Ranvir's Portfolio

[ranvir]

Insecticides India -

Q1 FY 25 results and Concall highlights -

Revenues - 691 vs 657 cr, up 5 pc
Gross margins @ 29.2 vs 27.6 ( descent improvement )
EBITDA - 85 vs 72 cr, up 17 pc ( margins @ 12.2 vs 11 pc )
PAT - 58 vs 49 cr, up 18 pc ( PAT margins @ 8.4 vs 7.5 pc )

Segmental sales -

B2C @ 75 vs 71 pc ( 52 pc B2C sales came from Maharatna + focus Maharatna products )
B2B @ 23 vs 27 pc
Exports @ 2 vs 3 pc

New product launch in Q1 FY 26 - Altair ( a herbicide for paddy crop - in-licensed from Japan Chemical Corporation, its an on patent product ) - this is their 7th in - licensed product from Nissan. Aim to clock sales of around 10-15 cr for FY 26 from this new Herbicide - Altair. Confident of ramping it upto 40 cr and more by FY 27. It’s a specialised ( but expensive ) product. Its available only to Insecticides India ( at the moment )

Product wise revenue break up -

Insecticides - 49 pc
Herbicides - 37 pc
Fungicides - 10 pc
Biologicals - 4 pc

Manufacturing footprint -

2 - Active ingredients plants ( @ Chopanki and Dahej )
6 - Formulation plants ( @ Chopanki, Dahej - 1, Dahej - 2, Udhampur, Samba, Sotanala )

1 - Biologics plant ( Shamli )

4 - R&D centers

Company is going to spend Rs 125 cr over next 2 yrs @ Sotanala to set up the AI + Formulations facility. This facility should have a peak revenue potential of aprox 500 cr

Some of company’s leading brands include -

Lethal - Anti-Termite ( a leading, 37 yr old brand ) Shinwa - Insecticide ( in-licensed from Nissan )
Torry - Herbicide
Hachiman - Herbicide ( in-licensed from Nissan ) Pulsor - Fungicide ( in-licensed from Nissan )
Green Label - Herbicide
Hercules - Insecticide
Mission - Insecticide
Terrox - Herbicide
Green Expert - Herbicide
Green Label - Herbicide
Pulsor - Fungicide

At present, company has 16 Focus Maharana products ( vs 12 in FY 24 ). These r high growth, high margin products ( mostly with Pan India presence ). Maharatna products are currently smaller with regional presence. Aim is to keep graduating more products from Maharatna to Focus Maharatna category. These Maharatna + Focus Maharatna products have gross margins > 35 pc vs 15 pc for plain vanilla generics ( taken from LY’s concall )

For a product to be categorised as Focus Maharatna, it has to do an annual sales of > 35 cr with > 35 pc GMs

Maharatna + Focus Maharatna products grew by 20 pc in Q1

Products launched LY are doing exceedingly well ( many have entered Maharatna range )

Launched - Sparkle, a broad spectrum Insecticide in Q2 ( in licensed from Cortewa Agriscience )

Investing aggressively behind marketing and farmer education via relentless farmer meets

Dahej technical plant has gone live in Q2. Company expects to clock 100 cr in sales from this plant in FY 26 + 40-50 pc CAGR for next 3-4 yrs from this plant

Wrt Sothanala formulations unit - hope to start production in next yr’s kharif season. Sothanala technical plant should go live by end of next FY

Company aspires to keep improving their EBITDA margins by 100 bps every year for next 2 - 3 yrs ( due to company’s sustained efforts towards premiumisation )

Kaeros ( their subsidiary ) should be able to clock 100 cr in sales in FY 26 and 150 cr by next FY

Seeing very good demand scenario for agrochemicals in July + Aug

Not seeing elevated inventory levels in the market in Q2

B2B sales were slow in Q1. Expecting them to pickup from Q2 onwards

Aiming to grow topline by 10 pc for FY 26 with EBITDA margins > 11 pc for FY 26 ( assumption - on a sale of 2200 cr and 12 pc EBITDA margins, full yr EBITDA should be around 264 cr vs 220 cr for LY )

Company’s sales breakup for Q1:Q2:Q3:Q4 is generally @ 30:30:20:20 ( with some minor variations )

Company generally gets a sales return of 3 pc of sales. Company always makes adequate provisions for the same

40 pc of company’s premium product sales come from South India

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation, posted for educational purposes

[ranvir]

Alkem Labratories -

Q1 FY 26 results and concall highlights -

Revenues - 3371 vs 3031 cr, up 11.2 pc
Gross margins @ 65.3 vs 64.5 pc
EBITDA - 739 vs 608 cr, up 21.4 pc ( margins @ 21.9 vs 20.1 pc - significant margin expansion )
Exceptional gain - 129 cr ( due sale of company’s Indore facility )
PAT - 664 vs 545 cr, up 21.8 pc

Q1 R&D spends @ 118 cr ( 3.5 pc of sales )
Cash on books @ 4870 cr

Company’s segmental performance -

Domestic business -

Revenues - 2265 vs 2022 cr, up 12 pc. Domestic sales contributed to 68 pc of company’s sales. Volume growth @ 2.9 pc vs Mkt’s volume growth @ 1.5 pc

Domestic growth was led by - anti-infective which grew @ 6.5 pc, GI @ 10.5 pc, Vit+Minerals @ 18.1 pc, Pain management @ 9.2 pc, Neuro @ 11.6 pc

