Educational Videos : Brexit overview

Hi All - As per the request over last few months to post educational content on my website too along with Stocks and IPO reviews, I have decided that I would keep posting videos on the latest topics in the market along with basic finance topics for people who are new to financing market from time to time. Hope you do like the videos

Thanks
Smallcapvaluefind

IPO Review: Axita Cotton

Hi All - Upon multiple requests till now to reviews upcoming IPO, i have added this feature in my sites so that can do fundamental review of the company.

AXITA COTTON : AVOID

Links:

Prospectus
website

Stock analysis: GNA Axels

Hi Friends - Market has started to recover from it recent lows and last week have seen quite a lot of stock recovering by 15-20% from its lows levels.

My next stock which i am analysing today is GNA Axles.

Current Price as of 18-12-2018	357.6
Market Capitalization (Cr)	767.49

About the company:
GNA Axles Limited (GAL) is a Jalandhar based company, incorporated in the year 1993. GAL is the flagship company of the GNA group, set-up in the year 1946 for manufacturing of auto components for commercial vehicles, tractors and offhighway equipment. The company is engaged in the business of manufacturing and supplying axle shafts and spindles (ranging from 2 kg to 150 kg) to OEMs and Tier-1 suppliers. GAL has its manufacturing facilities located in Hoshiarpur, Punjab with an installed capacity of ~4 million pieces per annum, as on March 31, 2018.


Products

(i) Rear axle shaft
Rear axle shaft is the primary product of the Company which contributes to 82.73 % of its revenues and 77.22% of components manufactured in FY18. The Company has a large variety of axle shaft s ranging from 1.5 kg to 65 kg and with a capacity to manufacture up to 165 kg. Our long-standing global presence is owed to the experience in development and manufacture of this product.

(ii) Spindles
Spindles GNA manufactures spindles for on-highway vehicular segments. Spindle is a part of axle housing assembly of an automobile. Spindles contributed to approximately 12.01% of its FY18 sales and 12.58% of components manufactured in FY18.







(iii) Other shaft:  GNA manufactures other shaft s including drive shaft, power take-off shaft s, hydraulic lift shaft s and transmission shaft s. These shaft s are a part of transmission assembly of an automobile. Other shaft s contribute 5.26 % of its FY18 revenues and 10.20% of FY18 components manufactured.

Customer base:
GNA’s customers have been an integral part of the 25 years of success story. The Company works in tandem with the customer’s requirements across the automobile segment and delivers solutions as per their needs. Today 100% of the customers have been with the Company for over 15 years. The Company’s customers include global OEMs and tier-I suppliers such as Dana Limited (USA, Mexico and Brazil), John Deere (Brazil), Kubota Corporation (Japan) and Meritor HVS AB (Sweden, Italy, Brazil, USA, China and Australia), as well as leading Indian OEMs and tier-I suppliers such as TAFE, International Tractors Ltd, Escorts Limited, Axles India Ltd, Automotive Axles Limited and Mahindra & Mahindra Ltd.

Growth Drivers:

One of the major factors driving the growth of the rear axle market is increasing global automotive production. Further, the increasing need for high capacity lift ing applications is fuelling demand for the rear axle market. Moreover, logistics operations of heavy weight equipment such as electrical machines and new vehicles is expected to increase the adoption of rear axles in the near future. OEMs forming strategic alliances with manufacturing equipment providers to cope with the demand from vehicle manufacturers is a major trend identifiEDd in the global automotive rear axle market.

During the year they successfully installed new capacities and also debott lenecked our production facilities. 

The effect of this has been seen in their sales and revenue and should only improve and consolidate their position with time to come.

For the year 2018-2019 they are focusing on the following parameters to achieve our targets:

1) Increasing our capacities to meet the enhanced demand  to increase their market share in both Domestic and Export Markets.
2) To Strengthen their operational efficiencies.
3) To penetrate into newer markets and new customers. they are looking to further strengthen their relationship with our Customers both in the Tractor segment and Commercial Vehicle Segment in India and overseas and are also working to establish their foot print in the new segment i.e SUV Axle Shaft .



