Dr Prashant Mishra Profile picture
Aug 17, 2020 21 tweets 4 min read Read on X
#quess Corp - my observations
• Market Cap: 5,432 Cr.
• Current Price: 370
• 52 weeks High / Low 639.05 / 165.00
• Book Value: 154.16
• Stock P/E: 44.14
• Dividend Yield: 0.00 %
• ROCE: 11.70 %
• ROE: 10.28 %
• SHP- Promotors holding 55.28( Constantly buying from market)
FIs 14%,DIs- around 16%,Rest with public
During market crash it went down from above 600 level to below 200
What It does –
It is engaged in offering end-to-end business solutions like general staffing, professional staffing, technology staffing, IT products and solutions, skill development, payroll, compliance management, integrated facility management and
industrial asset management services to corporate clients operating across sectors.
It is business services provider and largest private-sector employer.( fifth-largest manpower outsourcing company globally)with 3 operating segments.
1-Work force management

2-operating Asset management
3-Global technology solution across this ndustries
Quess has a team of over 334,000 employees with presence in India, North America, South East Asia and the Middle East across segments ,.
Quess serves over 2,000 clients worldwide.
Headcount 1364 in 2008 to 3.34 lac in 2020 ( See the growth )
Workforce Management
Operating Asset Management,
Global Technology Solutions across industries
Some Interesting Subsidiaries
Quess is having many subsidiaries but some subsidiaries you must be familiar also

1-Digicare ( Amazon invested 51 cr in it) After-sales services provider for handheld products like Mobile handsets, Tablets, Cameras and consumer electronics &
consumer durables products including Air conditioners, Washing machines,

Refrigerators, LED/LCD TVs etcetera.( Visit website of Digicare)
2- Monster ( job recruitment website )
3-Dependo - Doorstep courier packaging and delivery services ( see its website)
Debt position
In 2015 is debt was 224 cr and after that acquisition of many businesses and expansion debt was around 1147 cr in March 2020, (In FY 20 -Gross Debt increased by ₹ ~363cr to ₹ 1,147cr primarily due to ₹ ~410cr acquisitions done during the year
and a ₹ 100 cr increased precautionary working capital line drawn down in March 2020 due to COVID.)
.But in Q1 Gross debt reduced to ₹ 977cr from ₹ 1,147cr by ₹ 170cr,and company is working both directly and indirectly to reduce the debt.
Indirect measures to reduce debt-
Giving away the rental facility , Also the senior management employees will be living
in budget quarters, more and more paperwork is getting automated and digitalised
to save costs ,
For this whole year company will have something like Rs 60-70 crore
permanent reduction in indirect costs.
What i don’t like in the company-
Declining ROCE ( I am not good in financial but i think it is due to aggrasive acquisitions)
High competitive industry along with high attrition rates limit scope for margin expansion also .( already very thin margins)
-The company is also exposed to government receivables on account of its presence in the training and smart city project
(receivable of around 100 crore from the Smart City Ahmedabad Development Limited)

quess witnesses peak utilization of 85% of the company’s working capital limits regularly and it enters into tri-partite agreements with clients under which the associates remain on
QCL’s payrolls only as long as the services are availed by the client. However, payouts to its associates in the event of deferral/non-realization of collections from its clients could result in further stretch of the company’s working capital.
Now why i am optimistic on quess Corp
1-optimism’ on the hiring demand for the rest of the year as major cities such as New Delhi and Mumbai gradually open up with a decline in Covid-19 daily infections and clients prepare for the festive season ahead.
2- Government initiative of make in India to attract more manufacturing units and staff requirement ( Contract work force)
3-Apart from its rest of the businesses i am more optimistic about digicare( its like outsourced sales and service) and dependo.
If company reduces the debt further and no acquisition for next few years and less dependency on government projects then it may be very good for company, although it will remain a low margin business only .

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More from @drprashantmish6

Sep 5, 2023
Study this company -
Valiant Communications Ltd( Some Good Points from recent business updates)Although i consider Valiant name as a high risk investment idea because of my old experience with valiant organics , some similarities between valiant organics and valiant communications are
low promotors holding
Recently promotor sold some shares.
( Disclosure - Its not my original idea )
✍️Valiant has become the 1st Indian company whose make “Phasor Measurement Unit (PMU)” has been re-type test approved with latest technical specifications by the Council Of Scientific And Industrial Research–National Physical Laboratory (CSIR–NPL) Based on this approval, the Company has applied for Proof of Concept (PoC) to the Power Grid Corporation of India Limited. It is important to mention that PMU is a key component of “One Nation, One Grid, One Frequency” concept and smart-grid projects. PMU plays a key role in Grid Automation, Grid Stabilization and Load Management of the Power Grid. Globally, there are very few foreign manufacturers, manufacturing PMUs at present. The PMU opportunity is also of global nature. Being an indigenous manufacturer, Valiant is apparently a beneficiary of all business opportunities that are notably arising in the Indian Public Sector out of the ‘Make in India.
✍️Valiant has successfully partnered in the Indian market with Tejas Networks Limited. Both the Companies are determined to replicate their business synergies at the global level also. In a recently concluded tender at Bhutan Power, Tejas (with Valiant’s partnership) has been declared lowest bidder (L1), for which the final PO is awaited. Valiant has also partnered with Tejas and another Tata’ flagship company, for power utility markets in Australasia for multi-years contracts. Given the global reach of the Tata Group, the management is optimistic about the outcome about such opportunities.
✍️Valiant and Tejas have now partnered for the forthcoming large-scale business opportunities for their products supplies at the State Electricity Boards (SEBs) of Kerela, Tamil Nadu, Telangana and Gujarat. These business opportunities are valued at over ` 100+ crores for Valiant
✍️The management expects to improve its operating profit margins in forthcoming quarters in the light of
: • Expected better product-mix;
• Earlier years supplies are entering in AMC phase now, resulting a top-up revenue for services;
• New cutting-edge technology driven products are being offered.
✍️Target IndustriesImage
Cyber Security business: The Company is expected to receive its maiden government contract in the current
quarter. Our Company has already successfully conducted a Proof of Concept (PoC) trials with India's premier Grid
Operator for a few of its Cyber Security products and these successful trials for early detection and warning systems
of cyber-attacks, ransomware attacks and network intrusion to safeguard their Gird communication systems, will
start to generate business revenue in the coming quarters. This opportunity is of very large scale, both domestically
and internationally, due to the unique cyber-security solutions that our Company offers.
The Government has a heightened focus on Cyber Security for all its departments and with a view of protecting
critical infrastructure and its data. This should translate into induction of our Cyber Security products in the
Government Sector under the ‘Make in India’ and the ‘Atmanirbhar Bharat’, path-breaking initiatives taken by the
Government of India.
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Jun 22, 2023
Synergy Green -Why i like this company ( No recommendation )
1- Policy change in wind energy sector. Read this