Company’s rank ( in IPM ) in their core therapies -

Anti Infectives - 1
GI - 3
VMN - 2
Pain / Analgesics - 3
Neuro - 7

US Business -

Revenues - 698 vs 641 cr, up 8.8 pc. US business contributed to 21 pc of company’s consolidated sales. In Q1, company filed its first Biologics License application in US. In addition, received 5 ANDA approvals, launched 3 ANDA products

RoW business -

Revenues - 355 vs 326 cr, up 9 pc. RoW sales contribute to 10 pc of company’s consolidated sales. Sales growth in RoW mkts was driven by Aus + EU mkts

Total field force @ 12,500

Company is a leading player in Trade generics segment

18 of company’s brands in India clock revenues > 100 cr

Company’s RoW business margins are much better than their US margins. Company is now focussing on growing the RoW pie with renewed thrust

IPM breakdown of Acute : Chronic is about 62 : 38. But for Alkem, its about 81 : 19. 30 pc of company’s domestic business is under NLEM

Company has been improving their margins in the trade generics segment. Their margins in this segment are now very close to their corporate avg EBITDA margins. Growth in trade generics business is generally a function of growth in the acute therapies

If the Q2 performance is also good ( like Q1 ), company may up their FY 26 EBITDA margin guidance given earlier of 19 - 20 pc

Company expects MedTech business to start breaking even starting FY 28

R&D spends are expected to be much higher in H2

Actively looking at inorganic acquisitions in the Chronic space ( as the current business is heavily lopsided towards Acute therapies )

Capex planned for FY 26 @ 750 cr

Adroit Biomed ( acquired in LY ) clocked Q1 revenues of 15 cr

Aim to keep improving the consolidated business’s EBITDA margins by aprox 100 bps / yr till they hit 25 pc kind of EBITDA margins

Looking to commercialise their first Biosimilar in US towards the end of FY 27

Enzene clocked revenues of aprox 90 cr in Q1

Tax rate for full FY should be around 13 pc

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation, posted only for educational purposes

[ranvir]

Fed Bank Financial Services -

Q1 FY 26 results and concall highlights -

Company’s product suite includes -

Mortgages - Small and Medium ticket LAP, Home loans

Gold Loans

Business Loans ( now discontinued )

Breakup of current loan book - total AUM @ 15700 cr. Breakup is as follows -

Gold loans - 6,332 cr - 40 pc of loan book. LTV @ 72 pc. Avg ticket size @ 1.9 lakh. Gold loan AUM per branch @ 13 cr - second highest in the Industry after Muthoot finance

Mortgages - 8,539 cr - 55 pc of loan book. LTV ( for LAP ) @ 52 pc. Eligibility is accessed based on income analysis of the borrower. Avg ticket size @ 29 lakh

Medium ticket LAP book @ 4813 cr. Avg ticket size @ 61 lakh. Avg yeild @ 12.3 pc. Most customers include retail traders who use LAP to expand their business

Small ticket LAP + HL book @ 3727 cr. Avg ticket size @ 13 lakh. Avg yeild @ 16.1 pc. Most customers include food and tea stall owners who use the LAP to expand their business

Business loans - 618 cr - 5 pc of loan book

Total branches @ 668

Statewide breakup of branches -

TN - 94
Karnataka - 91
Goa - 5
Maharashtra - 124
Gujarat - 94
MP - 21
Rajasthan - 30
UP -25
Haryana - 25
Punjab - 10
Uttarakhand - 4

Q1 disbursements -

Small ticket LAP + HL - 200 cr
Medium ticket LAP - 449 cr
Gold loans - 5284 cr ( a sharp increase in this segment - has been a trend for last 5-6 Qtrs )

Consolidated yields in Q1 @ 16.2 vs 17.4 pc
Consolidated cost of borrowing in Q1 @ 8.5 vs 9.3 pc
Consolidated spreads @ 7.7 vs 8.1 pc

82 pc of company’s AUM is from customers with CIBIL score > 700. 12 pc from CIBIL score < 650. Only 7 pc customers have a CIBIL score < 7 pc

Asset Quality -

GNPAs @ 2 pc ( for mortgage business @ 3.4 pc )
NNPA @ 1.2 pc ( for mortgage business @ 1.9 pc )
30 DPD + @ 5.1 pc of the book

Q1 Outcomes -

Total income - 520 vs 491 cr, up 6 pc
Interest expenses - 218 vs 202 cr, up 8 pc
NII - 268 vs 250 cr, up 7 pc
Operating expenses - 174 vs 160 cr, up 9 pc
Credit cost - 27 vs 35 cr, down 20 pc
PAT - 75 vs 70 cr, up 8 pc

Cost to income - 57.6 vs 55.4 pc ( still elevated by NBFC standards )

Aim to open 100 more Gold loan branches in current FY - as the demand in Gold loan business is really strong

Aprox 83 pc of company’s borrowings are floating in nature. As interest rates come down, company should see benefits of lower cost of funds. Company’s incremental cost of borrowing in Q1 has already fallen below 8 pc

In Small ticket LAP business, company is rapidly strengthening its systems, augmenting its manpower and getting its leadership team right for the business. Company had turned a little cautious in this segment in Q3, Q4 of last FY due both - internal issues and some stress in this segment. They have normalised their disbursements in this segment wef Q1

Gold loan disbursements are surging ( led by both tonnage growth and price growth in Gold prices )

