potential of about 800 cr

Inside next 2 yrs, all this will be in the topline

The bottomline can potentially blast from here :star_struck: :shushing_face: :flushed: :astonished: :hushed:

Disc: holding, planning to add more


I follow your thread…Amazed to see so many companies you follow and track so diligently. Just a query- how do you find time to study and track so many companies on regular basis?

Hi… Mudit Ji

I retired recently from Indian Air Force after spending 20 Yrs with the Air Force

Basically - a full time investor now. Hence the time


Greetings from another air veteran. Happy to go thru your inputs and concall details. A treat, of course!!!


IIFL Finance ltd Q2 concall highlights -

Loan Book @ 73k vs 55.3k cr, up 32 pc

NII - 1001 vs 724 cr, up 38 pc

PPOP - 922 vs 654 cr, up 41 pc

Provisions - 252 vs 196 cr, up 30 pc

PAT - 475 vs 380 cr, up 25 pc

Gross NPAs @ 1.8 pc vs 2.4 pc

Net NPAs @ 1.0 vs 1.2 pc

Book Value / share @ 252 vs 215

RoE - 20.1 pc

RoA - 3.9 pc

Loan book break down -

Loans on company’s books - 44k vs 35.2k cr

Assigned assets - 18.4 k vs 15.4 k cr

Co-Lending - 10.5 k vs 4.7 k cr

Total - 73 k vs 55.3 k cr

Sector wise breakdown of loan book -

Home Loans - 24k vs 19.6k cr, up 22 pc

Gold Loans - 23.7k vs 17.8k cr, up 33 pc

LAP - 7.2k vs 5.9k cr, up 21 pc

Digital loans - 3.5k vs 1.99k cr, up 77 pc

MicroFin - 11.3k vs 6.7k cr, up 67 pc

5 yr CAGR of loans AUM growth @ 23 pc

5 yr PAT CAGR @ 28 pc

Avg loan rates -

Home Loans - 11 pc

Gold Loans - 18.5 pc

LAP - 18.6 pc

Digital laons - 22.4 pc ( primarily for MSME lending - unsecured loans )

MicroFin - 24.4 pc

AVG yeild- 17 pc

Avg cost of borrowing - 9 pc

Spread - 8 pc

Cost/Income @ 43 pc

Avg ticket size -

Home loans - 14 lakh

LAP - 7.7 lakh

Digital Loans - 0.7 lakh

Gold Loans - 0.75 lakh

Aim to reach AUM of 1 lakh cr by end of next FY

Company continues to remain cautious on unsecured lending / personal loans. Sounded skeptical of due diligence process followed by new gen Fintechs

Gold loan growth driven by company’s distribution strength

IIFL housing finance gets funding from National Housing Board at concessional rates - helps keep cost of funds under check

Company expects to maintain its NIMs at 7-7.5 pc or thereabouts

Management doesn’t see any credit demand slowdown if the economy remains robust - the way it is today

Avg life of Gold Loan portfolio is 90-120 days

Company believes, cost of borrowing has almost peaked in India. May move up-down by 10-15 bps, not beyond that

Company has slowed down its branch expansion spree. Should lead to lower Opex going fwd as more branches mature and their AUMs increase. Ex - IIFL’s gold loan branches have avg gold loan AUMs of 8 cr vs 22 cr for Mkt leader

Avg tenure of Digital loans varies from 6 months to 2 yrs. This is a high risk area. Hence the company is very aggressive in provisioning against Stage -3 assets wrt Digital loans. Despite that, returns are fairly attractive

LAP product in smaller towns etc has attractive rates. However, it also involves higher cost of origination like the cost of verifying the title, valuation of property etc

Q2 RoA @ 3.9 pc. Should be able to maintain the RoA range between 3.7-4.0

Credit cost range guidance given by the management @ 2 or thereabouts

Price war in Gold loans business witnessed in last FY is now abating. Hence the lending yields have gone back up

Co-Lending and Assigned books mainly consist of Gold, Housing loans and LAP

Current branch count at 4596 vs 3700 LY. As the new branches mature, operating leverage should kick in. On an avg, a branch breaks even in 18-24 months

Disc: Hold a tracking position, may add more, biased, not SEBI registered


Shivalik Bimetals Q2 concall highlights -

Sales - 128 vs 118 cr
EBITDA - 29 vs 27 cr ( margins @ 23 vs 23 pc )
PAT - 20 vs 19 cr

