H2 &FY20
NSE INVITE LINK: https://www1.nseindia.com/corporate/SINTERCOM_04072020103506_EarningCallInviteSintercom.pdf
RESULTS LINK: https://www.sintercom.co.in/images/pdf/financial-results-for-the-half-year-and-year-ended-31st-march-2020.pdf
The Sintercom discussion seems to have gone quiet for sometime. However, multiple positive developments for the company.
- Recently, they raised 222 million from MIBA. The latter now has 26% stake in Sintercom.
- Around 90 million of funds will be allocated towards new machinery. Capacity expansion.
- The company is developing sintered components for electric vehicles.
- The company has seen orders from non-automobile industries. Including oil and gas.
- Further industry diversification on the cards.
A lot of stocks have run-up in the last few months. In the mid-cap and small-cap space. Sintercom seems to be in a accumulation zone. Possibly a good time a consider exposure.
Disclosure: I am invested.
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I have been following and tracking this company for some time. Never invested as the company hasn’t delivered on sales growth as well as profitability. I am also intrigued that the stock price hasn’t fallen in these years. Does anyone have a view on why they will start growing and what’s the growth potential here? And why they haven’t grown till now?
No posts here since January 2022. Not much has happened for Sintercom in terms of top-line growth. However, for the last financial year, they reported healthy EBITDA margin expansion.
I was reading the annual report today and the management has set a target of achieving revenue of 50 million euros in the next five years. That would imply 450cr to 500cr revenue by 2028 from current levels of 87cr.
With ample opportunities within the auto industry and plans for diversification, the target seems achievable. If I read between the lines correctly, the target will be achieved sooner than expected.
Quoting Jignesh Raval - “We continue our journey to achieve the collosal goal of making the company a EUR 50 million revenue in a span of the next 5 years.”
Further - “While we say we have taken this as a target, we are confident that with various new technologies we offer to the industry we are not far of from the same.”
Disclosure: Invested
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Looks like new products are getting launched as per the company website.
https://sintercom.co.in/electric-vehicles/
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Thanks for sharing.
Yes, the stock trending higher is an indication of something that’s coming. As I mentioned earlier, the management has guided for revenue of 50 million euros in the next five years. The growth story is just unfolding, in my opinion.
A part of the growth acceleration is likely to be diversification towards new industries.
Not much discussion here. However, Sintercom stock has been moving well and now trades at 176. The company’s results have been ordinary with no year-on-year growth. Makes me wonder why the sharp move. Potentially, the stock is discounting better numbers ahead. Keeping my fingers crossed.
Disclosure: Invested
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https://nsearchives.nseindia.com/corporate/SINTERCOM_12052025205341_NSEUPLOAD.pdf
New 3-year Rs. 153.20 Cr contract with Tenneco USA for stainless steel sintered products
Another good news on MOU with Horizon Technologies. The supplies are likely to start by the end of the year.
If Tenneco contract starts on time, I believe that healthy revenue growth on a year on year basis is likely in Q3 and Q4.
While the stock has remained sideways, it seems that the much awaited top-line growth acceleration is round the corner.
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Seems like there is very little community discussion here. It’s understandable as Sintercom has disappointed on the growth front and the stock price mirrors the same. However, it does not imply that the Sintercom story does not hold promise. There are multiple developments that have the potential to trigger robust growth. The commencement of the supply contract with Tenneco in the current quarter is one factor. The production for Tenneco will be gradually scaled up over the next six months. The EVR-Horizon-Sintercom deal is another catalyst. It will start having an impact on results in the coming financial year.
However, the game-changer is likely to be entry into the consumer good segment. In the AGM, the management had talked about its BLDC Motor being under validation. Further query to the management indicates that it’s possible that the validation phase will be closed in the coming months.
For BLDC Motor, there are multiple points to note -
- Sintercom has developed the motor using soft magnetic composite and the company “claims” that the motor is superior to other BLDC motors in the market.
- The Indian ceiling fan market is valued at around 12,000cr and BLDC fans account for only 15% of the market. This implies huge potential for growth in a big addressable market.
- While traditional fans consume 70 to 75 watts, BLDC fans consume only 30 to 35 watts. This implies energy saving of nearly 60%. Considering this factor, it’s likely that the market for BLDC fans will get bigger in the coming years.
The potential is therefore significant and Sintercom is engaging with some of the top OEMs. Of course, it remains to be seen if the BLDC motors are accepted for serial production after validation.
Another point to note is that Sintercom has started with BLDC Motor for ceiling fans. However, BLDC motors have application across a wide range of consumer goods. As an example, air conditioners and washing machines to vacuum cleaners. It’s also worth noting that nearly 50% of India’s BLDC demand for air conditioner is being met through imports.
I “personally” believe that Sintercom will go beyond the ceiling fan market and manufacture BLDC motors for other applications. That might still be sometime away. However, if the company can crack a few clients in the BLDC fan segment, growth can significantly accelerate.
Disclaimer: I am invested and views can be biased.
Risk: Sintercom is a small-cap.
Risk: Sintercom has multiple contracts/plans. However, the execution remains to be seen. In the last few years, growth has been dismal.
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A small contract from Pinnacle Mobility Solutions Pvt Ltd. (EKA) for supply of Central Fork and Half ring for EV motor of 230 diameter used in commercial bus. Total value is INR3.18 million to be executed in April 2026.
However, this is important as Sintercom diversifies from passenger car segment to commercial bus. Further, if we read about EKA Mobility, they have secured some large contracts for electric bus in the last 3 to 6 months. I believe that the order book for commercial buses is 6,000 plus. This seems like a trial order and bigger orders might be in the cards in the coming quarters.
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