CCL is an interesting company; it is one of the companies that I have tracked for the longest periods of time (nearly 7 years now).
In 2017 when I first looked at it the stock had come off a very strong performance over last many years on the back of capacity expansion & increased utilization. Further it had a very good perception in the market as it was one of the largest holdings of Professor Sanjay Bakshi.
Jun 19, 2023 • 12 tweets • 3 min read
Weekly Insights #18- Music Labels: Uptrend to Resume 🧵
Music Labels-Tips & Saregama have been one of the biggest multibaggers in last 3-4 years. It is a trend driven by evolution of music industry that started from 2014-15 & was discovered & discounted by market in 2020 & 2021.
You can understand this evolution and read our research on the same in our old blog post from 2021 here- surgecapital.in/post/tips-indu…
Jun 16, 2023 • 14 tweets • 3 min read
Weekly Insights #17- RACL Geartech; Time to Monetize Debt 🧵
RACL Geartech is an auto-ancillary manufacturing precision gears and related parts for 2-Wheelers, 3-Wheelers, Agriculture Equipment and Recreational vehicles.
Company has a strong value-added manufacturing business on the back of low-volume & high-value products for high-end vehicles of customers like BMW, KTM, Kawasaki, Kubota etc and derives 70% of business from exports.
May 29, 2023 • 16 tweets • 4 min read
Weekly Insights #16- Indian Toners; From Deep Value to Growth 🧵
The strongest framework for multibagger returns is finding an opportunity that goes from being deep value to a growth play.
Reason this works is that deep value bets trade at extremely low multiple of single digit & are highly cash rich. Once growth is back, earnings expansion is non-linear given that there is a clear operating leverage due to increased scale & on top of it, you have major re-rating.
Apr 3, 2023 • 17 tweets • 5 min read
Weekly Insights #9- Reliance: The House of Optionalities 🧵
This post we revisit & extend on one of our old posts on Optionalities.
Would highly recommend you to read that before going ahead-surgecapital.in/post/investing…
In above post we had talked about how Optionalities can drive non-linear returns.
And one of the examples I had shared was that of Reliance & how the JIO’s optionality played out.
Mar 27, 2023 • 14 tweets • 4 min read
Weekly Insights #8- Biocon’s Market Cap = Syngene's. Value or Value Trap? 🧵
Recently I noticed something interesting, Biocon’s markecap is almost nearing Syngene’s marketcap; Biocon is trading at ~24,000 crores mcap and Syngene at ~23,000 crores mcap.
This is a very peculiar situation given that Syngene is a subsidiary of Biocon and only contributes a part of Biocon’s overall profits; and Biocon has other large businesses of Biologics and Generics-
Mar 13, 2023 • 16 tweets • 3 min read
Weekly Insights #6- Natco Pharma: Buyback Support & Where is the Upside? 🧵
1. Natco Pharma recently announced a buyback of Rs210 crores through open market route at a maximum price of Rs700.
This buyback is not surprising considering the past-history of Natco wherein the company has always leveraged capital markets to its benefit.
Jun 28, 2022 • 19 tweets • 4 min read
Putting some context on what I meant here-
By J-curve one would expect a non-linear growth, which will happen when you go from manufacturing say 10-50-100-500kg, over the course of Phase-I,II,III & then commercial.
However, in case of Syngene there are multiple pointers that indicate that this might not happen for the Mangalore facility-
One would expect that given a large CRO with multiple projects, Syngene would have a ready pipeline of projects to feed into its manufacturing business.
May 13, 2020 • 5 tweets • 2 min read
A better way to look at valuations is to ask whether the stock will re-rate, de-rate or stay the same in terms of valuations and what will be the factors for these to happen.