As they are operating in the Auto Component Industry, their performance is dependent on the fortunes of the auto Industry. Indian Automobile sector is on a growth path and is poised to grow on the back of growing Incomes in the rural areas and the growth impetus given by the Government to the Rural Economy. The Commercial Vehicle segment is also poised to perform well due to increased infrastructure and economic activity in the country. The commercial vehicle industry in North America and Europe is faring well and the growth of the same is also expected to continue in the future years also.

Risk:

(i)  Any downtrend in the abovesaid sectors can hamper the growth momentum of the Company. To mitigate this risk, the Company has decided to venture into a new segment of SUV Axle Shaft. The Construction of the factory shed is complete for the said Unit and the machineries have started arriving and the management expects to start the commercial production from the said unit in the fiscal 2019-20.

(ii) GNA has certain key customers which are core for its business and its growth and while the business with key customers has increased, the Company, as in the past, has been trying to mitigate the risk of its dependence on certain customers by making its customer base broad and also diversifying its product portfolio.


Financial performance:

- The Company posted a net operating revenue growth of 30.53% this year up from 51340.96 lacs in FY2016-17 to 67013.52 lacs in FY2017-18.
- The Company posted an EBITDA growth of 27.08% this year up from 8334.78 lacs in FY2016-17 to 10591.96 lacs in FY2017-18.
- The Company reported a PAT growth of 71.92% this year, up from 2959.73 lacs in FY2016-17 to 5088.43 lacs in FY2017-18.
- With the overall support and good performance by team GNA the production and the sales volumes touched new peaks couples with the improvement in all spheres. The operating revenues grew by 30.53 % touching 67013.52 Lacs and the net profi t jumped 71.92 % to cross the 5000.00 lacs milestone. The production volumes increased on the back of increased demand for all the product segments of the Company both globally and domestically.
- Their Export volumes growth was on the led by robust demand of the Commercial Vehicles in Europe and North America which are our key export markets. As India sold a record number of tractors touching 7,11,000 units in the year 2017-2018 helped the Company to grow its sales domestically as well.

Profit & Loss
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Sales	430.07	508.52	513.41	670.14
Operating Expense	369.67	426.17	432.96	567.09
Raw Material Cost	293.4	330.34	322.75	458.16
Change in Inventory	14.89	12.83	4.21	33.14
Power and Fuel	30.01	36.96	40.64	47.82
Other Mfr. Exp	19.29	18.05	19.14	21.49
Employee Cost	18.47	23.72	27.12	31.85
Selling and admin	23.16	29.41	26.78	39
Other Expenses	0.23	0.52	0.74	1.91
Operating Profit	60.4	82.35	80.45	103.05
Operating Margin (%)	14.0%	16.2%	15.7%	15.4%
Other Income	0.57	0.42	2.9	2.87
Depreciation	22.98	27.17	23.94	24.8
Interest	17.26	16.29	12.52	7.09
Profit before tax	20.74	39.31	46.89	74.03
Net profit	21.6	25.96	29.6	50.88
Quarters
Report Date	Dec-17	Mar-18	Jun-18	Sep-18
Sales	167	204.52	212.58	227.25
Expenses	140.14	175.01	180.96	191.37
Operating Profit	26.86	29.51	31.62	35.88
Operating Margin (%)	16.1%	14.4%	14.9%	15.8%
Other Income	0.42	0.67	0.13	0
Depreciation	6.2	6.26	7.94	8.62
Interest	1.34	1.85	2.3	1.8
Profit before tax	19.74	22.07	21.51	25.46
Net profit	12.68	16.45	14	16.24
BALANCE SHEET
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Equity Share Capital	15.17	15.17	21.47	21.47
Reserves	97.64	123.14	275.44	319.96
Borrowings	153.22	138.63	117.29	142.32
Other Liabilities	160.43	169.59	163.04	198.54
Total	426.46	446.53	577.24	682.29
Net Block	159.33	147.31	131.74	190.69
Capital Work in Progress	0.42	0.05	2.53	0
Investments	0	0.01	0.01	0.01
Other Assets	266.71	299.16	442.96	491.59
Receivables	121.85	162.08	182.27	235.47
Inventory	91.94	91.37	110.29	153.64
Cash & Bank	0.42	0.67	72.45	26.09
others	52.5	45.04	77.95	76.39
Total	426.46	446.53	577.24	682.29
CASH FLOW:
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Cash from Operating Activity	27.01	74.47	-90.3	59.71
Cash from Investing Activity	-14.46	-16.38	-7.96	-78.36
Cash from Financing Activity	-12.65	-58.36	97.97	18.71

