Latest credit rating update.
Invested and Biased.
Pretty pathetic results.
Here is the reason given by the management
Invested but may rethink after seeing these results.
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Poor results agreed. Now look at each line item separately and compare them with managementâs guidance last quarter.
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Topline - The 14% YoY growth is not pathetic, if not okayish. Q3 is generally weaker for them, so one shouldnât expect good QoQ performance either. If topline had been impacted, one could have argued that their sales were impacted because of competition or operational inefficiencies.
Mgmt had also said in their last call that they are transitioning and slower growth is âa result of deliberate choicesâ, not market share loss. Generally these things take 3-4 quarters for growth to kick in.
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Margins - For all importers, profitability has been impacted. Ethos is another company where margins were impacted (although not this much) because of foreign exchange fluctuation. Exporters are having a good time.
Mgmt had mentioned that margin compression in Q2 was driven by investments in new warehouse ramp-up, category expansion, technology upgrades, and strategic hiring.
So results are poor no doubt, markets will punish it as well. But are they pathetic? I donât think so. Once their omnichannel strategy kicks in by the acquisition of IDS Demned (which is still pending at NSE), we might see synergies with warehouse expansion, faster delivery, & physical touch point expansion for equipments sales.
Their FY27 target is 500-600 Cr, this can be achieved with this acquistion.
At the end of the day it all depends on the execution, every company promises and very few actually deliver it.
I am also betting on Malabar fundâs investment in the company. I am sure they know something that we donât know. Itâs more of a hope trade than my personal growth-led thesis currently. Itâs a bet on Indiaâs growing dispensable income and growing demand of healthcare services.
Disclosure - Invested & biased. Feedback and contra views are always welcome.
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Good points raised.
One of the big mistakes of this management was giving overly optimistic guidance in past. I agree they have realised their mistakes and are now giving reasonable guidance.
If you see, I was the one who started this post on Vasa in July 24. So I should be more biased towards it rather than anyone else. BUT, I avoid getting wedded to the stock.
Frankly, the sales growth is not upto the mark. And sales growth is deteriorating QoQ.
My basic strategy/process is - Keep a strict stop-loss of 20/25%. If it hits that, I am out.
Why this process - Because I had fallen prey to the sunk cost fallacy by averaging down the positions in the past. Itâs very tempting to average down when the stock is falling, but how sure are we, retail investors, about the business?
What if Malabar sells in the next quarter?
So, I will sell this if it reaches my stop-loss of 25%. Will have a fresh look again when it starts delivering.
A recent example being I bought Tinna rubber at 1000 bucks, but sold it when it touched 800. Now itâs around 700. But, hey, I have kept it on my watchlist and will surely add it once it starts delivering. Till that time, why have the emotional pain of looking at the 30% loss?
This is my process as per my mental biases. I may be wrong.
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Given that they are in a transition phase, I wonât look too much into the results. They have repeatedly said that delivery time is the one metric that needs to be shortened to make the switch for dentists to Dentalkart seamless.
From what I gather, Dentalkart is aggressively increasing their last mile network which should increase expenses in the short tern. I dont really care about the bottom line as I have a 5-10 year view with this stock so my main issue is revenue growth not being as strong enough. Maybe they have slowed their Sales and Marketing expense to allocate more funds towards increasing their last mile delivery.
I am not too worried as long as they are not losing money
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looks like some investor dumping this counter. huge spike in volumes
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JUST sharing the Investor Q & A posted by the management.
I personally dont like this âkind of framedâ Q & A. Why dont they do proper con-call and face the investors one on one?
Last concall was also framed. Please check for yourself. ( I am not able to paste it here due to some technical glitch)
Exited recently. Will decide about entry after the next quarterly results.
But, good thing is , Now Vasa is avaible at its lowest P/B and P/S valuations.
Promoters have reduced their stakes, and Malabar has increased.
Just trying to post my unbiased views. Both the Positives and Negatives.
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Any news in vasa denticity?
Other than resignation of gaurav agrawal?
He is related to promoters?
I donât think he is one of the main promoters.
Just sharing. Took small position in Vasa when it fell below 400.
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Company has given clarification that CFO wants to pursue entrepreneurship.
Although bigger worry is regarding IDS Denmed acquisition , In no way IDS denmed will want to have equity deal with dentalkart at previous price and without it dentalkart will be lacking a significant offline presence .
If somehow dentalkart acquires it , then lot of synergies will come and brand dentalkart will touch most Indian dentists.
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Thanks for sharing this. Now hopefully they get back to their growth trajectory.
And stop giving VERY optimistic growth guidance in the future.
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