Guiding for a credit cost of 90-110 bps for full FY 26

For the near future - company’s and management’s focus is likely to remain on three verticals - Gold loans, Medium ticket LAPs and Small ticket LAPs. They don’t intend to venture into any other business till they achieve bigger scale and profitability in these 3 verticals

Small ticket LAPs + Gold loans are fixed rate products. Medium ticket LAPs ( 31 pc of loan book ) are floating in nature

However, since Gold loans are generally shorter term loans, they get re-priced rather quickly

Company generally re-prices its Medium ticket LAPs - once every year

Growth in Medium ticket LAPs continues strongly. It’s a seasoned business and the asset quality remains stable. WEF Q2, company expects growth rates in Small ticket LAPs to also start matching Medium ticket LAP business

Disc: initiated a tracking position, not SEBI registered, not a buy / sell recommendation, posted only for educational purposes

[ranvir]

Advanced Enzymes -

Q1 FY 26 results and concall highlights -

Revenues - 185 vs 154 cr, up 20 pc
EBITDA - 56 vs 51 cr, up 10 pc ( margins @ 30 vs 33 pc )
PAT - 40 vs 35 cr, up 16 pc. PAT margins stood at 22 pc

Segmental results -

Human nutrition - 122 vs 101 cr, up 21 pc. This segment represents 66 pc of company’s sales

Animal nutrition - 26 vs 17 cr, up 51 pc. This segment represents 14 pc of company’s sales

Industrial Bio Processing - 23 vs 25 cr, down 6 cr. This segment represents 13 pc of company’s sales

Specialised manufacturing - 14 vs 11 cr, up 29 pc. This segment represents 7 pc of company’s sales

Geographical break up of sales -

India - 53 pc, grew by 32 pc
US - 30 pc, degrew by 4 pc
EU - 5 pc, grew by 23 pc
Asia ( Ex - India ) - 9 pc, grew by 59 pc
RoW - 3 pc, grew by 61 pc

Company clocks highest ever revenues in Q1

RM prices largely remained stable throughout Q1

Company believes, the drop in Industrial bio processing revenues is a temporary dip and should reverse going forward

Company’s largest product - an anti-inflammatory enzyme’s ( serratiopeptidase ) sales stood @ 41 cr ( 22 pc of company’s topline )

Top 10 customers contributed to 27 pc of company’s sales

R&D spends @ 5 pc of topline ( very healthy levels ). May ramp it upto 6 pc or so

According to management, the growth seen in Q1 looks like being sustainable ( at the moment )

Have started commercial sales of biocatalysts in Q1 ( after a long period of trials ). Will have to see the sales momentum for next 1-2 Qtrs to judge the success and future growth prospects of the same

Guiding for a Grosss margin range of 73-75 pc for FY 26

Barring the tariffs related uncertainty, management is guiding for mid teens topline growth for FY 26

Company’s products are not categorised under Pharma products and are not exempt from tariffs

As of now, company has not been able to pass on the 10 pc tariff hike in the US mkt ( starting 1 Apr )

Company has spent a lot of time, effort and resources on R&D over last 3-4 yrs. They hope, the fruits of their labour should start maturing as they go forward ( like the 20 pc topline growth seen in Q1 vs a 6-7 pc topline CAGR growth in previous 3-4 yrs )

Company’s annual US sales that are shipped from India are aprox 50 cr ( they r the ones affected by tarrifs ). Rest - they have a manufacturing facility in US as well

Company has spent a lot of time, effort and resources on R&D over last 3-4 yrs. They hope, the fruits of their labour should start maturing as they go forward ( like the 20 pc topline growth seen in Q1 vs a 6-7 pc topline CAGR growth in previous 3-4 yrs )

Company’s annual US sales that are shipped from India are aprox 50 cr ( they r the ones affected by tarrifs ). Rest - they have a manufacturing facility in US as well

[saurabhgupta]

Sir thank you so much for providing such high quality concall summaries.I have learnt about so many businesses through your notes. Sincerely thank you from the bottom of my heart.Sir just want to know one thing- how you identify new companies (as you do not use Technicals) then how you come to know about such companies like- Fedfina, Advanced enzymes etc. If possible please share your framework to identify good companies.
Thank you

[ranvir]

I come across new ideas ( broadly ) via 3 ways - out of experience and some associated ground work, listening to good investor’s interviews on YouTube ( no shortage there ), luck

Ex - Digant Haria ( very knowledgable wrt financial companies ) in a recent TV interview said he liked FedBank Financial services because of their high yielding and fast growing Gold Loans business

Sajal Kapoor ( very knowledgable wrt Pharma and Healthcare sectors ) mentioned in a recent interview that he has been buying Advanced Enzymes recently

[saurabhgupta]

I too belief in luck as i myself enter this field of investing by luck and found many good people like you (by luck). Hardwork+dedication+luck. All are important and i saw each three of them in you.Thank you sir, hope one day i can reach to your level.

