RHP / AR mentions related party transactions on the subsidiary Shop – Neetu's Delight and related company Neetu Realty under Facility Service charge, Rent for leased land, and Construction cost. I think these are under limits though, but couldn’t find any arm’s length basis report.
But the realty company was incorporated just before IPO, and Shop – Neetu's Delight seems like a site put up simply. Are these red flags, considering the RPT money goes to promoters pvt entities?
Also unclear on 1) How the promoters got connected with KS Chandra, which I believe is the moat (along with the 7.5% lifetime tax benefit compared to peers). 2) how promoters’ with no railway related background (education / work experience / family history) got interested in railway scrap trading.
This was my first full year as full time investor, I quit work mid last year, I dont know what it actually means to be full time investor , but I no longer have to pick calls or go places or attend meetings which I do not wish to. I also got enough time to take care of my health and family, I do spend 1-2 hrs per day in Gym/outside activities including weekend treks. I read almost 8-12 hrs a day Almost everything that comes up on my list of stocks, I do track a very large list of stocks possible 1000+ , though it very hard to keep track of everything and also is pointless to do so. But I still like to track as many and maybe deep into 200-300 of them in a given year. I also got to visit 4-5 factories some listed some unlisted, which I plan to increase more in 2026 if needed. This year also has been my worst performing year in absolute terms goes on to say how much luck is involved to succeed in stock markets as you can do all you want but market can still humble you.
Why this Thread
When I started this Topic in May 2025, the idea was to put some of my con-call notes publicly so that its not lost and is useful for the community as most of these stocks are not well tracked and dont have/deserve their thread of their own yet.
Also another aspect was to get the list of Businesses which looks to have good runway ahead and also there is some confidence on the management that they wont have Major CG issues. Though its very days as to verify these on CG , we will continue work and bring out the necessary info to assess these qualities.
Eventually one of the members would start the topic with its own thread
Accomplishments
I am glad to observe we almost had 1 stock idea being discussed every month so far which was never discussed earlier publicly.
Apart from succeeding in the above 3 objectives, what else what achieved ?
We got most of the stocks being critiqued in a healthy manner and bring out the red/yellow flags apart from the green flags. This helps in further research and deepen our understanding of the business and management.
Hits and Misses of this thread, though its early days , thought to have this table running for the year end.
Stock Idea
Discussed at
CMP as on year End
Envirotech
108
120
Stallion Fluro
75
250
Obsc
230
302
Neetu Yoshi
120
108
JayKay
235
195
FlySBS
530
530
AFCOM
870
920
Influx
165
235
Thanks to all the members and readers of the Forum for your deep dive contributions. Wishing you all Happy and Prosperous New Year 2026 !
I’m slightly confused about your first point about Neetu Yoshi.
From DRHP and concall notes, it seems they have existing plant in Bhagwanpur (Haridwar), which has not shifted but undergone capacity expansion (from 4,493 MTPA in FY24 to 8,087 MTPA as of July 2024).
What has shifted is a planned new Bogie plant, from Kanpur to Haridwar. In latest concall, management has explained multiple times that this is due to new RDSO inspection facility in Delhi (thus no dependency with RDSO Kanpur).
The new plant has recently started construction and according to Concall will be operational from April 2026. So it’s not like they shifted any existing manufacturing.
However I do agree that we always need to be extra cautious with aggressive SMEs like this.
Let me take this chance to say that this thread is a goldmine. Many thanks to Satish and everyone who contributed.
Discl: Recently invested with just 1 lot. Will likely take next course of action after H2 result.
Thank you for this thread for an insight in to SME stocks not discussed anywhere else in this forum.
Some general questions to get an insight in to your investing style and system. Please feel free not to answer if they are too intrusive.
Do you maintain a portfolio thread ? And what are the major non SME stocks you have? How many stocks you are holding in your portfolio and how do you describe your overall investing style?
Also what percentage of your equity porfolio you allocated to SME Stocks?
Thanks in advance for this thread and moderating activities you do in this forum and views here and elsewhere.