Manufacturing facilities -

Plant 1 @ Solan - for Electron Beam Welded ( a hi-tech process ) Shunt Resistors, peak revenue capacity - 700 cr

Plant 2 @ Solan - for thermostatic bimetal strips ( uses complex diffusion bonding techniques ), peak revenue capacity - 600 cr

Plant 3 @ Solan - for electrical contacts ( uses complex and specialised bonding processes ), peak revenue capacity - 300 cr

Total revenue potential of Rs 1600 cr vs current topline run rate of about 500 cr. Aim to hit these potential figures inside next 5 yrs

Capex lined up - 20 to 30 cr (only) - for improving productivity and cost optimisations from FY25-26

Product applications -

Shunt Resistors - regulate the flow of current in an electrical circuit. Used to measure, sense the flow of current and create a path of least resistance for the electrical current to pass. Used in - smart meters, EVs, Energy storage, power modules

Thermostatic Bimetals - critical components used in overload protection devices. Used in - switchgear, electrical appliances, medical devices, automobiles

Electrical Contacts - these are connecting points when a switch is turned on/off. Made of different types of precious metal alloys. Used in smart meters, switchgears, wires and accessories, electrical appliances

Sales break up -

Geography wise -
Export - 65 pc
Domestic - 35 pc

Product wise -

Shunts - 43 pc ( started just 5 yrs ago )
Bimetals ( including contacts )- 57 pc

Industry wise growth rate projections from 2023 to 30 -

Shunt resistors - 14 pc CAGR !!!
Bimetals - 7 pc CAGR
Electrical contacts - 7 pc CAGR

Formed a JV with International leader - Metalor technologies ( Swiss Company - Japanese parentage ) to make Electrical contacts ( announced on 30 Nov 23 ) - should lead to significant volumes uptick in the Silver contacts segment

FY 24’s slowdown should be a temporary phenomenon due current trend of de-stocking ( a lot of over stocking happened during the COVID times ). Long term growth guidance remains intact. Should see a descent pick up wef Q1 FY 25

Global slowdown ( due De-stocking ) being countered nicely by increased domestic demand, demand from Asia, Australia

India should be producing around 2 cr smart meters per year. Most of the component supply for these smart meters should get procured from Indian vendors under the make in India project

Breakdown of sales of Shunt Resistors -
40 pc from - smart meters ( out of this 15 pc is domestic demand )
40 pc - EVs
20 pc - energy storage systems

Share of fixed costs @ 11-13 pc. As revenues grow, operating leverage should kick in

Seeing some pickup in demand for Shunt resistors for smart meters. Hope to double sales of shunt resistors from the smart meters segment in FY 25

Should get back to 50:50 sales breakdown wrt Shunts : Bimetals sometime next yr. Shunts is a higher margin By and large, exports shall be the major driver of growth for the company over the medium to long term. This also is a key risk - IMO

If exports don’t pick up as expected, management still sees a growth of 12-15 pc in next FY. If exports pick up - as expected, growth in next FY can be as high as 40 pc

5G roll out should help the company as their products go into critical energy storage applications

Disc: holding, biased, not SEBI registered


Shankara Building products Q2 highlights -

Sales - 1142 vs 907 cr, up 26 pc
EBITDA - 36 vs 30 cr, up 23 pc ( margins @ 3.2 vs 3.3 pc )
PAT - 18 vs 16 cr, up 15 pc

Revenue break up -

Retail - 54 pc
Institutional - 46 pc

Same store growth at 23 pc

Introduced their own private label - Fotia Ceramica in Q2 - should help in margin expansion. Will be procuring tiles from Morbi

Received balance payment ( Rs 78 cr ) towards warrants conversion by APL Apollo - strengthening their balance sheet and will aid in debt reduction

Total retail stores - 90, spread across AP, MP, Maharashtra, Gujarat, Karnataka, Kerala, Orrisa, Goa

Growth in rental costs @ 4 pc YoY vs 26 pc growth in revenues

In process of opening two more experience centers in Maharashtra, MP

Both Steel based products and Non Steel products grew 30 pc YoY

H2 is always better vs H1 for the company as the construction activity picks up in the second half post the monsoons