[ranvir]

Senco Gold -

Q1 FY 26 results and concall highlights -

Added 10 new stores in Q1 - 5 COCO stores ( including 1 Sennes store ), 1 FOCO and 4 FOFO stores. This takes company’s total stores to 186 ( franchise showrooms @ 76 ). Aim to add another 10 stores in current FY

COCO stores representing 63 pc of company revenues grew by 25 pc. FOFO / FOCO representing the remaining 37 pc of company’s business grew by 34 pc

Hallmarking of 9K gold Jewellery is now mandatory and should help support demand in the face of rising gold prices

FY 26 guidance - 18-20 pc revenue growth, 6.8-7.2 pc EBITDA and 3.7 - 4 pc PAT ( at the lower end of guidance, this translates to 273 cr of PAT vs 165 cr LY )

Q1 outcomes -

Revenues - 1826 vs 1416 cr, up 29 pc
Gross margins @ 19 vs 17 pc
EBITDA - 183 vs 108 cr ( margins @ 10 vs 7.8 pc ). Reasons - sharp improvement in stud ratio to 11.6 pc, tight control over costs
PAT - 104 vs 54 cr, up 91 pc
In Q1, Company reported a SSG of 19.6 pc

Geography wise breakup of stores -

WB + Kolkata - 101
NCR + North - 25
East ( ex - WB ) - 26
NE - 6
West - 9
South - 5
Central - 6
Dubai - 1
Sennes stores - 7

75 pc of company’s Jewellery is made in house - by a team of 186 - highly skilled karigars. Bengali karigars are known for their exquisite artistic work and talent. Out of rest 25 pc, aprox 20 pc is traded Jewellery and 5 pc is factory made

90 pc of company’s stores are leased. Only 10 pc are built on owned premises

Sennes stores focus on lab grown diamonds, other lifestyle products

Company sells its trendy Silver Jewellery under the GOSSIP brand, Men’s Jewellery under the Aham Brand

People are looking for light wt jewellery ( due sharp increase in Gold prices )

Old gold exchange is now 40 pc of company’s overall business vs aprox 25 pc 3 yrs ago - due high gold prices

Silver + light fashion jewellery is growing at rates > 60 pc

Gold coin sales out of company’s total sales is aprox 5 pc

Volume and value growth in diamond jewellery has been 36 and 54 pc respectively ( that’s rapid growth !!! ) - directly helping the company clocking better margins

Most of the 9K,14k jewellery sold by the company are studded with Daimonds / Other stones - hence end up having a higher EBITDA margins

LY - when the Gold prices were moving up from 60k to 80k, consumers were reluctant to buy studded jewellery and were insisting on buying gold jewellery on price corrections. This phenomenon is not being seen now - as the Gold prices have moved up further from 80k to 1 Lakh

Inventory on 30 Jun stands @ 3550 cr ( including gold, silver, diamonds, platinum etc ) - that’s roughly equivalent to 2 Qtr’s sales

Every percentage point increase in stud ratio inclines EBITDA margins by 30-40 bps ( roughly )

Primary sales in Q1 was 34 pc vs 24 pc secondary sales growth ( talking about franchise stores ). This is also because company has opened 5 new franchise stores in Q1

Most of the wedding dates in current FY shall fall in Q3 and Q4. Hence, Q2 may be a little soft

Early consumer response to 9k Jewellery has been encouraging

Henceforth, most of the expansion shall focus on Franchise stores ( aim to take incremental store opening ratio to 7:3 in favour of franchise stores vs 5:5 at present ) . This helps the company manage liquidity in a much better way and ensures 100 pc hedging. This is the model that Kalyan jewellers also followed with great success

Company’s main focus shall always be East and North India ( for foreseeable future )

Key risk : their hedging policy is not the best in class. I personally think, an improvement in this aspect is necessary for a sustained re-rating on the stock price

Disc : initiated a small position in Senco Gold + PNG Jewellers, not SEBI registered, not a buy/sell recommendation, posted only for educational purposes

[ranvir]

Action Construction Equipment -

Q1 FY 26 results and concall highlights -

Company is a mkt leader in Mobile and Tower cranes with > 63 pc mkt share

Company’s vast product portfolio includes - Pick and carry cranes, lorry loaders, truck cranes, rough terrain cranes, tower cranes, backhoe loaders, tele handlers, vibratory rollers, forklift trucks, warehousing equipment, access platforms, tractors, track harvesters

Company’s current capacity can generate an annual revenue of aprox 5000 cr Have lined up 300 cr of capex for FY 26. 100 cr for modernisation of existing facilities. Another 100 cr to start setting up facility to manufacture new types of cranes. Balance 100 cr to acquire land for future capex

ACE and KATO ( Japanese company ) have finalised a JV ( for making medium and large sized cranes ). This JV should start production in Q3 FY 26. This JV should start to generate 300-400 cr in revenues / yr wef FY 27

Q1 Outcomes -

Revenues - 703 vs 761 cr, down 8 pc ( including other income )
EBITDA - 143 vs 126 cr, up 14 pc ( margins expanded to 20.46 vs 16.56 - sharp margin improvement )
PAT - 98 vs 84 cr, up 16 pc

Sales de-growth led by price hikes due implementation of newer emission norms, early onset on monsoons. Expecting H2 to be much better

Margin expansion was led by - strategic pricing actions with new emission norms, soft commodity prices, deepening cost efficiencies

Segmental sales -

Cranes + Material handling + Construction equipment - 605 vs 690 cr ( 2337 vs 2951 units )

Agri equipment - 46 vs 42 cr ( 590 vs 495 units )

H1 generally contributes to 40-45 pc of company’s sales. H2 contributes to rest of sales

H1 generally contributes to 40-45 pc of company’s sales. H2 contributes to rest of sales

Company shall give a full year guidance only after Q2 results

Business is looking better in Q2 vs the sluggishness in Q1. Enquiry levels are nearing normalised levels

