Sahil's Portfolio

@sahil_vi, I am just curious, since you emphasize so much on sunrise sectors and avoiding sunset sectors, why not also avoid sunset countries? Why invest in US when India itself is full of opportunities?

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Us companies which focus domestically are a clear avoid for me.

Us companies that are dominating the world are sunrise in nature because of the sector.

Eg: Tesla for EV. one canā€™t find an equal. They are at cutting edge of innovation, science r&d for batteries, EV, business model, insurance, lithium mining, & self driving tech. Itna competitive advantage wala company milega nahi India mei. Due to which Tesla is able to compound at 50% cagr in past, present & future. Show me 1 other co which is expanding into 2 different adjacencies (robots, fsd), is efficient with its r&d, is a category creator, and growing its core business at 50% cagr. I canā€™t find 1.

I invest in USA for higher alpha , for globally dominant companies that can grow at 30% minimum globally & enable me to position to global innovation in addition to Indian innovation. It also serves as a nice hedge against rupee depreciation. That is just an added bonus.

Globally dominant monopolistic companies have a naturally larger playfield & access to cheapest capital in world & the best talent in world and hence are thus able to compound at rates which Indians companies can only dream of.

It also does not hurt : that the US market being so absolutely huge, i have not seen individual companies being bid up in usa the way they are in india. Hle glass neogen, Navin at 70-100 time earnings is simply ridiculous & occurs only because Indian investors donā€™t find too many good ideas & thus tend to crowd into the few that exist. Contrast that with companies like Tesla & evolution available at 40 time earnings growing at 40-50% itā€™s topline & expanding margins, global category creators, global innovators. The scarcity premium Indian cos get is actually fairly disadvantageous for investors because it tends to go away as fast as it came. Just look at vaibhav global fall from grace from 60 pe to 20. Sequent scientific from 6x sales to 1-2x sales. A crowded trade (we can soothe our nerves by calling ourselves investors: i am included in that list, but unless we are invested for dividends in a robust co for decades, we are traders) can only Lead to stampede.

Disclaimer: invested, biased.

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I agree with you on existence of some unique companies in US. Do you invest via US/Fang/Nasdaq based ETF in India or directly in US? If one wants some exposure to these companies, what are your thoughts on NASDAQ focussed ETFs in India?

Inspite of all the uniqueness these companies had dramatic fall - Netflix, Amazon and even Teslaā€¦ generally great companies do not fall this much (exceptions are usually in tech, where I have seen wild swings irrespective of the goodness/greatness)ā€¦ Is this fall an opportunity to buy such companies or we might expose our portfolio to heavy volatility in such tech names (unless we sell in short/medium term)ā€¦also what should be ideal allocation % to such unique names as per youā€¦Thanks

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Doesnt make sense at all to club Tesla along with Netflix, amazon, Facebook etc.
Teslaā€™s dominance is unmatched.

Beyond ā€˜carmakerā€™ tag, investors have been able to understand their unassailable lead in cutting edge AI, material science, battery technology & chip design, giving them immense optionality (Insurance, Energy, robotaxi, autobidder, botsā€¦) with massive TAMs.

Whereas, Netflix needs huge budgets to keep producing blockbusters, aws is under attack both from gcb, azureā€¦ Facebook core business is loosing active users thick n fast & investments in metaverse hav no clarity on returns.

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TAM for US companies is the entire world and for most Indian companies it is India. US tech coā€™s will make a comeback, tech tide cannot be counted under sunset industries in my view.

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Agree that is for now, until todayā€¦similarly as once these other companies were of similar leagueā€¦btw all these cutting edge research and high tech of Tesla you mentioned also require huge investmentsā€¦

I think very soon, lot of dominance of companies like Tesla would be challenged from various companies around the worldā€¦you would be surprised some of them would come out of India as wellā€¦until then I agree that Tesla maybe having more moat than other tech firms in USā€¦

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Agree, there is a reason for thatā€¦with those Indian companies getting the kind of growth they desire in Domestic market, they need not bother about rest of worldā€¦while those US companies that come to Indiaā€¦come here in search of that very growthā€¦

When time is right, I see many Indian companies venturing to US markets and dominating their as wellā€¦when they want, they would do itā€¦