Please note that this is a educational website . I am not a SEBI registered analyst and my views might be biased. I have not got any consideration from the company to write this report not do i have any holding/interest in the company in last 30days.

Stock Update: Beta Drug

Hi Friends

Just some update on the beta drugs:

(1) After recommendation, the stock price has shot up almost 50%. I have got several queries if the stock is still good to buy.

Since I am not a SEBI registered research analyst, I can't suggest buying/selling. Company for the H1 2018 has posted outstanding result with a Net profit of 3.4Cr vs last year H1 17 of  0.4Cr..EPS of H1 18 is ~4 while the company has already issued guidance that it expects its full-year profit to be ~8cr which would imply EPS of ~9.

Given the stock price ~90, it's clear that the stock is still very cheap esp with P/E of 10 based upon FY18 earnings. In Industry where average P/E of pharma is ~20-30, there is still room for 100% upside on this at least from the current level if everything goes as planned by the company

(2) The company mentioned that there is further upside to 8cr if its able to complete the Adley formulations. Few weeks after results were published, the company announced that it has completed the acquisition. This will add further uptick to the revenue.

Regards
Microcapblaster

Stock Analysis: Beta Drugs

Beta Drug : Its s NSE SME stock trading at 62.

Market is going through severe correction specially in the small cap and mid cap space. In my view these are great times to build a great portfolio for the next level of bull runs

1) Because of the recent selloff the company share price has corrected >60% from its all time high of 200 to nearly Rs 60 currently thus trading at P/E of 8 which is extremely cheap considering the average industry P/E of 25 in Pharma sector.

2) Beta has a portfolio mix of more than 50 different medicines. The company’s medicines are available in 70% of the corporate hospitals in India such as Apollo, Max, Lillavatti, Nannavatti, HCG, Fortis etc. It also has exclusive tieups with Kerala Govt’s/Adhyar Cancer Institutes of being an exclusive supplier of cancer medicines through different govt yojnas/schemes. Beta is also a supplier for Gujarat Cancer Research Ahmedabad.

3) Indian pharmaceuticals industry is globally respected and is one of the most successful industries in India. It has contributed immensely to Indian‘s healthcare outcomes and economy. In addition to helping ensure affordable and accessible medicines in the far reaches of India, it also generates employment, directly or indirectly hiring around 2.5 million people. Affordability and accessibility of India pharma products has improved in domestic as well as international markets. The industry‘s strong initiatives to drive access and awareness across all regions of the country have resulted in around 50 per cent higher drug penetration in rural India. India continues to be the primary supplier of essential medications for numerous disease areas worldwide, helping save millions of lives every year

4) Indian pharmaceuticals industry is well respected worldwide and is one of the most successful industries in India contributing greatly to country’s healthcare outcomes and GDP. Top notch capabilities and advantageous market conditions over the last many years have ensured that India continues to be one of the most profitable pharma markets across the world. It remains an attractive destination for generic R&D and manufacturing of pharmaceuticals owing to its strong capabilities across the value chain. Oncology drugs market is expected to grow at a fast clip across the world primarily driven by an ageing population and lifestyle changes making population susceptible to cancer. In India the Oncology drugs market is expected market to grow in double digits for the next many years to come. Therefore, Beta Drugs being a leader in the oncology segment has long runaway ahead both in terms of opportunities and growth.