Export revenues for Q1 was 27 cr. Expecting exports to contribute to 6 pc of sales this yr and defence segment to contribute to 4 pc of company sales. Export margins are slightly better than domestic margins

Company believes they should close the year with some volume growth ( despite the sluggishness in Q1 ) coupled with price growth that has happened because of new regulations

Company believes. the increased gross margins seen in Q1 are sustainable

July 25 sales have been slightly below July 24 sales ( unlike the steep fall in Q1 )

Actively looking at inorganic expansions ( as they have a lot of surplus cash on books ). May materialise within FY 26

Anti-Dumping duties on Chinese Crawler and truck mounted cranes are expected to be imposed by the govt. Should be a key positive, if it materialises

Disc: was holding earlier, Re-entered recently, not a buy/sell recommendation, biased, not SEBI registered, posted only for educational purposes

[ranvir]

PNG Jewellers -

Q1 FY 26 results and Concall highlights -

Second largest among the organised Jewellers in Maharashtra. Maharasthra contributes to 17 pc of India’s Jewellery sales. Total store count now @ 55 vs 39 in Q1 FY 25. Q1 FY 26 stud ratio now stands 10 pc

Good demand seasons for purchase of bullion include - Post harvest seasons of Nov,Dec + Marriage seasons of May - June and Sep to Jan + festive seasons like Diwali, Dhanteras, Akshaya Tritya

Store breakup - 42 company owned, 13 Franchise stores

Q1 outcomes -

Revenues - 1714 cr, up 3 pc ( due discontinuation of low margin refinery operations. Refinery sales in Q1 LY were @ 335 cr ). Adjusted for discontinued refinery operations, Q1 sales were up 30 pc YoY

EBITDA - 123 cr, up 85 pc ( margins expanded sharply from 4 to 7.2 pc )

PAT - 69 cr, up 96 pc ( PAT margins @ 4 vs 2.1 pc )

Segmental breakup of sales -

Own stores - 1205 vs 1009 cr, up 19 pc
E Commerce - 66 vs 29 cr, up 125 pc
Franchise sales - 270 vs 129 cr, up 108 cr
Others - 17 vs 50 cr, down 65 pc

SSSG in Q1 @ 8 pc - due absence of Gudi Padwa in Q1 ( as it was preponed to Q4 this CY )

Opened 2 stores in Q1 ( 1 COCO, 1 FOFO ), taking total store count to 55. 7-9 new store openings are lined up for Q2. Company now intends to expand in MP + UP ( in medium to long term ). Should open a total of 25 stores for FY 26 ( out of which 10 stores would be LiteStyle stores focussing on lighter, more studded, more youth oriented jewellery )

By end of FY 26, company intends to be operating a total of 10 stores outside Maharashtra ( including 3 Goa stores )

Company has made dedicated efforts over last 5 yrs to start growing their Studded jewellery sales. They have introduced various new designs of diamond studded, Polki Studded, Kundan studded jewellery and are now seeing encouraging response. Now they r strong growth in these categories led by - smaller base, higher Gold prices

The store opening + inventory costs for a LiteStyle store are 8-9 cr / store vs 16-18 cr for a normal PNG store. Plus the margins in LiteStyle fashion jewellery are much higher than traditional Jewellery

Footfalls increased by 25 with 92 pc conversion ratio

Revenue per store @ 31.2 cr. Profit per store @ 1.3

Company incurred a hedging cost of 25 cr in Q1 - that’s a substantial amount

Demand in July in current FY have been descent - due stable gold prices + strong sales in Silver Jewellery

Store openings in Q2 shall include stores in Indore, Lucknow, Jalgaon, Dadar, 2 in Pune, Kolhapur and Kanpur

Gross margins in Q1 @ 13.2 pc. Company is hopeful of being able to sustain this going forward ( that would be quite an achievement )

Gross debt @ 854 cr, Investments @ 530 cr, Net Debt @ 324, Cost of borrowing @ 4.90 pc

Half of the 25 stores that company intends to open this yr shall be franchise stores - won’t require investments from company side. Another 5-7 shall be LiteStyle stores - which need much lesser investments

Company continues to remain 100 pc hedged at present

Gross margins in LiteStyle jewellery are aprox 26 pc ( almost double of corporate avg ). LiteStyle mainly focuses on 18K, 14K and Studded jewellery

Company makes a 3 pc gross margins on Franchise sales

Company should be able to sustain 3.5-4 pc kind of PAT margins on a full yr basis ( mainly due higher share of studded Jewellery )

By Mar 27, company aspires to cross a count of 100 stores. In case they go in for a QIP, they would aim for 150 stores by Mar 28. Otherwise ( without QIP ) , they should be able to reach 125 stores

In general, new stores take 12-18 months to breakeven ( within Maharashtra ). Can’t say yet about stores that they r going to open in UP, MP

Have guided for a topline of 9000 - 9500 cr with aprox 3.5 pc PAT for full FY ( assumption : on a sales figure of 9200 cr, company should be able to clock a PAT of 320 cr. At 40 times earnings, potentially - mkt cap can be 12800 cr vs current mkt cap of 7800 cr )

Company aspires to reach 12-13 pc Stud ratio. That should further incline the PAT margin

Disc: holding, inclined to add more, not SEBI registered, not a buy/sell recommendation, posted for educational purposes

[ranvir]

