Alpex Solar will be listing on bourses tomorrow.

The company has done fairly well & will be expanding its module mfg capacities from 450 MW to 1.2 GW & backward integrating by doing capex in Al-Frame.

🧵A Thread 🧵 The company has 17+ years of experience in solar PV mfg industry.

Current capacity is 450MW - most of the sales are derived from domestic markets.

Cupid : a company which has 5 years CAGR of

15% in Sales and 13% in Net Profit - in the same period, stock price CAGR has been at 17% too while RoE has been upwards of 20%.

The only overhang was - "Succession"

'Can the new promoter gain investors trust' is the question. The company has approx. 100 Cr in Cash & Liquid Investments while the market cap is 541 Cr and debt of 6 Cr ~ implying an EV of 450 Cr.

FY23 EBITDA was 41 Cr on which the company earned net profit of 32 Cr.

So is it worth entering Cupid at 11x EV/EBITDA and 17x P/E ?

Zim Lab Q1 Update :

Drop in export of nutra products impacted the numbers - most of this business will track back over the quarters.

Shifting of large PFI business orders to Q2.

Finished formulations exports business grew by 49% YoY.

Q2 should be better as per the comments.

20 NIP Dossiers filed + 19 upgraded dossiers of existing products.

6 Dossiers filed for OTF, 5 MA were received on dossiers.

5.3 Cr (8% of operating revenue) was spent on R&D.

Capex of 18.1 Cr during Q1 on new warehouse, manufacturing facilities etc.

Redtape Limited : (Q-1)

Sales : 394 Cr ; EBITDA : 81 Cr ; PAT : 47 Cr

Q2 is better than Q1 and Q3 is the best quarter for them.

Extrapolating Q-1 numbers (without considering growth), they can do 200 Cr of PAT and 330 Cr of EBITDA.

Trades at only 34x FY-24(e) PAT. Peer comparison :

Redtape is not comparable to any standalone footwear retailer as it gets more than 50% of revenues from Garments and accessories.

I don't think there is any listed peer to Redtape which has such a good brand recall.

SKP Bearing : another interesting microcap

Dividend of INR 1 per share

FY23 PAT 13.25 Cr on 48.76 Cr Sales ~ 27% Net Margin👌
FY23 EBITDA 19.33 Cr ~ 39.6% Operating Margins
Trading at 17x EV/EBITDA & 24.6x FY23 EPS

D - No reco. ; studying about it currently Balance Sheet :

Debt reduction : 19.3 Cr in FY22 to 4 Cr in FY23
Net-worth has increased from 18.6 Cr to 41.2 Cr
Fixed asset addition of 3 Cr during FY23 ; CWIP of 7.52 Cr

Zim Laboratories : (CMP - 91 ; Market Cap - 450 Cr)

A very under-researched but very impressive Small Cap Pharma Company

R&D spend : 26Cr (FY23) ; 84 Cr in last 4 years
PAT : 24 Cr (FY23) ; 49 Cr in last 4 years (cumulative)

🧵A Thread 🧵 Current business : 77% from Pharma & 23% from Nutraceuticals

NIP (New Innovative Products) : 2 products filed in the EU; 8 products under development for developed markets; 4 developed market filings planned in FY24

Boro Renew Q4 : (Standalone)

Gross margins expanded by 340 basis points - due to decline in key RM prices such as Soda Ash

EBITDA is flattish QoQ due to higher employee expenses (on account of SG3- new furnace), increased power & fuel costs Consolidated Numbers :

Improvement at gross & operating level (European unit was under cold repair during March)

Power & fuel costs decreased in german furnace (+ve sign) - expected in Indian furnaces as well from coming quarters

Borosil Limited : (Q4 & FY23 Results)

QoQ improvement in EBITDA & Margins - as guided by the management.

Higher depreciation on account of new opalware plant (production started on 1st Jan) dented the bottomline - PBT could have been 36 Cr without that. Annual Performance

First year when they've crossed 1000 Cr turnover mark

Due to volatile RM prices & increased power & fuel costs - EBITDA de-grew

FY24 should be blockbuster for them as the worst of RM price volatility is behind

Force Motors : (Thread) 🧵

CMP - 1289 INR ; Market Cap - 1701 Cr

Monthly sales numbers - improving MoM since Nov-22.

Q4 should be the best quarter of FY23 for Force.

March is the festival month so sales should increase MoM for them. With new product launches such as Urbania, Gurkha 5-door variant - these numbers should sustain and improve.

With 1 month to go - Force has already crossed FY22 sales by 17% and only 424 units short of Q4 FY22 sales number.

Case Study : (Rico Auto)

at 42-44 INR - the stock was trading below the book value (P/B < 1)

Management guidance was 25% growth in revenues and improvement in margins.