ROAD AHEAD
 • Expanding presence in international markets; to open at least 10 non-regulated markets this year 
• To increase market share of our own branded drugs
• Inorganic growth opportunities
• Research & development led growth; launch niche molecules by 2019-20 
• Focus on cost rationalization and efficiency initiatives
• To obtain registration of European Union GMP by end of FY 18-19
• To commission new block by October, 2018 and upgrade all machinery to 21-CFR for a better compliance at international level

Products of company

5) Financial overview:

Beta’s net sales grew by 21.40% to Rs 50.56 crores compared with the same period a year ago. This was primarily driven by company increasing its market share in the domestic oncology segment. Beta added some marquee names to its clients list and expanded its presence across corporate hospitals in India. The company’s medicines are available in 70% of the corporate hospitals in India such as Apollo, Max, Lillavatti, Nannavatti, HCG, Fortis etc. Net profit too surged by 58% to Rs 6.76 crores. This increase in net profits was due to the fact that the company was able to reduce its operating expenses. This also reflected in margins expanding across the board. Net margins increased by 314 basis points compared with the same period a year ago.

Profit & Loss
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Sales	0.26	26.38	41.65	50.57
Operating Expense	0.26	23.36	34.36	41.12
Raw Material Cost	0.26	15.33	23.32	28.61
Change in Inventory	0.11	0.2	-0.46	0.41
Power and Fuel	0	0	0.75	0.89
Other Mfr. Exp	0	0	0.67	0.97
Employee Cost	0.09	3.17	3.87	5.08
Selling and admin	0	0	4.47	4.84
Other Expenses	0.02	5.06	0.82	1.14
Operating Profit	0	3.02	7.29	9.45
Operating Margin (%)	0.0%	11.4%	17.5%	18.7%
Other Income	0	0.02	0.03	0.24
Depreciation	0.1	1.24	1.24	1.85
Interest	0.02	0.66	0.82	1.01
Profit before tax	-0.12	1.13	5.25	6.84
Net profit	-0.11	1.13	4.27	6.76

BALANCE SHEET
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Equity Share Capital	1.01	1.01	1.01	8.65
Reserves	0.06	1.19	5.06	24.23
Borrowings	4.77	8.34	8.21	7.67
Other Liabilities	2.17	4.66	8.93	9.03
Total	8.01	15.2	23.21	49.58
Net Block	0.55	7.34	8.11	13.19
Capital Work in Progress	5.71	0	0	1.35
Investments	0	0	0	0
Other Assets	1.75	7.86	15.1	35.04
Receivables	0.08	4.4	10.51	14.44
Inventory	1.28	2.86	2.4	2.8
Cash & Bank	0.06	0.13	0.14	11.91
others	0.33	0.47	2.05	5.89
Total	8.01	15.2	23.21	49.58
CASH FLOW:
Report Date	Mar-15	Mar-16	Mar-17	Mar-18
Cash from Operating Activity	1.39	-0.37	4.74	17.1
Cash from Investing Activity	-5.71	-2.3	-2	-10.79
Cash from Financing Activity	4.37	2.75	-2.72	5.45

6) Company has wide range of products and as mentioned earlier due to lifestyle change the demand is expected to be robust thus expecting company to continue to grow at 30-40% P.a. P/E based upon expected forward earning for FY20 at current market price of 62 is around 4.5 which is cheap esp considering this sector

Please note that i am not a SEBI registered analyst. This is for educational purpose and my views might be biased given i have holding in this company.

General: No Paid services

Hi All

I have got multiple emails till now that if I do provide paid investment service. I DON'T and don't have any intention to provide in near future. I love to analyze companies and file potential multi-baggers. My investment philosophy over the years has helped me to pick up stocks which are not yet recognized by market however given most of the stocks are micro-cap, it carries the risk that with time the story may not turn out to be the way we want. This blog is more to channel my passion into something which can help microcap investors based upon which they can take their own judgment. Its a purely educational website and beside that I am NOT ALLOWED to give paid research as you have to be a SEBI registered analyst and I feel my objective here is educational rather than making money.