After studying Senco and PNG Jewellers, I personally feel that both are equally good businesses ( Senco - may be slightly better - due wider reach )

Where Senco falters is their suboptimal hedging policies vs 100 pc hedging being followed by PN Gadgil. No wonder, PNG gets a better valuation multiple. The day Senco starts hedging 100 pc of their Gold against mkt fluctuations, their stock price can literally re-rate overnight

Till then, I would be inclined to buy a little bit of Senco and more of PNG

Disc: views are personal, I m biased

[ranvir]

Kamat Hotels -

Q1 FY 25 results and concall highlights -

Revenues - 82 vs 74 cr, up 12 pc
EBITDA - 18 vs 13 cr, up 37 pc ( margins @ 22 vs 18 pc )
PAT - 4.3 vs 1.1 cr, up 290 pc ( finance costs are down from 11.4 to 6 cr )

Currently operational hotels -

Orchid Hotels - Mumbai, Lonavala, Pune, Shimla, Manali, Jamnagar, Chandigarh, Toyam, Goa ( out of these - 2 hotels are owned, 4 are leased, 1 is on a revenue share model and 2 are managed ). Orchid Goa and Orchid Mumbai are the owned hotels. Orchid Lonavala is a managed property

Ira by Orchid - Mumbai, Bhuvneshwar, Nashik, Shambaji Nagar, Ayodhya, Noida ( 4 are leased, 2 are on a revenue share model )

Lotus resorts - Konark, Murund ( both are leased )

Heritage hotels - Fort Jadhavgarh, Madhodadhi Palace ( both are leased )

Total - 19 hotels

Orchid - Chandigarh started operations in last week of April 25

Upcoming properties -

Orchid Hotels -

Rishikesh - Aug 25
Dehradun - Dec 25
Gwalior - Mar 26
Puri - Dec 26
Mandvi ( Kutch ) - Dec 27
Panchgani - Sep 25
Nahsik - Apr 26
Rishikesh ( second one ) - Mar 27

Ira by Orchid -

Hyderabad - Jul 25
Bhavnagar - Oct 25
Dwarka - Oct 25

Basically - there are 11 hotels in pipeline ( all on Leased / Renvenue share model ) to be opened by end of FY 27

65 pc of company’s sales come from repeat customers - indicating strong brand loyalty

Brand Wise ARR / Occupancy -

Orchid - Rs 6338 vs Rs 5384, up 18 pc / Occupancy @ 56 vs 61 pc

IRA by Orchid - Rs 5416 vs Rs 4590, up 18 pc / Occupancy @ 74 vs 62 pc

Lotus - Rs 5514 vs Rs 5020, up 10 pc / Occupancy @ 59 vs 51 pc

Fort Jadhavgarh - Rs 8051 vs Rs 7984 / Occupancy @ 30 vs 35 pc

First 15 days of May saw a sharp slowdown in Company’s properties like - Chandigarh, Manali, Shimla ( due Op-Sindoor ) - otherwise revenues would ve grown a little more

Orchid - Rishikesh should go live in Aug. Four more hotels expected to go live in Q3 @ Panchgani, Bhavnagar, Hyderabad and Dwarka. Basically by Dec 25 - company’s total operational hotels should reach 23 ( from 19 currently ). Another 3 hotels should go live in H1 of next calendar year @ Dehradun, Gwalior, Nahsik

Orchid Mumbai ( 370 rooms ) and Orchid Pune ( 410 rooms ) are their 2 large hotels - both doing exceedingly well ( managing hotels > 250 rooms requires good management skills - its a kind of testimony to their operational excellence )

Once the renovation at Orchid Pune is complete, it should do even better ( + they are adding 2 more banquet halls there )

Should be able to clock at least 29 pc kind of EBITDA margins for full FY ( as was the case LY )

Aiming to hit a topline of > 500 cr for FY 27 - since a lot of hotel additions shall happen between now and Mar 27

Company is targeting an avg ARR of 14-15k @ their new Rishikesh property going live this month. Its a premium hotel with excellent location

Should be able to do > 400 cr of revenues for FY 26. Management agreed their guidance is on the conservative side

Company’s Gross debt at present is @ 96 cr ( vs 105 cr on 30 Mar ) @ 10 pc rate of interest. Company aims to bring it down to 9 pc

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation, posted for educational purposes only

[ranvir]

Glaxo Smith Kline Pharma -

Q1 FY 26 results and concall highlights -

Revenues - 805 cr, down 1 pc
EBITDA - 251 cr, up 9 pc ( margins @ 31.2 vs 28.3 pc - significant margin expansion )
PAT ( before exceptional items ) - 205 cr, up 12.7 pc ( PAT margins @ 25.7 vs 22.8 pc )

Company’s general medicine portfolio was impacted by softer than expected seasonality tailwinds ( specially for their topical derma business )

Speciality segment growth led by - respiratory portfolio ( Trelegy + Nucala ), Vaccines like - boostrix, Varilrix and Havrix, Shingrix ( adult vaccine ) also grew strongly

Upcoming launches - Zejula ( to treat ovarian cancer ), Jamperli ( to treat endometrial cancer ) - likely to be launched in Aug 25 - invested a lot in Q1 behind pre-launch preparations for these two speciality brands

Shingrix prescriptions grew by 20 pc an a QoQ basis

Company lost 2 pc of sales because one of their CMO partner was hit by a fire incident ( mostly for Calpol - lost 12 cr worth of Calpol sales )

