Thinking of averaging Marksans strongly and perhaps Time techno also.
Apologies for jumping in in your behalf @vikas_sinha
Globus is a beneficiary of two strong trends: consumer demand for branded IML, and ethanol policy which ensures 100% capacity utilisation for their bulk business as they can make ethanol or ENA depending on demand scenario. Besides, their bulk capacities are doubling in one year.
So they have downside protection from their bulk business which is in demand surplus territory of their consumer business is increasing in share. Unibev business will turn too at some point in time, further increasing margins. And it is still significantly cheaper than all alcohol companies.
Disclosure: Invested from sub 700 levels
Full portfolio here Vineet Jain portfolio
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UPDATE:
Sold off Time techno, switched to Optiemus infracom, also booked small parts of Dynemic, Valiant organics, Pix, Vipul organics and RACL in that order, transaction worth 2.8% of folio value
Reasoning: Optiemus is very speculative but it has demonstrated ability to profitably do mobile manufacturing for all kind of clients, just hoping they can stick to their PLI scheme commitments. Time techno has underperformed for a long time, do not see any triggers for growth spurt now.
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Whatās latest reason behind selling Time Techno?. 5 days before you were planning to add few more.
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Hi Madhu,
See it is the relative strength of shares, nothing wrong with Time techno. Also before I said preference is strongly for Marksans, since they are playing a very nice game in UK/europe and now starting up in US. It was quite weak for Time techno.
I doubt a company which leads a product line of ālarge size plastic drumsā, seemingly catering to chemicals etc. bulk packing. With 3k Cr turnover it seems they actually manufacture in more than a dozen countries. No doubt they were doing ok before corona and can come back strongly, thus I can be wrong also. Appears they are improving RoCE by consolidating manufacturing.
But their post corona recovery does not look very strong. Even as chemical entities are booming and also trade, their bulk packaging solutions have not shown traction.
The high-tech products, small but supposedly fast growing, such as urea tanks, nothing great, nor is their Mox films. Biggest user of gas cylinders such as India is moving on to piped gas like the developed world, so we have a enormous surplus of cylinders.
Metal LPG cylinders have a definite lifetime, they will likely only be replaced by composites when expiring. OMCs are not likely to be evaluating the dead-weight/transport efficiency and safety, it is about the short term costing.
I tried to get a type-4 cylinder for my CNG vehicle (to save 60 kg weight + added safety), the CNG kit vendor did not have one and insisted they are use and throw since the standards for cylinder safety check due after 3 years have not yet been issued by the agencies for the type (liar, very likely).
Apparently cheapest wins here too, the vendors even sell cheaper second hand kits and people are happy to run such vehicles without official papers. (vendors help with the sarkari paper-work but it costs 10% of the total kit price). CNG users are tight-fisted people in general, and the economics of CNG, 50% increased mileage with 50% cheaper fuel, is good enough to not invest more to save on dead-weight.
Even if they make sales equal to EKC, the cylinders giant, it will only make 30% of revenues. And they are not the only ones with such products.
All kinds of plastics companies have done well, pipes to packaging. This is a loser company, just a bit better than the biggest multi-national hi-tech pipe maker Jain irrigation, which is struggling to avoid bankruptcy, apologizing every concall for the erosion in value.
Cheers!
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Hi Vikas,
While Marksans trades at a lower multiple , bit has historically been a volatile company with margins varying widely. Somewhat cyclical in nature.
Any indication of change in times or are we in the updated cycle
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Sir would be pleased to hear from you about Marksans pharma and what good things they are doing in UK market. I am also studying about markans. Your input will certainly add value to the forum.
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Hi Shankar,
I like a company which fights back from the brink of bankruptcy to show strong growth, whereas most pharma targeting developed markets have struggled. This is āchange in timesā and not just updated cycle. It looks cheap, so good for safety and upside, nice to find this in a perpetual growth/safe sector like pharma with decent moats and where India shows relative strength.
Cheers!
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I do not do in-depth research, living off morsels of info collected from here and there, mostly from ValuePickr. Marksans seems to have a strong set of brands, mostly OTC, so a good presence in direct sell to consumer, thus good, stable margins/demand. I am just hoping they are able to show decent growth here and their plans for US/other markets work out. Hopefully their soft-gels expansion is a good idea and not false promise. API backward integration will take some time and improve biz prospects further.
I believe a biz should seem cheaply valued relative to future growth and this idea should be able to be communicated in few short lines.
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Hi Vikas,
You have made valid points. But, you did not talk about US operations and HDPE pipes. They will add value. I feel downside is restricted as it is trading below book value. I personally used composite LPG cylinder in Middle east. They have many advantages than steel cylinder.
However, l will wait for some more time and track the performance.
UPDATE:
Sold off Pokarna, switched to to Dish TV, seems like quartz exports from India are still in quite bad shape, shipping rates are at record high and will take year(s) to cool off, for stone products this is not good news.
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Recent rally has already has taken place in Dish tv. What promotes you sir to buy Dishtv when market is at all time high?
I think u are a momentum follower like me 
Hi vikas sir,
I am studying about vaibhav global can you help me out . The financials ,management and expanding in Germany everything is good ,why are u not investing in this stock. Major Reasonā¦
Hi Sai,
CCL seems like a decent compounder, I personally use their products, seen them selling in europe also but coffee can be terribly cyclical I hear.
Equitas holding is better from investment pov, seems like a decent franchise which has mastered the microlending sector, at least in the south, with scope for growth I hope should they diversify.
Cheers!
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Hi,
Dish is not a growing franchise but management change can show a transformation in financials I hope, the worst seems to be behind them. I used their services, is pretty good deal, prefer them over the competition. Downside is still low, probabilistically, as noted on their ValuePickr thread.
Cheers!
Hi Jaishish,
Momentum is a pretty ok strategy, really good for bull times, I am only a bad value-picker, late to the party actually, my mis-timed entries may seem like momentum but I really only try to get the value equation right. Conviction might be slow coming, hence the timing is not always good to get multi-bagger returns. When I think I see a better (higher/more probable) growth share than the ones already owned, I try to switch.
Cheers!
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Hi Sachith,
Vaibhav global is indeed in my long list of āmissed opportunitiesā, who knows I may find an entry some day! Yes, quality and growth both, looks like a pretty good one to hold on to.
Cheers!
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Hii
I request you to have look at Precision wire valuation and business model looks attractive.
Future EV revolution may effects valuations?
Marksans :- some anchor investor exited from the stock recently so there is fall.
How much does this factor looks considerable.
Thanks
Kuldeep
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