Japanese Pivot
Close Race to grab and grow(w)
Premium travelling
BluSmart EV expanding
Flying high on cloud Nine : Bitcoin
Positional Stocks 17-Mar-24
Market took away updated SL and we did not lose anything on the positions. Following process saved us
No positions as of now. From January to March we have gradually reduced from 8 to 6 to 4 to 3 positions and did not add new ones. It really helped in this fall from Positional portfolio perspective
Act of faith
Road to Junk
India Vs Vietnam Vs Bangladesh
Terminal Capacity
Chinese Skincare
Blockchain vs Generative AI
Another dimension to Red sea Crisis
All Time high : Who will blink first
RED SEA Crisis
STOP!
Reverse Bidding : U turn
Sportwear Industry : Medium Term trend
Protected: Alpha Sunrise 3-Mar-24
Protected: Positional Stocks 3-Mar-24
Protected: Premium Stocks : 3-Mar-24
OSAT
Hydrogen electrolyser : Aatmnirbhar
Giant Bottleneck
Powerful drugs
Ultra HNI
MF AUM vs Bank Deposits
Electricity Demand
Biohydrogen
Xiaomi : EV connection
Cocoa vertical takeoff
DAC : Defense Aatmnirbhar version
Nuclear energy
50% cheaper
Infinite ROE
Market size : Electric Auto components
Cost of energy
Protected: Positional Stocks 17-Feb-24
TATA ATMP
Flee Paytm !!
SaaS fees : Indian Discounts applicable
Real Estate and Other Assets
29 Institutions!!
$8-billion chip fabrication plantÂ
Transportation Solutions
Disclaimer – Analysis is NOT a BUY/SELL/HOLD Recommendation. It can be used for educational purposes. There could be lot of things which might have been missed in analysis either due to lack of information or oversight etc.. Do your own diligence & contact your expert financial adviser before making any investment decision.
AVG logistics
Also Read Pick1, Pick2, Pick3, Pick4, Pick5, Pick6, Pick7, Pick8, Pick9
Business
AVG Logistics Ltd, incorporated in 2010, provides road transportation services, warehousing facilities and Railway transportation to various domestic and multinational companies. AVG Logistics provides customized and technology-driven solutions across transportation, warehousing, distribution, and supply chain management. Furthermore, the Company also offers Third-Party Logistics Services (3PL), effectively complementing its wide range of logistics solutions. Company mission is to offer an integrated Multimodal network of Logistics
solutions across varied industries
Products, Segments and Strengths
Transportation: Express Delivery, Refrigerated Transportation, Freight Forwarding, etc
Warehousing: Manpower Handling, Packaging, Multi-User Warehouse facility, etc
Value-Added Services like custom clearance, E2E solution, Multimodal transportation, Reverse logistics, etc.
The Co. also undertakes transportation services to Nepal, Bangladesh and Bhutan
AVGL had the agreement of 1 – 3 years with all its major customers and the agreement includes the escalation clause based on the 5% change in the diesel cost
Fleet Size
The Co as of 31st December 2023 has a fleet size of more than 3000+ vehicles, including hired & owned dry/reefer vehicles. Owned vehicle fleet is approx 500+
Network
The Co has a pan India presence with 50+branches and 7 zonal offices.
Company caters to 6 rail routes and can deliver 1 to 40 tons of logistics
9 trans-shipment hubs for LTL services, 1 owned fleet maintenance hub
~7,.05L sq. ft. of warehousing footprint pan India ( 81,000+ sq. ft. Owned and 6.24L leased Warehousing Space). Further expansion happening
Company has certain moats/advantages wrt new entrants in terms of
- 3 decades of promoter experience
- End to end solution provider
- Multimodal transport
- Distribution network is strong pan India
- Client relationships with dedicated warehouses for Nestle, HUL and Mother dairy
- Reverse logistics
- Tech-enabled fleet with GPRS systems
- and Asset light model of fleet
- Company also offers Rail logistics
- Also offers Cold chain logistics
- Versatile Solutions For Efficient Storage & Operations (caters to liquid, container, Agri, FMCG, chemicals)
It offers a range of rail logistics services to its customers, including Full rack and piece meal transportation, container movement, and terminal management across all CONCOR ICDs. This is very important in bigger scheme of things in coming years
Cold chain logistics is the segment to watch out for in coming decade
Company has a clear focus on Tech Initiatives regarding its operations. Company keeps on finding Disruptive & Innovative Customised Solutions. Zero Residual Food Grade Tanker is one of the solutions. Curtain Multi-door Truck is another solution
Clients
Reputed clientele in diverse sectors like FMCG, Chemicals, Power, Electrical, automotive like Nestle, Mother Dairy, ITC Ltd, Coca-Cola etc
Well recognized by clients and external agencies in terms of awards and recognition
Fundamental Ratios, Cash, Loans, EBITDA,PAT margin, Shareholding pattern
Similarly ROCE and ROE are decent.