2- Bullish wind energy sector ,read this

3-capacity addition-

5- Raw Material Prices are now stabilized , so i feel with increase in capacity and stable raw material price now margins should be better. Image
Read Investor PPT from Inox wind- Favorable macro environment for wind Sector. Image
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Jun 9, 2023
Ami Organics Concall ( Only imp points)
✍️ our business model is designed in such a way that the revival of the Chinese chemical industry has a minimum to no bearing on us.
✍️On the demand side, we were witnessing gradual upswing in the demand in H2 FY '23. And I believe the revival will continue in H1 FY '24
✍️Electrolyte additives- we have received approval from 6 customers worldwide. We have also received plant-scale trial commercial orders of few metric tons. And we are also expecting a bigger commercial order during the current quarter.
we have developed 2 more products in this segment. One of them is liquid electrolyte additive to increase electrocapacity of the Lithium-Ion batteries and one more additive for solid-state battery
✍️we have been able to expand the scope of our contract with Fermion, and we have added a couple of high value intermediates for the same. This means we will now be doing 3 advanced intermediates for them which increases the value of our contract manyfold.
✍️Fermion contract-( darolutamide, Nubeqa )that is a long-term contract, and it will start supplying from Q3 of FY '24. The full capacity supply will be starting FY '25. Because it is a pharma business, and it takes some time for registrations in 180 countries worldwide. So, in Q3 and Q4, it will be giving us a sizable revenue. But from FY '25, it will be giving us a full revenue, And in that contract only, we have 3 more products, and all 3 products are additional to the contract. So that will also help us to grow more in terms of numbers in the upcoming years.
✍️This product is growing unexpectedly to 200 or 300x a year. Whatever they expected in 2026, they already closed in 2023. So, it's going very fast. And the basic API manufacturing plant in Fermion is fully utilized and the intermediate which they are trying to source from us, they are currently making it in-house. They don't have any source other than us.
✍️ Baba Fine Chemicals acquisition - we are gaining entry into a very high entry barrier semiconductor industry and its products main application in photo resistance chemical in semiconductor industries and they are making very high purity chemicals, And going forward the market is more than $2 million in photo resistance chemicals,It will definitely grow more than 3x to 4x in a year,Baba Fine Chem is currently manufacturing and delivering, is exclusively for one customer. But there are more than 40 products, which are already developed and the samples of which can go to the world. Apart from U.S., other countries like Japan, Korea, etc, we have started promoting this product in those countries also.
✍️Export for the year was at 59%, whereas domestic business was at 41%.
✍️ balance sheet, we have a net debt-free balance sheet with cash and cash equivalent of around INR59 crores
✍️We are targeting this year, that the specialty chemicals segment will grow around 25% to 30% against our normal growth of 22% to 25% of our pharma segment, developed some molecule in sp chemicals with versatile applications, including electronic donor, polymer industry as well as some paint industry additive, UV Absorber, as well as some electronic industry. So, cumulatively once it is all in, it will bring a lot of large volume and large value.
✍️Capex INR200 crores plus next year.

✍️Anticoagulant Basket-Apixaban and rivaroxaban is a growth driver for us for the next 2 years because it's going to be launched. And our generic player worldwide more than 26 customers in apixaban. They are all ready to launch. And also, they won some litigation in U.K. against the originators, so that will help us to start moving very fast. In rivaroxaban, the originator has qualified us, and they started placing order in Q4 FY '23. So now we are supplying to originator as well the rivaroxaban. So, it's a very good growth driver for us in the anticoagulant segment.For Edoxaban three customers in Japan qualified Us.
✍️Ankleshwar facility is upcoming facility which will be ready by December '24 operationally. So that will come with a very huge volume, 4x volume than our unit 1 in Surat. So that will be definitely help us with our FY '24, FY '25 & FY '26 growth of pharma.( Asset turnover Normally 3 but we have high value products.)
✍️Currently, on an average basis, considering sales as a base, our working capital cycle is 108 days. And I try to bring this at 100 days. So, we are continuously working on it
✍️The advantage for Ami Organics or, say, for Indian manufacturer, is that the U.S. and other European countries have stopped buying any battery cells or anything which is generated from China. So that is an added advantage that any manufacturer based outside of China will need to have a raw material from outside China. So that is helping us to push ourselves in a faster mode of getting the orders and all.
✍️Normally, our product basket is well distributed and none of the basket is more than 15%
Ami organics
Ami organics - Image
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John Cockerill- Decarbonisation of steel Image
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