I would encourage all of you in fact to read my analysis and post me questions which we both can discuss.

Many thanks
Microcap

Stock Analysis: Vedanta Ltd

Hi All - My today's analysis is rather on a large-cap company instead of a small cap. Its none other than Vedanta.

Vedanta
- Market Cap 80K Cr
- Current price - 214.3
- 52 Wk H/L : 355/197


About the company- Owned majorly by Vedanta Resources, a metal, mining, power, and oil-and-gas company- Vedanta Resources holds 50.1% stake in Vedanta- The group's copper, iron ore, aluminium assets at Jharsuguda and Lanjigarh in Odisha and power divisions (2400-MW and 1215-MW captive power plants for the aluminium business), are in Vedanta. The group also has aluminium operations through Balco.- The copper business comprises mining and smelting operations in Zambia.

Key Financial Indicators: ParticulaRs. Unit 2018 2017 Revenue Rs. Cr. 92,975  73,091 Profit After Tax Rs. Cr. 13,692 11,316 PAT Margins % 14.7 15.5 Adjusted Debt/Adjusted Net worth Times 1.3 1.7 Interest coverage Times 5.7 4.4

Key features which actually makes this company extremely attractive at this share price

(i) Promoter holding is > 50% ... its 50.14% as per the latest shareholding statement
(ii) Current price of 214 is almost a 40 % correction to its 52 week high of 355 . The company fundamentals have only improved post its acquisition of Electro steel (90% stake ) while continuous growth in the profitability. It's just a matter of time before it goes back to its previous levels.
(iii) The complete portion of the company holding is unpledged.
(iv) Price to earning is just 6.55 which is almost 1/2 of its closest peer of Hind Zinc of 13 which again is pretty cheap on how the company has been performing.
(v) The company has a dividend yield of ~10% which is extremely good in current market conditions.
(VI) The company has good consistent profit growth of >25% over last 5yrs and its expected to keep growing at CARG of 25% for next 2-3yrs at least more.

With all the above features and good growth aspects in mind - do you think the above price justify an investment in this company? i think the answer is Yes.

Note: I am not a SEBI registered research analyst. I have an investment in this company around the current market price so my views might be biased.

Stock Analysis: Companies which are betting on massive investment

Hi All

Today I will talk about three companies all of which are betting on a massive investment. These stocks have a long gestation period, however, I am very confident 2 out of these will surely be able to product 2-3x return.

All of these company have four things in common

(i) Capacity expansion almost 2-3x of its current capacity
(ii) Massive capital expenditure for future expansion almost 2-3X of its Market cap
(iii) No fancy historical statement so the historical analysis is irrelevant for these companies as these are potential small cap companies from its current phase of Microcap
(i) due to small-cap and mid-cap crash, the company share price has dropped to almost 52 week low which makes it extremely attractive given above three fawith

witho above three themes in mind lets examind the three companies

Stock 1: Shri Keshav Cement & Infra Ltd (CMP: 81)

Market Cap: 41Cr
If you look at the past performance of this company then you won't find anything fancy to be honest. Profit has been all time low.

Lets now focus on the recent cash flow of the company . we can see that company has made massive investment in the plant and machinery which is almost 2 times its market cap of 40cr.

The company did disclose in its annual report that company it has set-up 20 MW Solar plant at Bisarahalli Village in Koppal, Karnataka. The project was financed by Bank and successfully commissioned in March 2018. Due to Karnataka State policy to promote Solar investment, company is exempted from Wheeling & Banking charges and cross subsidy charges for Ten years. Currently Wheeling & Banking charges are 7% and Cross subsidy charges are INR 1.52 per unit. The power cost is expected go down significantly and expect new revenues from selling excess power generated.