Debt to Equity is high and needs to be closely monitored
Cash conversion cycle is stable and Working capital days are also stable
Shareholding pattern
Promoter has skin in game. FII adding, DII selling. Public domain have few strong holdings as well but overall public holdings have increased
ALSO READ : SS7 (Diwali to Diwali)
Recent Developments in last 1.5 years
Tie up with railways :Signed 6 tenders worth ₹510 cr with Indian Railways for 6 leased parcel trains.
They also got 150 crore contract from Indian Railways for operations of Leased Parcel Express Train. This special train, connecting Bangalore to Ludhiana (Punjab), will complete one round trip every week over the next 6 years, totaling 313 trips. The Express Service will cover the distance in ~72 hours ensuring expeditious, seamless connectivity between the important locations. Ludhiana is an invaluable addition to our railway network, opening doors to a gigantic textile market -largest hosiery manufacturing, cotton textiles, cycle manufacturing amongst others
QSR clients :Started servicing QSR clients
Expanding the cold chain and parcel division. Company is acquiring 50+ fleet of cold chain vehicles to enhance its cold chain capabilities
Also is Upcoming 50,000 sq. ft. Owned Warehousing Space In Agartala
JV : Joint Ventured with Sunil Transport for liquid logistics.
EV Fleet : They are planning to introduce electric vehicles in their fleet in the future.
Company also recently had a collaboration with Blue Energy Motors (BEM), India’s only LNG truck manufacturers. This represents a significant leap towards a more sustainable and eco-friendly future in the transportation industry. This landmark collaboration is formalized through a strategic Transportation as a Service (TAAS) Agreement, wherein AVG Logistics and BEM join forces to integrate LNG-powered vehicles. The collaboration underscores a shared commitment to advancing sustainable transportation practices and fostering a greener future.
Backward integration for last mile : Incorporated a Wholly owned subsidiary named ‘Galaxy Packers and Movers’
They have onboarded Gazal Kalra, co-founder of Rivigo, as a strategic advisor to guide them on sustainability and technology. She also Subscribed to Warrants at 371 Rs
Company has also raised funds at 371 Rs/Share through
- ISSUE OF CONVERTIBLE WARRANTS ON PREFERENTIAL BASIS TO PERSONS BELONGING TO PROMOTER CATEGORY
- ISSUE OF CONVERTIBLE WARRANTS ON PREFERENTIAL BASIS TO PERSONS BELONGING TO NON-PROMOTER CATEGORY
- ISSUE OF EQUITY SHARES ON PREFERENTIAL BASIS TO NON-PROMOTERS
Govt Initiatives to Improve Infrastructure aid Logistics growth : India aims to reduce logistics cost from 13% – 14% of GDP to 8% – 10% of GDP. It is estimated that a 10% reduction in indirect logistics cost will result in 5% to 8% rise in exports. GOI to undertake multiple logistics specific initiatives, such as GatiShakti, National Logistics Policy and others. These programs aim to streamline India’s logistics sector by making it more green, agile, transparent and integrated.
Valuations
Expected sales projections for FY25 is ~700cr and with PAT margin of ~7-8.5%, we get PAT of 50-60 cr. So stock price may move towards 700-900 by 31Mar25. There could be volatility in stock which can be used for accumulation
Risks
High Debt to Equity Ratio. This needs to be monitored very closely
New warehouse opening and its utilization
Renewal of contracts with customers on favourable terms needs to be watched out
High capital working requirements remain a risk.
High competitive industry
Technicals on 11Feb24
Stock has been consolidating between 400-460
Technical chart on 16 Mar24
Conclusion
If you have understood the triggers and industries it cater to + RISKS which can materialize and have patience then think of buying this company in every dip, market offers, else Ignore the stock
Stock might be volatile in short term and give a chance to buy for long term investment purpose
Disclaimer – Analysis is NOT a BUY/SELL/HOLD Recommendation. It can be used for educational purposes. There could be lot of things which might have been missed in analysis either due to lack of information or oversight etc.. Do your own diligence & contact your expert financial adviser before making any investment decision.
In case you have any questions/ queries, please feel free to reach me through Contact Form
Do spread the word among your peers, family members or anyone who can benefit from this blog and asked them to subscribe. But be selfish and take care of yourself first by subscribing before they do.
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Indian Digitisation
CV Slowdown!!
