Had a look at #cleanscienceipo
My key takeaways:
1. Really specialty chemicals. Many cos operate under the guise of specialty but this one is the real deal. They did not file patents to protect their process IP.
2. Margins and unit economics top notch. Even china imports from this Co. Wow. Invested in backward integration recently to increase gross margins. Only depend on commodity chemicals as starting materials now.
3. While last 3 years profit CAGR was 42%, i don't think next 3 years will see repeat.
(i) topline growing at 14% in an industry growing at 8-11%.
(ii) some operating leverage and favorable product mix can take profit CAGR to 18-20% IMO.
(iii) I Won't pay PEG of 2.5 for any biz
Only airing my own thoughts. This is not a buy or sell reco. Do your own due diligence.
^You read that right. Co was worried that if they filed patents, someone would copy their processes and they wont be able to enforce patents. So they did not file patents :D Epic.

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More from @sahil_vi

10 Jul
Given the immense interest in this #investment #process thread about how to get investment ideas, thought of creating a logical follow-up 🧵

Given that I have an idea & some sense for valuation & growth, how do i construct a portfolio?

If you like the thread, plz RT.
First thing worth mentioning is that I am only describing my own process. Others can follow a different process which could work for them.

Opposite of a good idea can also be a good idea
Before understanding the process itself, it is important to understand the problems the process is being designed to solve for. What are the key hurdles or troubles I have faced in designing my PF.
Read 50 tweets
9 Jul
I am reminded of a wonderful fable I read few months ago in am investing book (forgot which one). It goes something like this:
5 friends are walking in a desert. They end up meeting god ny chance and God tells them that they will satisfy one wish for each of them.
Person 1 asks for a camel. They get it. They are very very happy.

Person 2 looks at person 1 like they are a fool. Person 2 thinks what a fool to have asked for such a small thing. Person 2 asks god for 10 camels and 10 kg of gold. They get it and are very very happy.
Read 8 tweets
7 Jul
Do you believe intelligent extraterrestrial life exists?
I am firmly in the yes camp.
Do we live inside a simulation or base reality?
Read 5 tweets
6 Jul
A lot of people ask: how do you find companies to invest in? very good question.

How did you find RACL, Pix?

Creating this ad-hoc thread to share my process.

if you like it, please RT to benefit maximum investors. 🙏
1. screener.in
Imagine what you want in a company, codify it in the form of filters, create a screen. Example below:
"Market Capitalization > 50

Market Capitalization < 3000

((Average return on capital employed 5Years > 25 AND
Price to Earning < 20) OR
(Average return on capital employed 5Years > 15 AND
Price to Earning < 10))
Sales growth 5Years > 10
Read 16 tweets
5 Jul
#Idfc first bank is something else entirely.
They reduced savings account rate to 4% around April 30 & yet the casa money continues to flow! Understandably some of it would have converted to TD (not given in current press release) but while several large banks casa has contracted
Idfc first casa has grown. Even average casa ratio has grown.

Look at hdfc bank casa as an example.
Disc: this is not a buy or sell reco, I am biased and invested
Read 4 tweets
2 Jul
Wonderful #racl geartech concall. I loved it. Key takeaways below:
1. RACL is EV ready
In b/w lines: EV require higher precision gears. Very few cos can make. Much higher gross margin.
Already doing tech investment in capex to be EV ready. Investment requirement in tech is much higher for EV gears. EV components will be 3-4% of topline in FY22.
2. Working with ZF on a BLW series 7 car for next year launch. Working on e-scooter or european company
In b/w lines:
1st marks RACL foray into premium luxury passenger vehicle transmission gears. 2nd is 1st time they designed entire drive train or kinematics.
Read 11 tweets

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