Vaccine volumes growth in Q1 stood @ 8.6 pc, general medicines volume growth stood @ (-) 2 pc

Ovarian cancer - is second most common form of gynaecological cancer. Should have a patient pool of 5000 patients / yr to be treated with Zejula in India. For Jamperli this number should be around 1000 / patients / yr

Company has already on-boarded the MRs for Zejula and Jamperli. All the pre-launch preparations have been made

Company saw a significant volume decline in their topical derma ( corticosteroids like Betnovate etc ) business in Q1. Have started to see better offtakes wef Q2

Revenues from Zejula and Jamperli should start reflecting in company’s financial results wef Q2

Company has covered a total of 1200 oncologists for Jamperli and Zejula. Both shall be launched on 15 Aug

Cost of treatment with Jamperli / patient shall be around 12-18 lakhs ( depending on no of cycles that a patient may end up needing ). Cost of treatment with Zejula is also similar

Zejula in India is approved for second line treatment. Should get approved for first line treatment in near future

Shingrix is clocking a monthy sales of 9k doses / month - all in the private market ( that amounts to a sale of aprox 8 cr / month for the company )

Still committed to a double digit topline growth for full FY 26 - on the back of Q2 + Q3 ( best Qtrs for the company ) and new Onco launches

Company’s innovative RSV vaccines ( used to prevent respiratory disease in ppl aged > 60 ) are slated for a global launch in FY 27. Company also intends to bring them to India - sometime in future

In terms of general medicine, aprox 40 pc of formulations are made in house and rest 60 pc are sourced via CMO partners. Newly launched Jamperli, Zejula are imported

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation, posted for educational purposes

[Sudhakar_Subramanian]

@ranvir sir,
Thanks for sharing your knowledge on the companies you follow. I wonder how you even manage to go through these many companies results and concalls. Hats off to you.

Could you share your latest pf and allocation percentage?
Thanks in advance.

[Krishna_Kumar]

@ranvir

After studying Senco and PNG Jewellers, I personally feel that both are equally good businesses ( Senco - may be slightly better - due wider reach )

Hi, after going through the concalls, how will you rate both CFOs (Mr Firdauz and Mr Sanjay) given both promoters should be little more finance literate?

[ranvir]

My biased view : not hedging completely in a Jewellery business is hurting Senco’s valuations. Don’t think Mr Sanjay Banka is doing a good Job

[ranvir]

Ajanta Pharma -

Q1 FY 26 results and concall highlights -

India business -

Breakup of Company’s India branded business ( totalling 1452 cr in FY 25, growing @ 16 pc CAGR in last 4 yrs ) -

Cardiac - 37 pc
Opthal - 30 pc
Derma - 23 pc
Pain management - 10 pc

Q1 India sales @ 409 vs 353 cr, up 16 pc

15 of company’s brands clock sales > 25 cr. 55 pc of company’s India sales come from top 10 brands. 65 pc of company’s India sales come from Chronic therapies ( a key positive ). Only 11 pc of company’s India products are under NLEM

Launched 8 new products in India in Q1 out of which, 1 product was first to market

In Q1, Ajanta’s India business grew by 10.2 pc vs 8 pc growth for IPM. ( breakup of Ajanta’s growth - 2.5 pc volume + 4.4 pc price + 3.3 pc price )

Asia + Africa branded business -

Clocked a combined sales of 1191 + 750 = 1941 cr ( growing @ 15 pc CAGR over last 4 yrs )

Launched 12 new products in these markets in Q1. Company’s main therapy segments in Asia + Africa include - Cardio, Anti Diabetic, Opthal, CNS, Derma, Gynae, Pain Management and Anti Biotics

Q1 Asia sales @ 304 vs 277 cr, up 10 pc
Q1 Africa sales @ 228 vs 230 cr, down 1 pc

US generics business -

Clocked a sales of 1047 cr in FY 25 ( has grown @ 13 pc CAGR in last 4 yrs )

Company has an approval for 53 ANDAs and has 47 products on the shelves. Targeting to file another 10 products in FY 26

Q1 US sales @ 310 vs 228 cr, up 36 pc

Africa Institutional business -

Has been in steady decline for quite sometime now

Q1 Africa Institutional sales @ 38 vs 42 cr

Q1 consolidated outcomes -

Revenues - 1303 vs 1145 cr, up 14 pc
Gross margins @ 79 vs 77 pc
EBITDA - 351 vs 330 cr, up 6 pc ( margins @ 27 vs 29 pc - margin compression due steep jump in other expenses from 263 to 373 cr - up 42 pc )
PAT - 255 vs 246 cr, up 4 pc

Notes from management commentary -

Company’s Africa branded business is expected to see moderate / low growth in FY 26 due high base of last FY

Launched 10 new products in Asian Mkts + 2 new products in African mkts in Q1

US growth in Q1 was led was 5 new launches made in last FY. Also launched 1 new product in Q1. Another 2-3 launches are lined up in rest of FY 26

Full yr GMs are expected to be 78 +/- 1 pc

R&D expenses in Q1 were @ 4 pc of sales. Expected to move upto 5 pc of sales for Full FY

Elevated other expenses are due to company’s renewed thrust towards their branded generics business + 25 cr of MTM forex losses. The aggressive investments behind branded generics are likely to continue for rest of FY 26 as well. Excluding the forex loss, PAT would ve grown by 12 pc