Capex is the key
Disclaimer – Analysis is NOT a BUY/SELL/HOLD Recommendation. It can be used for educational purposes. There could be lot of things which might have been missed in analysis either due to lack of information or oversight etc.. Do your own diligence & contact your expert financial adviser before making any investment decision.
Kilburn Engineering
Read Pick1, Pick2, Pick3, Pick4, Pick5, Pick6, Pick7, Pick8, Pick9, Pick10
Business
Kilburn Engineering Limited is primarily engaged in designing, manufacturing and commissioning customized equipment / systems for critical applications in several industrial sectors viz. Chemical including Soda Ash, Carbon Black, Steel, Nuclear Power, Petrochemical and Food Processing etc.
Company has cutting-edge manufacturing facility for fabrication, machining, and assembly of equipment located in Thane, Maharashtra (India). Manufacturing plant spans an area of 30,960 square meters and is equipped with state-of-the-art technology and machinery.
Products, Segments and Strengths
Company operates in two segments viz. Process Equipment and Tea Drying Equipment
Food Processing Equipment -During FY23 Company had bagged a total of 103 orders in the domestic market and 5 from overseas Market
for tea dryers
40+ Years of rich experience with 3,000+ Installations globally done
200+ Workforce and 15+ Sectors catered by products and solutions
Kind of Equipment’s & system’s orders got by company
- Silos for storage of PTA.
- Metal extraction plant for extraction of exotic material from refinery spent catalyst.
- Dryer, cooler, Granulator and Coater for fertilisers.
- Calciner package for API (Active Pharmaceutical Ingredients) industry.
- Hydrogen Fluoride Reactor package (Rotary Kiln)
- Rotary Dryers
- VFBD for wet clay
- Tea Dryers and others
In the wake of increasing concerns about environmental degradation, our Paddle dryers have emerged as a sustainable solution for drying sludge. These advanced dryers play a vital role in states where strict pollution norms have been enforced, making it imperative for industries to adopt ecofriendly practices. By efficiently removing moisture from sludge, these dryers significantly reduce the volume of waste generated, thereby minimizing the environmental footprint of industrial processes
Sewage treatment — The market size for water and wastewater management in India was 216.03 billion in 2022. By 2027, it is anticipated to grow to
518.15 billion, with a projected CAGR of 15.95% during the period 2023-2027.
On similar note, many other industries catered by Kilburn are expected to grow at 5-14% CAGR till 2030 and further
Eextensive and sophisticated R&D facility that are equipped with a full range of pilot plant dryers,
including
- Paddle Dryers
- Vacuum Paddle Dryers
- Band Dryers
- Fluid Bed Dryers,
- Vibrating Fluid Bed Dryers
Company has good manufacturing capabilities and order book of 236cr in hand at 31st Dec23.
Order received in Q3FY24 94cr. Executed 73cr
Continuous order inflow in Q4FY24 as well
Order Enquiries –> Approx 100cr
Clients
Reputed clientele lik ACC, JSW , Reliance, Arvind, PCBL, Fnolex, Granules, Coromandel, SRF, LnT and many other renowned names
Professional Management team
Fundamental Ratios, Cash, Loans, EBITDA,PAT margin, Shareholding pattern
Similarly ROCE and ROE are at reasonably good levels
Debt to Equity is under control
Sales, OPM, Net profit has been on rising trend continuously
Cash conversion cycle needs to be monitored.
Working capital days are good and have been improving
Shareholding pattern
Promoter has skin in game. One of the old promoters has been selling and other has been buying. Now its settled and Public domain have few strong holdings as well.
ALSO READ : SS7 (Diwali to Diwali)
Recent Developments
Promoter buying from open market
Promoter has been buying from open market continuously. Good buying happened between 270-310 zone
Last buy around 320
Acquisition of ME energy 
This acquisition will help the company to grow faster
Company has put an estimated target of 500cr revenue by FY25 as ME energy has a 118cr pending order book
Capex
Expecting small capex of 15-20 cr till Dec25
Valuations
Expected Cumulative sales projections for FY25 is ~500cr (considering orders and Acquisition) and with PAT margin of ~12% after merger, we get PAT of 60 cr. So stock price may move towards 500 by 31Mar25. There could be volatility in stock which can be used for accumulation
Risks
Chequered history of non-payment of loans and subsequent new promoters on board.
Due to the non-payment of its loan obligations to RBL Bank Limited (RBL) starting in March 2020, KEL underwent debt restructuring in FY21. The resolution plan (RP) sanctioned by RBL in accordance with the Reserve Bank of India’s criteria was accepted by the company board on March 4, 2021, and it was put into effect on March 31, 2021. As per the RP, the outstanding principal loan of Rs 95 crores and interest of Rs 9 crores due to RBL up to 31 March 2021 was to be restructured. As part of the debt restructuring, Rs 65 crores of sustainable debt was converted into long- term loans with a 12.5 year payback period at an annual interest rate of 9%, Rs 13.5 crores in equity shares were allocated to RBL, and Rs 25.5 crores in 0.01% cumulative redeemable preference shares (CRPS) were also allocated to RBL.