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Q4FY22 04:00 mt:f:g 2-3 customers in Europe & usa to operationalize in q2&Q3 fy23.
Q4FY22 04:30 lt:f:om co is focussing on solar plant to save power costs. partly operational by aug 22 & partly before end of fy. slight delay due to govt approvals.
Q4FY22 05:00 lt:p:biz 45% dependence on passenger vehicle in fy19. down to 40% now. ev contribution up to 7% in current FY. ev part could go to 12-14% in next fy.
Q4FY22 08:00 mt:f:ri cdr loan has almost been paid off. about 25 cr of cdr debt is remaining. planning to pay it back in next 2 years. 0.37 debt/equity ratio
Q4FY22 12:20 lt:p:om 50% of our customer FOV basis. rest 50% they pay extra logistics costs. every 3 months we share logistics costs with the customers.
Q4FY22 13:30 lt:f:om 4.5 mw to be operationalized before sep -22 & 11.5 mw to be operationalized before mar-23.
Q4FY22 15:00 mt:p:wc both receivables & inventory has gone up. due to fast growth in last Q. need to have inventory. fluctuations in rm prices. down the line we will maintain 75 days of inventory. right now 90 days of inventory. will maintain 80-85 days receivables. have reduced payables too. results in better margins
Q4FY22 18:00 lt:f:ca installing new machining & heat furnace lines. they can give 4-5x asset turnover since forcing capacities already exist which wil feed into them.
Q4FY22 18:40 mt:p:biz europe is 35-40% revenue. forex & raw material are both pass through. so we are revising pricing every Q with customers.
Q4FY22 21:30 mt:f:tg We have order book visibility of 115-125 cr on monthly basis.
Q4FY22 21:50 lt:p:mo all our customer relationship are long term these are long running programs. each contract is 5-8 years. these are semi finished products.
Q4FY22 23:00 mt:f:tg based on last Q, we are hopeful of crossing 1250 cr sales in fy23
Q4FY22 25:40:00 lt:f:tg can grow 15-20% after next year. most of our customers renc. one of our leading customs has added bulgaria, Italy, Mexico. We have started submitting samples. July onwards, annual revenue we wil have 100cr. industrial bearing customer in America. one of gear box manufacturing customer. 95cr annual biz currently will grow from 40cr currently.
Q4FY22 27:30:00 mt:pa:tg out of 65% growth this fy, 28% was volume growth.
Q4FY22 27:55:00 lt:p:tg We have been awarded programs gradually from existing customers. got 6 components from a customer in q3. got another 8 components in q4. new customers will operationalize form q2 & Q3. existing bearing customers one of largest bearing co: added Germany, bulgaria, Mexico, Italy.
Q4FY22 29:00:00 lt:f:tg donā€™t expect much traction from ev in immediate future. developing new components for ev. earlier were supplying to same customer usa factories & now supplying to their europe factories.
Q4FY22 30:20:00 lt:p:tg We are not making any engine components. We are more into wheel, transmission, bearing components. so risk of ev is less for us. apart from this, earth moving, windmill, off highway, railway. railway is growing. most components we make for auto will be used in ev also.
Q4FY22 31:30:00 lt:f:tg auto will become 50% of revenue down the line.
Q4FY22 31:50:00 lt:f:tg aspirations is to have > 1700 cr revenue by fy25
Q4FY22 33:00:00 lt:f:nm until fy22 we were under mat regime. We are inclined to shift to new tax regime in fy23.
Q4FY22 34:20:00 lt:p:ca capex : solar, maintance, new facilities: 30cr capex. solar 6cr capex. fy22 was 69 cr capex.
Q4FY22 35:30:00 lt:f:tg Ukraine war is an opportunity for us. our client added us for Germany plant all that happened due to Ukraine war. also now they are paying tooling costs which they were not paying us earlier. earlier customs had a plant in Ukraine that is now stopped.
Q4FY22 37:00:00 lt:f:tg earlier Tesla biz of our customer they were sourcing from China. they shifted to Rolex. now they have added Tesla for europe bulgaria Italy. earlier they were sourcing from China. so china+1 is really playing out.
Q4FY22 38:00:00 mt:p:tg domestic is getting back now. last Q requirements were less due to the chip shortage, but how we are starting to see higher requirements
Q4FY22 39:10:00 mt:f:ri cdr long term debt already paid off. process to close will be intiated in Q1 & close in q2.
Q4FY22 41:00:00 mt:pa:tg consumed 68,000 MT in this fy.
Q4FY22 41:50:00 lt:f:tg PSA point venture will produce for global engine in india. already started supplying that plant. We got new export biz from that plant. domestic is fully ramped up. overseas plant we are at stage of supplying validation batches.
Q4FY22 42:30:00 lt:f:tg forging : 60% capacity utilisation. machining we also outsourcing it. 80-85% capacity utilisation.
Q4FY22 44:00:00 lt:f:om ā€œ22-23% margins, conservatively Iā€™m telling you, we are
going to stick on these margins. 1-1.25% margin went down due to export incentive going away but still maintained margins.ā€
47:00:00 lt:f:tg When steel prices fall it can impact pricing & reduce topline growth even though volume will go up.
48:00:00 lt:f:mo the kind of components we are supplying we are the sole supplier to the particular customer. both auto components & bearings, they are paying huge amount of tooling cost for development of the bearing rings. In other branded bearings, we have 55-60% market share.
52:00:00 lt:p:mq at ipo time had given guidance of 1250 cr for fy23. Despite order wins giving same guidance now because we want to be conservative in giving guidances there are many headwinds like ocen freight, commodity pricing