There was ample of value so was the margin of safety & growth triggers too. Auto sector was coming out of a very lean patch of growth due to various reasons :

- Slowdown in demand
- Higher commodity prices
- Chip shortage
- Supply chain disruptions

So revival in sectoral cycle was a 👍 to go ahead.

We were at Renewable Energy India Expo on Friday & Saturday.

Key Takeaways :

- Demand for solar panels remain robust with capacities being expanded aggressively

- Almost every panel manufacturer is running towards gigawatt scale and competition will be very intense. - Companies which are having plans for backward integration into cells and wafers will be the clear winners in few years from now.

- Capex requirement for per GW of : solar modules is 60-100cr while the same increases to 500-700cr for cells.

If your focus is on long term wealth creation then keep a close watch on decadal megatrends.

2 sectors which I like the most

- Retail (consumption will grow manifolds)
- Solar (panel + component manufacturing)

2nd one is my favorite as there is long runway for growth. In Retail - companies focusing on B2C and D2C with strong distribution reach and competitive moats should be preferred.

Borosil Limited (though a bit expensive) ticks all the boxes.

Laopala might perform better in short term due to additional capacities they have.

Thread on Borosil Renew FY-22 Annual Report 🧵

(1/n) Acquisition of Interfloat

The largest solar glass manufacturer in Europe.

Solar – 10 Predictions for 2022

1. 2022 will be the first year in which more than 200GW of solar will be installed.

2. Solar module prices will fall to 25 U.S. cents per Watts in 1H 2022, and 1-2 cents per Watt lower in 2H 2022.

(Source - Bloomberg NEF) 3. Installed utility-scale solar-and-storage will double.

4. China’s residential and commercial / industrial rooftop solar sector will drive the country’s new build to a record 81-92GW in 2022.

5. Residential solar and storage becomes default offering in more than two markets.

As there are many investors who keep on asking about Borosil Renewables ☀️

Let's revise my investment thesis 💹 in this company

What can be the near term headwinds 👎

Do share the thread if you find it worthy :)

So let's begin : 🧵

(1/n) Near term headwinds :

~ Soda Ash prices went up by as much as 200% from 2021 lows and are still up by 75% (Above long term average).

~ As their material cost is 25-30% of sales and approx 60-70% cost is of Soda Ash, There might be some margin compression in Q-3.

(2/n)

Key takeaways from the article :

~ Prices will fall back in the spring, but the gas market is structurally tighter than before the pandemic.

~ A bad winter will push gas and power prices – already near record levels – higher still.
woodmac.com/news/the-edge/… ~ Markets in key transition metals – copper, aluminium, nickel, lithium and cobalt – are also looking to the longer term, anticipating investment in decarbonisation with a global roll-out of low-carbon infrastructure.

~ We believe a metals supercycle is coming, just not yet.

Weekend Study - "Logistics Sector"

Do share some study materials in reply to this tweet :)

Let's learn and grow together 😊 Worth reading - How digitalisation can help logistics sector move forward in India
mckinsey.com/industries/tra…

Green Hydrogen - The New Oil ?! (Slides)

🧵A Thread 🧵 Hydrogen as a Fuel :

~ Hydrogen has a critical role to play in any aspiring path targeting carbon neutrality by 2050

~ Hydrogen is a potentially clean fuel that produces water when consumed in a fuel cell.

Short Thread on Valiant Organics 🧪🧑‍🔬

Super-Integrated value chain

All set to become a key player in Ammonolysis Chemistry !! • Valiant has a very diversified product profile and it is engaged into various processes/chemistries such as :

- Chlorination
- Ammonolysis
- Hydrogenation
- Methoxylation

• VOL has recently expanded their capacities to integrate their value chain across all processes.

How to select stocks in a falling market for long term investments :

A Thread 🧵⤵️

(i) Cyclical / Non-Cyclical Business
(ii) Efficiency parameters
(iii) Valuation Ratios
(iv) Management / CG

Do Like and Share to help us educate maximum investors.

(1/n) (i) Cyclical / Non-Cyclical Business :

• You will have to classify the business into either of these 2 categories.

• Cyclical companies follow the trends in the overall economy.

• They don't have pricing power and depends on external factors such as govt spending.

(2/n)

#Neuland (FY-21 Annual Report) :

- Focused on growing CMS business ; 4-5 late stage projects to get commercialised in next 12-24 Months.

- GDS business can grow with addition of specialised, high value APIs in Speciality segment. (Semaglutide) GDS Business :

- Plans to launch 18 new products in phases during this decade.

- 3 Peptides at various stages of development for GDS business.

- The specialty segment is expected to drive profits and prime segment is expected to strengthen the vertical in the coming future.