Guiding for a full yr EBITDA margins of 27 pc ( similar to FY 25 )

Capex projected for full FY @ 300 cr. Spent 72 cr out of this in Q1. Out of this, aprox 150 cr is going to be spent on maintenance capex. Rest shall be spent on the liquids facility - targeted at Asia and African mkts

Gross margin improvement in Q1 was due to better product mix

Have added 40 MRs in Asia + Africa in Q1. Planning to add another 210 MRs in these regions by the end of FY 26. So the total MR count in Asia + Africa should rise from 2000 to 2250 by end of current FY

US business should sustain @ Q1 levels for rest of FY

Guiding for mid teens growth for Asia business, IPM + 2-3 pc growth for India business, mid to high single digit growth for Africa business for FY 27 ( despite a flat Qtr 1 for Africa business )

EBITDA margins should expand in FY 27 as most of the accelerated other expenses incurred in FY 26 should be behind

Have added 70 MRs in India business in Q1. Aim to add another 70 MRs for rest of FY 26 for India business

Actively on the look out for inorganic growth opportunities

Disc: holding, biased, not SEBI registered, posted only for educational purposes

[ranvir]

Eveready Industries -

Q1 FY 26 results and concall highlights -

Revenues - 374 vs 349 cr, up 7 pc
EBITDA - 53 vs 49 cr, up 8 pc, margins @ 14.3 pc
PAT - 30 vs 29 cr, up 3 pc ( 7 cr were paid as ex-gratia to workers on separation. adjusted for that, PAT would ve grown by 22 pc )

Segmental breakup of sales -

Batteries - 239 cr, up 10 pc. Revenues from alkaline batteries jumped to 20 cr, up 60 pc YoY. Company’s mkt share in Alkaline batteries now @ 15 pc. New plant for Alkaline batteries at Jammu should get commissioned by end of FY 26. Company’s overall mkt share in Alkaline + Carbon Zinc batteries stand @ 58 pc

Flashlights - 67 cr, up 13 pc. Rechargeable flashlights revenues stand @ 26 cr, up 40 pc YoY. Rechargeable flashlights saw healthy traction in both modern trade and E Comm channels

Lighting - 78 cr, down 4 pc - impacted by continued price erosions

A&P spends @ 3.8 pc

Mandatory BIS certification is helping the organised players drive growth in flashlight category

Company has now on-boarded 250 distributors for its Lighting business. Have also added Switchgears and Wires to their product portfolio in Q1

Segmental EBITDA margins for Q1 -

Batteries - 19 pc
Flashlights - 13 pc
Lighting - breakeven

Embargo on the company wrt asset disposals / fund infusions etc have now been lifted post favourable award of judgement after a long drawn arbitration battle

With the kicking in of BIS certification, a double digit growth in Flashlights over the medium term should be doable

Company’s share in Alkaline batteries in June 24 was @ 10 pc vs 15 pc now - a huge jump over last 1 yr. Most of the gains have been led by company’s strong distribution in Zn-Carbon batteries - hence they find it easier to cross sell their alkaline batteries too

Because of the arbitration settlement, company can now dispose off surplus land banks that it holds. Company would dispose them in due course of time

The Greenfield Jammu facility’s production shall also be sold to other brands. Company is also planning to export alkaline batteries once its plant gets comissioned

Aim to grow the topline in high single digits for full FY 26 ( despite price erosion in lighting business )

Disc: hold a small position, not SEBI registered, not a buy/sell recommendation, posted for educational purposes

[ranvir]

Broad portfolio breakup -

Positions > 2-3 pc of portfolio weight -

Aditya Vision
Electronics Mart India
Cello World
Crompton Greaves consumer electricals
Dhanuka Agritech
Dodla Dairy
Heritage foods
Eris Lifesciences
RPG life sciences
Mankind Pharma
Hindustan Zinc
Rainbow Children’s Medicare
Yatharth Hospitals
Narayana Hrudayalya
Insecticides India
Karur Vysya Bank
Nippon Life AMC
Lumax Auto Technologies
SAMHI Hotels
East India Hotels
Time Technoplast

Positions < 2 pc of portfolio weight -

Wonderla Holidays
Windlas Bio
Taj GVK Hotels
Sandhar Technologies
Phoenix mills
PN Gadgil Jewellers
Orient electric
Adani Ports
Ajanta Pharma
Alkem Labs
Blue Jet Healthcare
Cholamandalam finance
IIFL finance
Colgate Palmolive
Elecon Engineering
Zydus Lifesciences
Entero Healthcare
HBL engineering
GSK Pharma
Abbott India
Hariom Pipes
Indraprastha Medical
Jyothy Labs
Kamat Hotels
Kotak Bank

Tracking positions ie < 1 pc of portfolio wt -

Sarda Energy
Sumitomo Chemicals
Senco Gold
Five Star business finance
FedBank Financial services
Eveready Industries
Elin Electronics
Akum Drugs
Alivus Pharma
Amrutanjan Healthcare
Kopran
Krsnaa Diagnostics
Action construction Equipment

Disc: I keep adding / reducing portfolio weights all the time ( while maintaining overall portfolio balance in favour of companies where I have more conviction ). Posted only for the purpose of transparency

I know, it’s a long list. It is what it is

[saurabhgupta]

Sir bow down for your hardwork, consistency and more imp Honesty and Transparency. We need such type of mentors in our life. Thank you so much for being a guiding light for me. Sukriya sir ji🙏