q3fy22 02:00 st:pa:tg average revenue in last 2 months we have already recorded 100cr. expecting q4 to have similar runrate. expect to meet guidance of 1000 cr revenue
03:00 st:p:om expected to maintain 22.5% to 23.5 % ebitda
04:40 mt:p:tg usa bearing ring segment, europe auto components customer we were able to bag. global mnc customers ramp up from Q3 & double revenue in fy24. existing customer with plant in Europe gave us new components.
05:50 lt:f:om solar power project. already installed 4 mw on ground. getting final consent & approval. another 10-12 mw will be installed. July onwards expect supply.
07:55 lt:f:tg We would be 8% of revenue from ev & hybrid by fy22 end.
09:10 lt:f:om entire cdr has been paid. covid loan 28 cr out of that repayment made. in next 12-18m will repay. aiming to be net debt free.
12:00 st:f:tg expect dispatches of 200cr in next 2 months, dispatches of 300 cr in q4 & revenue of 270 cr from components & scrap due to in transit goods & 280 cr for total revenue
14:00 lt:p:biz 65% bearing 60% exports.
14:30 lt:p:biz growth in commercial & industrial applications which is 60% of revenue we expect good demand from there. if semicon availability to get addressed then passenger vehicle can also do well.
15:30 lt:p:om key rm prices have not moved in Q3 much. We are able to pass near 100% pass through for commodity pricing to export customer on quarterly basis & domestic on monthly basis
23:30 lt:f:tg when steel prices go, not much impact on topline growth.
26:10:00 lt:f:biz We have big piece of land in Gujarat. announcement of mou, government would support by doing infra development which increases marketibility of our land parcel. that is logic behind textile park announcement
26:30:00 lt:f:ca doing capex for solar, machining lines, furnaces, 20 cr, maintance capex, annually required, apart from that no substantial capex in next 2-3 years. money freeed up will be used for wc & repaying debt (working capital). if big opportunity comes to us we will order some equipment
28:30:00 lt:f:tg for same customer developing new components. our focus is to Target ev customer & supply parts to them. one of our main custome is into heavy commercial vehicles. after 1.5 years we will have those revenue also in topline
06:10 mt:f:biz expect to close cdr in q2 or Q3 many bankers involved maybe 6 bankers.
33:10:00 lt:f:tg expect to achieve 1700 cr on current gross block expect to achieve in fy25
37:10:00 lt:f:biz 16 mw solar power plant. it would hardly give me 35% of power consumption. rest i get from discom. 90 lakhs / mw / year savings.
38:30:00 lt:f:ca 56% capacity utilisation. 58% by end of current fiscal capacity utilisation
41:10:00 lt:p:tg we make generation 3 bearing. hub & bearing combination. We have a korean company in Pune we are their 60% supplier. they are increasing their volume. 2-3 more customers are ready for gearboxes. 1 customer usa makes industrial bearing we expect 50-60 cr industrial bearing order next fy.
42:30:00 lt:f:motg 2-3 mnc bearing co in india. large dia like windmill railway earth moving equipment. one we are 60% supplier in india. other 2 customers are also expanding capacities in india. in india we are expecting import substitution. moving overseas facilities & moving equipment to India. large bearing they make in India
44:00:00 lt:p:om ebitda is higher when we have critical or value added process. critical bearing ring we might have 25% margin. in commodity it might be 20% ebitda margin. in auto components it might be 22-25%.
46:00:00 lt:f:om right now we have 56% capacity utilisation. once it touches 70% we do expect margin improvement. but conservatively we are telling that it is going to be 23% +
48:50:00 lt:f:tg fy24 expecting 1400-1500 cr revenues.
49:30:00 lt:f:tg hybrid & ev requires higher precision because there are fewer components. so there are definitely higher margin in ev & hybrid. value addition is higher due to precision & process not material.
q1fy22 02:20 lt:p:mo one of the top 5 forging companies by installed capacities in india. 163 kg single components we can produce. 20mm to 900mm bearing ring.
04:20 lt:p:biz 3 manufacturing facilities in Rajkot.
05:20 lt:p:mo there are 5 large bearing manufacturers in india & all these 5 players are the customers of Rolex rings. long association with them : 10-15 years few of them 2 decades. electricity & labor are great in Gujarat. port availability is good in mudra kandla
07:00 lt:p:om 8.75 mw windmill which can compensate 15% of electricity. initiated 16 mw solar project which can compensate 35% of power requirements. power is 2nd largest cost after material in our p&l.
11:10 mt:f:tg hopeful of surpassing our 2019 revenue & touching 1000 cr this fy
12:00 lt:f:nm will repay full cdr loan by December & will repay covid 28 cr loan too in next 2 fy.
15:30 st:p:biz 210 cr product sales & 17 cr of scrap sales, other income & windmill income.
18:20 mt:p:biz domestic auto used to be 5% is 12% now so definitely increasing
24:10:00 st:p:ca 52-53% capacity utilisation in this quarter
26:20:00 lt:f:tg 4% of revenue in current quarter from ev. could be 10% in this fy. in ice 16-18 bearing required. but in value terms it might be equal to current cost of components due to higher value added nature of ev bearing.