@james_kerala For me the difference between SME and Main board stocks is around the Compliance requirements (CR) by SEBI. SME stocks have lower CR than main board hence prone to have higher probability of corporate governance (CG) issues than Main board stocks.
Some companies showcase higher CG standards ex: TaraChand , All E tech, Gargi. And some companies are on the verge of moving to Main board where they have already applied for the transition. Such stocks I would consider as part of my Main board portfolioitself as I am comfortable with their CG standards..
I have around 25% allocation to SME ( including gargi/ influx and others which have higher allocation) as of now and it changes +/- 5%.
I prefer not to have portfolio public and hinder my decision making process.
I have more than 100+ stocks , top 5 stocks maybe 60-70% allocation and a long tail. I do buy the same stocks over 2-3 yrs in multiple tranches. Hence posting about portfolio or its performance or trades too often will create more noise than useful info.
My investing style has changed from being over diversified to concentrated +diversified tail as of now. I do not know if it fits any style and luckily I don’t have to as its my own $$.
What I avoid is trading/FnO/Leverage and have learnt not to exit at peak pessimism but rather churn from lower conviction stocks to high conviction stocks.
I still do a lot of mistakes and am fine with them as long as they are small and not hurting much.
There is a video in instagram from the company that shows the factory somewhat. Its a stylish video(too stylish) ,but at the begining there is a fraction of a second of image of the factory from above .
There one can see a drone shot that shows the factory sheds…
Now in google maps , the address balloon is wrongly placed at the nearby village but the factory is visible half a km south east .Looks the same but the shot is old ..the temple etc in video is under construction .
Now , there is of course a possibility that the factory is somebody else’s but thats very difficult to verify without going there or contacting someone in that village ,
Regarding the questions, the first one is easily disposed as they were just setting up a new factory ..also, these rail factories are just sheds and heavy metalworking equipments ,so moving them is not as difficult as moving a car factory .I have been inside CLW and I have rough ideas of what is what .
I know that if you have contacts and some capital ,you can bid for small parts like cow catcher etc. just by having a guy who has worked there in the past , in your setup.
Regarding the RDSO certification, I have little idea ,but its all forging ,casting and metal working (cutting ,welding, painting etc.) ,nothing High tech or super high precision is being built there.If you have new equipments,you should be able to get certified .
However, the thing that concerns me somewhat is the opulence of the office interior .Too chic for the business they are in and at the stage they are in .
Disc: 2% of portfolio.
I Visited the Neetu Yoshi existing factory and new factory under construction in first week of Dec 26. I will put key points here-
I visited Neetu Yoshi factory at Haridwar on 01 Dec. It was a good steep learning curve about foundry business and promoters.
I couldn’t meet Himanshu Lohia but visit was Conducted by Mr YB Singh…The main guy behind production and quality check. He has 30 years of experience in this field.
In simple terms, they are buying scrap metal at 35 Rs per kg and selling it at 140 Rs per kg after converting it into desired products.
Every month 700 ton scrap is received at factory and 700 ton is converted into finished products. So approx 1400 ton material inventory is being maint at factory.
Neetu is name of Late mother of Himanshu.
While Himanshu and Subodh are young, they are being mentored and steered by their father who participates actively in business. He seems to be the big boss here and has good business acumen.
Family is Agarwal business family.
Factory was professional managed. Right from security guards , entry drills, safety drills for employees, quality check labs. They have installed a quality check machine for automotive parts also.
They can switch to various industries with same factory. They just need casting structures for those components which can be bought from Ludhiana.
There was lot of activity in factory. Current utilisation is 70 percent. Can be extended to 95%. Adjacent land can expand it further to 10%. There is no problem of space. Adequate farm land is available at 25 lac bigha rate.
Area is adjacent to Bhagwanpur industrial area.
As of now, 12 products are being produced at factory.
There is lot of orders due to expansion in Railways.
Future expansion-
New factory site work has started.
There is a reqmt of increasing labour count. New contracts being sought for the same.