Just few days after that company also did the below BSE announcement:

With respect to the above stated subject, Karnataka State Government permitted M/s. Shri Keshav Cements and Infra Limited to sell the excess solar energy produced in open market.20 MW solar unit was commissioned in March 2018.

link :https://www.bseindia.com/xml-data/corpfiling/AttachHis/0a85df3d-878f-483f-a3c7-e193fa201bd3.pdf

Given this mega update, i do expect company to show much better financials going forward.

Stock 2 : Damodar Industries Ltd (CMP :100)
Market cap :110Cr

The Damodar group is in the textile industry for more than three decades which has helped the company to establish strong relationships with almost 500 customers such as Arvind Mills Limited, D Decor Exports Private Limited, Donear Industries Ltd, and Siyaram Silk Mills. Moreover, it has an established clientele in China, South Korea, Bangladesh, Europe, the United States of America, and Egypt. Also, the Damodar group has established relationships with suppliers such as Reliance Industries Ltd 

Now like above company, there is nothing fancy with the past performance of the company while looking at the cash flow , this company is also making a huge expansion which is almost 2 times its market cap which caught my eye.

DIL is undertaking capital expenditure to set up a manufacturing facility at Amravati, budgeted at Rs 172 crore, funded in debt-to-equity ratio of 2:1. Phase 1 of the facility became functional in May 2018 and phase 2 is expected to be operational in August 2018. The entire plant is expected to be commissioned in April 2019.

 The company has already commenced the land and site development work, building & civil work, etc. The company has already initiated procurement of plant and Machinery and looking forward to its delivery, erection and commissioning of the same. On the basis of the progress made so far, the implementation of the project is going as per schedule and barring unforeseen circumstances the project would be completed as per schedule


Stock 3 : Manaksia Coated Metals & Industries (cmp: 8.5)

Manaksia Coated Metals & Industries Ltd (MCMIL) was incorporated on March 25, 2010 and was a dormant company till October 01, 2013 when the coated metal division and mosquito coil division of Manaksia Ltd (ML) were transferred to it under the scheme of demerger.

MCMIL has a colour coating line capacity of 39,000 MTPA in Kutch, Gujarat. The company is also into manufacturing of mosquito repellent coils. MCMIL is setting up a 1,08,000 MTPA Continuous Galvanizing line (CGL) for manufacturing of Galvanized steel coils/sheets at its existing plant at Kutch, Gujarat at a cost of Rs.74.61 crore. The project is expected to become operational in Q4FY18.

PLEASE NOTE THAT I AM NOT A SEBI REGISTERED ANALYST. I HAVE HOLDING IN THESE COMPANIES AROUND CURRENT PRICE AND MY VIEWS MIGHT BE BIASED.

Stock Analysis: SREI Infrastructure Finance Ltd

Company name:  SREI Infrastructure Finance Ltd
CMP: 38
Stock P/E : 5.27


(1) Company Overview

• SREI Infrastructure Finance Ltd, a Kanoria foundation entity, is one of India’s largest holistic infrastructure institutions delivering innovative solutions in the Infrastructure space.
• It has been engaged in leasing and hire purchase / hypothecation financing of construction equipment and financing of infrastructure related projects. 
• The company has been in this business for nearly three decades, and with a customer base of 77,000 and over USD 7 bn of consolidated AUM. It is one of the largest player in the infrastructure segment.

(2) Key Businesses And Strategy

(3) This was the main reason for my recommendation.  In the 2018 annual report, we can see that a company has made fixed asset investment which is more than its market cap which was the main thing which caught my eye. Imagine a company with a market cap of 2,300 cr making an investment of 2700 cr.