Have set up a number of Stores in Stores in collaboration with Nippon paints

Intend to increase the contribution from Non-Steel business to 25 pc in next 4 yrs ( currently at 10 pc of the total business ). This should help improve their blended profit margins. Aim to reach 5 pc EBITDA margins in 4 yrs

Deterioration in cash flows should reverse in H2

APL Apollo’s shareholding ( post warrant conversion ) in the company stands at 5 pc

Company guiding for 25-30 CAGR growth for next 2-3 yrs. Well on track to achieve it in this FY

Company has closed a few unprofitable stores in the recent past. Did not mention the number of store closures

Won’t be growing the number of new stores in an aggressive manner ( likely to open 2-3 stores/yr ) as the company feels that same store growth can be buoyant for the foreseeable future. Company can double its sales within the existing infrastructure

Revenue contribution from APL Apollo products in Q2 @ 38 pc. Company shares a very cordial relationship with APL Apollo. Company has helped them a lot in expansing in South India. Don’t see them squeezing company’s margins

EBITDA margins at present for non steel business @ 5-5.5 pc. Should improve as the volumes improve

Disc: a recent buy, invested, biased, not SEBI registered


Shalby Ltd - Looks very very promising

Q2 concall highlights -

Sales - 243 cr, up 18 pc
EBITDA - 58 cr, up 37 pc !!!
PAT - 27 cr, up 50 pc !!!

Net Cash on books @ 70 cr
Q2, annualised ROCE @ 21 pc vs 13 pc LY

Company owned hospitals - 9 across western, central India with headroom to grow bed capacity without any major capex in most facilities. Shalby remains a leader in Joints replacement. Currently diversifying into Onco, Critical care, general medicine and transplants

Franchise hospitals - 06 facilities. Shalby ltd monitors quality of services via FOSO ( franchise owned, shalby operated ), FOSM ( franchise owned, shalby managed )models. All of them have ortho, joint replacement heavy models. Company gets into a franchise agreement only after stringent channel checks to maintain the reputation of the brand

Implants - manufacturing USFDA approved implants for sale across US, RoW. In long term, aim to make it a 800 cr business ( ie inside 5 Yrs ). Current annual run rate at aprox 60 cr / yr. The business is already EBITDA positive ( although marginally )

Surgery count in Q2 -

Anthroplasty - 3800, up 18 pc
Nephro and Urology - 740, up 42 pc
Onco - 480, up 22 pc
Cosmetic - 760, up 10 pc
Ortho - 740, (-) 13 pc
Others - 1080, up 17 pc

Payor mix -

Self pay - 35 pc
Insurance - 44 pc
Govt schemes - 21 pc

Last 5 yr sales CAGR @ 20 pc, EBITDA CAGR @ 22 pc

Q2 occupancies @ 54 pc vs 49 pc in Q2 LY (company doing 22 pc EBITDA at mid 50s occupancy - this is absolutely out of this world)

Implants business likely to pick up momentum in H2

Current sales contribution from Ortho + Anthroplasty @ 40 pc vs 100 pc 15 yrs back

Aim to reach a total of 40 FOSO + FOSM hospitals in next 3-4 years

As the capacity utilisation improves, EBITDA should keep improving

Avg rise in ARPOB on an annual basis @ 6-8 pc - likely to be similar going forward as well

As the franchise owned- Shalby managed hospitals scale up - this will lead to a further expansion in EBITDA margins ( which are already more than healthy )

Aim to reach 7-8 pc kind of EBITDA margins in the implants business by end of this FY

Increased inventory levels due anticipated pick up in Implants business specially in Q4

Expecting similar growth in Q3 on a YoY basis as was seen in Q2 in the Hospitals business

Looking to expand via Franchise / Owned hospitals model in cities like - Delhi NCR, Kolkata, Lucknow, Patna

Have set up a number of OPD centers in East Africa, Middle East, Bangladesh, Nepal - to rope in Medical Tourism patients. Medical tourism is EBITDA accretive

Disc: holding, biased, bullish, not SEBI registered


Gravita India - A very promising company

Q2 highlights -

Sales -836 vs 683 cr, up 22 pc

EBITDA -73 vs 59 cr (margins stable @ 9 pc), up 23 pc

PAT - 59 vs 45 cr, up 30 pc

Volume growth @ 14 pc

Last 5 yr CAGR growth rates -

Sales - 22 pc CAGR, from 1242 to 2800 cr (percentage of export sales from 25 to 37 pc)