Production in April seems unlikely. May June is most probable. Need to check about machines delivery also.
Few more points-
Almost all wagon manufacturer are located in Kolkata. Component producers who are competitors of Neetu are also located at Kolkata.
I asked that what is moat here. I was told that old players are lazy and are into lala type behaviour. They are not modernising and using latest technology for quality checks. That’s why NY is getting more orders.
Quality check process seems to be good and in order.
Production is being completely looked after by Production head Mr Y B Singh..very energetic person. Thirty years in industry. Package if 24 lac p.a
Subodh is learning under him.
My concern is their working capital.
They are maintaining one month of scrap that is Rs 2 cr approx, finished inventory of 8 Cr approx at factory..
Need to see how long, customers take to pay them.
Also they send the finished goods to Kolkata by road.
With second factory coming up, they will have to take some debt also.
They are looking for a third piece of land near railway line for 2030 goal of wagon manufacturing.
Their PAT is likely to reduce in FY 27 due to setting up of factory, machines, fresh inventory and addl labour ..
Electricity and labour is cheap here
Almost all b tech guys were young people from general area Dehradun..
So that’s a cost advantage they have I think
Insiders like production head is holding the shares of NY. Internally they are looking for target of 400..
Key man here is Father of Himanshu.. he seems to be a old businessman in this field.
Hi, I was going through the Annual Report for FY25 and stumbled upon a concerning observation in the CARO report (Annexure A).
The Auditor explicitly notes a discrepancy in the stock statements filed with banks versus the books of accounts. Specifically, for Raw Materials, the book value is ₹1.24 Cr, but the value reported to the bank is ₹3.89 Cr (nearly 3x higher).
Given that this was done to secure working capital limits, doesn’t this count as a serious governance lapse? If the bank acts on this adverse remark, how safe is the company’s liquidity position? Would love to hear you thoughts
Got an opportunity to speak with a popular PC parts supplier in Bangalore about Rashi Peripherals. The official company thread is closed, and I couldn’t find a better thread tracking microcaps, so I’m sharing my notes from the conversation here.
Rashi is one of the top suppliers of PC parts in India (GPUs, CPUs, motherboards, memory, and storage).
About 20% of his inventory is from Rashi. This is relatively low because he is not happy with their customer service. He believes they have grown too large to focus on customers and has experienced past incidents of poor service.
The remaining 80% of his inventory is sourced from WPG, Tech Data, Supertron Electronics, and other smaller players.
All of them supply largely similar products; he selects suppliers based on who offers better pricing and deal terms.
As a national distributor, Rashi has partnered with state level distributors for larger states such as Karnataka. At times, he buys directly from Rashi, and at other times from state level distributors.
Rashi’s distributor offers him trade credit of 30 days, after which he must make the payment regardless of whether the inventory has been sold.
He believes that in the short term, Rashi should be making significant profits, as prices of memory and storage have skyrocketed over the last 6-12 months, assuming they are holding large inventory levels.
Rashi primarily supplies ASUS and Colorful graphics cards. ASUS has lower sales than Colorful due to higher pricing. Zotac controls approximately 40% market share of graphics cards in India and is supplied by Supertron Electronics.
Rashi is one of the largest distributors of Lenovo and ASUS laptops.
My thoughts:
Rashi is the exclusive distributor for NVIDIA’s Founders Edition cards in India. This sounds good on paper, but in reality, most people do not buy Founders Edition cards due to limited availability. I have bought three graphics cards over the last 10 years and have never been able to buy an FE card because of long waiting lists resulting from limited inventory.
I have built multiple custom PCs for personal use and for friends but have never bought a Colorful graphics card due to its poor reputation in the market. I have mostly bought Zotac or MSI. Another popular brand in India is Gigabyte, and most people I know buy one of these.
@kdjolly I appreciate your analysis.I have a question regarding the valuation of the stock price and after such a bad time in the past why the stock has given such kind of extraordinary returns rising from 1 rupee to 200 rupees