Chemical companies are facing challenge to make sales. Their capex plan may be delayed further leading to slow flow of order to companies like Kilburn
Economy impact because of possible US recession might delay things by a year or more
High capital working requirements remain a risk.
Delay in Acquisition of ME energy. This is major risk in short term
Technicals on 10Feb24
Stock has been consolidating between 260-290 for almost few months and given a breakout recently and then got good results as well
Technicals on 31-Mar-24
Survived well in last one month market correction
Conclusion
If you have understood the triggers and industries it cater to + RISKS which can materialize and have patience then think of buying this company in every dip, market offers, else Ignore the stock
Stock might be volatile in short term and give a chance to buy around 270-340 range for long term investment purpose
Also Read : ICEMAKE Refrigeration : Time to Chill
Disclaimer – Analysis is NOT a BUY/SELL/HOLD Recommendation. It can be used for educational purposes. There could be lot of things which might have been missed in analysis either due to lack of information or oversight etc.. Do your own diligence & contact your expert financial adviser before making any investment decision.
In case you have any questions/ queries, please feel free to reach me through Contact Form
Do spread the word among your peers, family members or anyone who can benefit from this blog and asked them to subscribe. But be selfish and take care of yourself first by subscribing before they do.
Enjoy the day and your life. Don’t forget, we are alone in this grand universe and may not get a chance to live again.
Protected: Time for Logistics
Protected: Positional Stocks 10-Feb-24
Wind power giants facing challenges
Medical Devices
ICE to H2ICE
Radialisation Effect
SS-7
EMS limited
CMP 569, Market cap ~3150cr
ROCE ~32%, ROE ~24%, D/E ~0.07 PE ~29 (based on screener)
Also Read Pick1, Pick2, Pick3, Pick4, Pick5, Pick6
🟢EMS Limited is a multi-disciplinary EPC company, headquartered in Delhi that specializes in providing turnkey services in water and wastewater collection, treatment and disposal. EMS provides complete, single-source services from engineering and design to construction and installation of water, wastewater and domestic waste treatment facilities
🟢The company provides Sewage solutions, Water Supply Systems, Water and Waste Treatment Plants, Electrical Transmission and Distribution, Road and Allied works, operation and maintenance of Wastewater Scheme Projects (WWSPs) and Water Supply Scheme Projects (WSSPs) for government authorities/bodies.
🟢Healthy Order book of ~2100cr provides strong visibility of revenues over next few years. Company has repeat orders from various Government departments.
🟢EMS promoters have more than a decade of experience in executing water supply and sewage treatment projects
🟢Since incorporation, it has completed 67 projects in Bihar, Uttarakhand, Madhya Pradesh, Rajasthan, and Haryana. It has executed many projects awarded by government bodies such as Uttar Pradesh Jal Nigam (UPJN), Construction and Design Services (C&DS), Military Engineering Services (MES), and Indian Railway Construction Limited (IRCON). It has completed 4 O&M projects in last 4 years.
🟢Key clientele includes government bodies like Municipal corporation of Rajasthan (under AMRUT Scheme), Uttarakhand Urban Sector Development Agency and Bihar Urban Infrastructure Development Corporation (under National Mission for Clean Ganga ) and CPWD, Maharashtra
 🟢EMS Limited has its own civil construction team and employs 57+ engineers, supported by third-party consultants and industry experts.
🟢Projects are mostly funded by World bank
🟢Development of Tier 2 Tier 3 towns, capital expenditure by Government gives good visibility for few years
🟢Promoter has sufficient skin in game with approx. 70% holdings, Sales are increasing and NPM is good
Risks
🔴Company works in a field of high capital intensive business and receivables will remain high
🔴Project execution risks within a budget are the ones which constantly hurts companies in these kind of businesses
🔴The company has not executed any HAM projects in the past but is executing one HAM project for the UP Jal Nigam. It has entered a joint venture with Ercole Marelli Impianti Tecnologici S.R.L. Italy.
🔴Revenue concentration from few clients/states poses a risk
Technical chart
In case you have any questions/ queries, please feel free to reach me through Contact Form
Do spread the word among your peers, family members or anyone who can benefit from this blog and asked them to subscribe. But be selfish and take care of yourself first by subscribing before they do.
Enjoy the day and your life. Don’t forget, we are alone in this grand universe and may not get a chance to live again.