PAT - 35 pc CAGR, from 15 to 201 cr ( PAT margins expanded from 1.25 to 7.18 pc )

Project updates -

Started lead recycling plant in Togo, expanded lead recycling capacity in Chittor, started rubber recycling in Tanzania, Set up a battery recycling plant in Oman ( via JV ), started Aluminium recycling in Senegal

Vision 2027 -

35 pc + PAT growth

25 pc + revenue CAGR

New recycling verticals - steel, Lithium, Paper

50 pc + value added products

Biggest entry barriers -

Deep rooted procurement network

Diversified customer networks

Customised and value added products

Currently - company has 4 recycling verticals across - lead, rubber, plastic and aluminium spread across 11 recycling plants

Current capacity utilisation @ 55 pc

Current scrap collection capacity @ 2.05 lakh MT

Current capacity @ 2.84 lakh MT/yr - across 4 verticals

Capex lined up for next 4 yrs @ 600 cr for brownfield + Greenfield capex

Slowdown is Aluminium segment in Q2 should reverse by Q4 or Q1 next yr. Lead business leading from the front in Q2. Flatfish business performance in plastic, rubber segments as well. Management expects all the segments to start firing by Q4, Q1 next yr

Company plans to set up Li-Ion recycling plant near Mundra. Have applied for necessary permissions. To start the pilot project first and then scale it up

As lead usage falls due reduced usage of Lead-Acid vs Li-Ion batteries, it may dent the company’s lead business to some extent. However, lead - acid batteries do have applications in various other areas. Also, because of conversion of ICE engine to Li-Ion battery, only the size requirement of lead acid battery is gonna shrink (by 30-40 pc) and won’t lead to their replacement. Lead metal has various other upcoming applications as well like in Nuclear power plants etc. This however remains a key monitorable - IMO
However, the company’s global Mkt share is only 2 pc. Therefore has a long runway to grow

Energy cost in smelting vs recycling of lead is aprox 4:1
Energy cost in smelting vs recycling of Aluminium is aprox 20:1

Also, Gravita India uses pyrolysis oil ( Bio-crude) vs fossil fuel for recycling processes to minimise the carbon footprint

Management insisted that 25 pc CAGR growth in topline should not be a problem in near future

Management also gave a volume growth guidance of 25 pc for medium term !!!

Min ROCE tgt for the company is also 25 pc !!!

H1 capex @ 65 cr. H2 capex tgt @ 100 cr

Next yr onwards, will be spending 100 cr/annum on new verticals - like Li-Ion, Paper and steel recycling

Only 10 pc of Plastic recycling in India is done by the organised sector - a huge tailwind

Current EBITDA contribution from Aluminium + Plastic segment is around 11-12 pc of the total EBITDA

Rubber - these days is also being used as fuel. Should help improve company’s margins as the company’s rubber capacities increase

Disc: holding, may add more, biased, not SEBI registered


Hello Ranvir…above quote was, around end of October, related to elin electronics.
do you still hold Elin ? do you still hold the same views ?
If i remember correctly Elin’s Q2 results were due in Novmeber.
Further at below link certain broker has updated EPS.

Based on updated EPS, it still gives promising target.

What would you opine…ELIN has consolidated enough by now ?


Elin’s Q2 results were disappointing

My reading of the situation is as follows -

During COVID months ( say Mar 20 - Mar 22, all major / minor waves included ) - a lot of products were over consumed across the country. Most of these belong to small home appliance categories. One can see a similar trend across the inner-wear, athleisure categories - where companies like Page Industries reported a sudden surge in demand in 2021, early 22 ( as people stayed at home far longer than usual ) and then the demand suddenly plummeted

Similar trends are being shown by companies selling small home appliances, like - CG Consumer products, TTK Prestige etc where the demand slowdown post FY 22 is unmistakable

Basically, the households across India overbought these kind of items, say before Mar 22. My ballpark estimate of situation correcting itself is 18-24 months ( rough estimate )

The slowdown in small appliance category is directly reflected in the sales of ELIN electronics for obvious reasons

Basically - it’s now a patience game

Dic : holding, ready to be patient for another 6 odd months with frequent situational reviews as I feel that once the situation corrects, companies like Elin electronics, Page Industries should do really well