We will now look into below what is company plans

Asset Finance Business

• Leading financier in the Construction, Mining and allied Equipment (“CME”) sector in India offering loans and leases for new as well as used equipment • Promoted and 100% owned by Srei Infrastructure Finance Limited which has over 27 years experience in CE finance 

• Over 32.7% market share1 and customer base of 64,000+ current customers2 

• Distribution network of 89 branches across 21 states, 77 additional satellite locations and an employee base of 2,005 employees2 

• Strategic pan-India penetration through 120 SEPs2,4 and 191 OEMs partnerships2 

• Present across Tipper, IT, Farm & Medical Equipment Financing segments 

• Gross Earning Assets of INR 254,171 Mn2 with a 2.5 year CAGR of 15% 

CME Financing Industry: Poised for Growth

 Better geographic reach 

 Offer faster TAT1 

 Tailor made schemes 

 Higher LTV2 than banks 

 Simple documentation 

 Flexible terms

 Key Business and Strategy

Well positioned to access customers in the growing Indian infrastructure financing sector

 Since FY11, CME financing industry was dominated by NBFCs and select Banks 

 Currently, SEFL is the only end to end solution provider across the entire CME value chain 

 Disbursements of SEFL are the highest among the top five CME finance companies 

Equipment Centric Model Pushed by Long Standing OEM Tie-ups

• Financing of new and pre-owned Equipment 

• Equipment maintenance assistance through spare parts financing 

• Deploying financed equipment to projects 

• Branded refurbished equipment financing solutions 

• 77 stockyards across the country offer exit services efficiently 

Srei Entrepreneur Partners (SEPs)

 Exclusive distribution partners, SEPs, help in sourcing customers and ensuring regular repayment  Local risk insight and ground presence facilitates: • Customer acquisition • Screening • Broadening of market coverage 

 120 SEPs across the country

(4) Key Investment Highlights

A- Strong Growth Outlook  

• Increased outlay for Infrastructure & affordable housing to boost demand for CME 
• CME Finance expected to grow at a CAGR of ~ 19% up to FY20 
• Srei being the market leader is best positioned to ride this growth

B- Diversifying within Core Business

• Expanding Segment CME - Material Handling Equipment, Tipper , Used Equipment and Spare Parts 

• Expanding the Asset finance portfolio beyond the traditional CME segment i.e, Healthcare, IT, Rural 

• Provide Asset life cycle solution 

• Moving towards complete digitized platform to enhance customer experience

C- Improving Underwriting

• Leverage experience of being into infra sector for the last 28 years

• Improved credit underwriting through better insight & data analytics through digitization 

• Strategy beyond Asset writing - Down selling of portfolio to increase income through velocity

D- Cost Improvement

Maximize return through 

• Focus on PSL portfolio – Increase Securitization 

• Optimise borrowings and explore alternate avenues of funding to reduce cost. 

• Operating Leverage – Larger scale will optimize cost 

(7) Company price

Company price has corrected from a high of 120 in Nov 17 to almost 50's while the company has continued to report good profit on continuous basis QoQ. This fall is more due to small cap crash rather than company fundamentals. This makes the company price extremely attractive.

When compared with Peers, its not only one of the cheapest P/E share available right now but also one which has been declaring consistent dividend and showing consistent profit growth

As we can see below, the company has continued to show a strong profit and sales growth despite a decline in stock price 

Given the strong investment made by the company and the recent correction in share price while company constantly displaying strong financials makes this company an extremely attractive in current market condition.

Please note : The above case study was more for educational purpose. I am not a SEBI registered research analyst and my views might be biased. I have no investment in above stock.

Stock Analysis: Ahlada Engineering

Website: http://ahlada.com/
NSE SME IPO : Open till 18th Sep

Its a must subscribe IPO...below are the details about the company and why i am super positive on it

(1) The company is in the business of manufacturing steel doors and windows (steel-frame) and we cater to customers across various segments and industries. They currently have our facilities spread across 3 manufacturing units in addition to one assembling unit and stockyard, with an area admeasuring 34,211 square yards on the outskirts of Hyderabad. Additionally, they are also in the business of manufacturing cleanroom equipment for our customers in the pharmaceutical, biotechnology and food industries.

Below are the products of the company

(2)  Gradually expanding our manufacturing facilities and have over the past decade, expanded the facilities to its current form and capacity. Presently, they have an installed capacity to manufacture 11,000 doors per month.