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How do you decide which concalls to listen during walk?

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Based on 2 parameters :

  1. Highest priority is cos which i already own. Eg: racl gear tech
  2. Second highest is new cos which came to my notice. I also regularly stalk trendlyne & alpha street YouTube channels to see latest concalls & investor calls they have uploaded to see if any are very interesting. Eg: affordable robotics
  3. Third highest priority is conpetitors or clients or suppliers of cos I own or am interested in. Eg: timken for Rolex rings
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@sahil_vi Thanks a lot! This will help a lot of investors.

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Some good news for the company

In a time when every company is lowering their guidance inmode is Expecting record sales in q2 and full year over all from what management had guided before.

https://www.sec.gov/Archives/edgar/data/1742692/000121465922002643/d211221sc13ga1.htm
Dr mulholand one of the renowned plastic surgeons in canada has taken a very big position in inmode roughly 9.79% of total market cap

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Hi @sahil_vi would love to hear your insight on IDA

Hi @sahil Sir.
Your contribution to this forum has been invaluable. The amount of information you have provided in this forum is going to help thousands of members in coming years.
I had a few questions to ask from you and I would be grateful If you could answer them.

  1. Sir you have mentioned your portfolio size is 8 digit so, I wanted to know what percentage of your portfolio(invested amount excluding notional gains) is from profits from market. I donā€™t want you to share precise numbers a rough estimate with Ā±5% would be fair enough.

  2. Sir as of today you are 28years and assuming you started earning at the age of 22years. You have reached an 8digit figure just in 8 years of your earning phase. This has been predominantly because of you earning high and saving high as well.
    Sir my second question is what percentage of your annual income you have been able to save over the years.

  3. What I am trying to derive is being financially prudent and having a big source of earning is as important as having good investing knowledge.

  4. Sir how much, you being a software engineer has contributed in your investment decision. What I believe is in todays world if you have good investment knowledge, have higher income and on top of that you are techno savvy thatā€™s a deadly combination.
    Data analysis is the next big thing. Sir I would also want you advice if I should be working a little bit on the IT part as well based on your experience as to how much IT as helped you.

Sir from all the above questions I am trying to analyze that to excel in this field is it only the knowledge you need or there are many more aspect which matter as well.

Sir if you donā€™t wish to answer any of the above question I totally understand I do respect you on that. Since i didnā€™t find any other topic to ask these questions that is why I am asking this under your portfolio.

I would be grateful if you could answer the above questions.

Sir just one last question to add. I have lot of interest in Financial space epically banks. I have a decent base but donā€™t know how I can go to the next level . If you can advice me what all steps I need to take to take my understanding in this space to the next level.

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Just curiousā€¦ 10 months into this betā€¦ Where does ur portfolio stands vs the others who took the betā€¦

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Hi @sahil_vi, can you recommend some resources to help me learn more about banks please? Thank you for your contributions to the community.

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Hi @sahil_vi

What does your current portfolio look like?

Just wanted to understand how does a seasoned investor like yourself adjusted their portfolio during the bull cycle after COVID and the crash after that.

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@sahil_vi pls update your current portfolio , you have done many changes if your portfolio i assume

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twitter.com/sahil_vi
He regularly posts his portfolio additions removals and thoughts on twitter.

Just came across the below shareholding pattern on screener for Rolex Ring. Huge increase in DII stake during Jul-Sep quarter
4 fund houses (PGIM, DSP, Aditya Birla and ICICI Pru) made a fresh entry whereas 2 fund houses increased the stake. A couple have sold out as well. But overall FII (stake size almost doubled) and DII have turned super positive

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