(3)  Revenues and profitability for the last three years are depicted below:

(4) Ahlada is shifting its focus from clean door to steel door. They have got a big order from Tata steel for Pravesh door brands and this is the main reason why they are going for the IPO so that they can scale up their operation and meet the order

https://www.business-standard.com/article/companies/ahlada-engineers-takes-ipo-route-after-exclusive-biz-deal-with-tata-steel-118091000378_1.html

Also go through the website which will give you further information about this order

http://www.tatapravesh.com/

Management wants to expand their door supply from 11000 doors to 36000 doors per month with the proceeds of this IPO. 

Below are the IPO Details

Issue Open Date

11-09-2018

Issue Close Date

18-09-2018

Listing Date

N/A

Face Value (Rs)

10.00

Offer Price/Range (Rs)

147.00-150.00

Issued at (Value)

Premium (140.00)

Issue Size (Retail)

1131900.00Shares@150.00/share

Issue Type

Public Issue (Book Building)

The asking P/E of this IPO is around 24 however if we focus on the massive expansion which is expected then Forward P/E is in the range of 6-7 which I think its extremely cheap and with strong order book giving the backing to the management, this looks an extremely lucrative IPO to apply for esp with TATA backing.

Please note that I am not a SEBI registered. This is an educational website and given that I am applying for this IPO too so my views might be biased.

Stock Analysis: Virinchi Ltd

Market Cap:  274.00 Cr.
Current Price:  91.10
52 weeks High / Low  153.50 / 79.90 

Virinchi Limited is a Hyderabad-based company. It is engaged in the information technology sector.

The company has expanded into the healthcare sector. It has set up a 600-bed super specialty hospital in Banjara Hills by making an investment of Rs 300 crore.The hallmark of the new facility of Virinchi Hospitals is customer centric technology applications, diagnostic facilities, molecular diagnostics and personalised medicine.

Vrinchi Hospital will have specialties in cardiac, ortho, nephro, neuro, emergency, cancer and transplantation. It will be equipped with several firsts in Indian healthcare industry such as 15,000 plus biomarker diagnostic lab, full spectrum radiology markers among other equipment.

There will be an insurance driven cashless hospital facility accessible to all sections of people. Differential pricing would be based on the type of room the patient uses.

Canara Bank and other lenders have given Virinchi Healthcare Private Limited Rs 70 crore. The remaining funds for the project were raised from internal sources.

Vrinchi Healthcare has employed 75 expert doctors, of whom about 30 are already on board. The total employment to be provided to paramedical and other supporting staff will be to the tune of 1,000.

Now going through the financials of the company, we can certainly see that its like a sitting duck at the moment trading extremely cheap with great potential

Few financials highlights 

Stock P/E: 7.58 
Dividend Yield: 0.00 % 
ROCE: 13.83 % 
ROE: 14.28 % 
Sales Growth (3Yrs): 36.40 % 
Change in promoter holding: 2.86 %
Change in promoter holding 3Years: 20.35 %

Company price in recent months has corrected by almost 30% making it an extremely lucrative investment.

Cash flow:

Lets first focus on the cash flow statement of the company in order for me to link the entire story. We can see that for a company which has a market cap of 274Cr, it has purchased fixed asset of almost its market cap in last 2yrs to expand its operation. This is indeed quite a substantial investment for a company of this size

 Quarterly result
We can see the effect of above investments in the increase in revenue and profit on a continuous basis in the company financials in last 4-5 quarters where it has consistently reported good numbers while share price hasn't reflected it yet due to the brutal fall in the small cap sectors recently.

We can also see that among all the peers it has it has one of the best ROE

Peers comparison

Overall i think its a very attractive investment but being small-cap its risky as an category. This company certainly shows the glow and with current P/E around 8 while recent promoter holding increase along with massive investments in fixed assets coupled with good financial performance, do you think the share price is trading cheap? i think yes

note: This is a educational website. I am not a SEBI registered advisor. My views on this company might be biased.