Value Picks – Long term Investments

Wealth creation with Long term investment 5-10-15-20 years

Subscribe Paid investment Newsletter
Join Telegram Channel
Paid Portfolio Plans

Author: valuePicker

  • Britannia Q3 Results: Revenue Jump, ₹500Cr Expansion, 12-15% CAGR Target

    Britannia Industries Q3 FY2025 results Analysis

    Britannia Industries Limited

    Q3 FY2025 Results Research Report

    Stock Overview

    ₹1,19,376 Cr.
    Market Cap
    ₹4,956
    Current Price
    ₹6,473 / ₹4,641
    52-Week High/Low
    54.9
    Stock P/E
    ₹133
    Book Value
    1.48%
    Dividend Yield
    48.9%
    ROCE
    57.1%
    ROE

    Q3 FY2025 Financial Performance

    ₹4,592.62 Cr.
    Revenue
    ↑ 7.9% YoY
    ₹582.3 Cr.
    Net Profit
    ↑ 4.8% YoY
    ₹826.50 Cr.
    EBITDA
    18.0% Margin
    ₹24.15
    EPS
    vs ₹23.11 YoY

    Expense Analysis

    Cost of Materials Consumed ₹2,629.90 Cr. (57.2%)
    Employee Benefits ₹105.85 Cr. (2.3%)
    Finance Costs ₹44.56 Cr. (1.0%)
    Depreciation & Amortization ₹82.38 Cr. (1.8%)
    Other Expenses ₹827.60 Cr. (18.0%)
    Total Expenses ₹3,874.65 Cr. (84.4%)

    Strategic Growth Plans

    Capacity Expansion & Capex

    ₹500-600 Cr. targeted investment towards:

    • Manufacturing automation
    • New production units in rural India
    • Dairy business expansion
    • International expansions

    Product & Brand Strategy

    • New health & wellness products
    • Premium biscuit segment expansion
    • Dairy-based product innovation
    • Premium category focus

    Digital & Rural Expansion

    • E-commerce platform integration
    • Direct distribution network
    • Rural market penetration
    • Digital sales channels

    Competitive Landscape

    Competitor Revenue (₹ Cr.) Market Share Key Strengths
    Britannia 17,580 36% Brand loyalty, strong margins, rural reach
    Parle 16,200 34% Mass-market dominance, affordability
    ITC 10,500 20% Strong advertising & premium offerings
    Nestlé 17,500 10% Diversified portfolio, dairy dominance

    Key Risks & Challenges

    Commodity Inflation

    Wheat, milk, and sugar price fluctuations may pressure margins

    Cost-push inflation could lead to pricing challenges

    Regulatory Risks

    FSSAI regulations on sugar & fat content

    Increased taxation on packaged food items

    Competition

    ITC’s aggressive marketing in premium biscuits

    Parle’s deep penetration in rural India

    Market Risks

    Currency & export risks in international markets

    Consumer demand slowdown impact

    Valuation & Investment Thesis

    54.9x
    P/E Ratio
    Premium vs. Industry Avg ~40x
    37.3x
    Price-to-Book (P/B)
    Reflects high ROE
    ~35x
    EV/EBITDA
    Premium due to margins
    1.48%
    Dividend Yield
    Stable payout policy

    Investment Rationale

    • High ROE (57.1%) & ROCE (48.9%) indicating efficient capital utilization
    • Consistent earnings growth with sales growth of 8.5% CAGR (3Y avg)
    • Resilient business model with market leadership and strong pricing power
    • Strategic expansion into dairy & bakery segments as future growth drivers
    • Defensive FMCG stock providing steady earnings across economic cycles

    Final Verdict: HOLD with Positive Bias

    Premium
    Valuation
    P/E 54.9x
    5-8%
    Short-Term Growth
    Stable margins
    12-15%
    Long-Term CAGR
    3-5 years outlook
    ₹4,500-4,700
    Accumulation Range
    Buy on dips

    Additional Performance Metrics

    5.12%
    Sales Growth (YoY)
    0.72%
    Profit Growth (YoY)
    8.48%
    Sales Growth (3Yrs)
    4.89%
    Profit Growth (3Yrs)
    50.6%
    Promoter Holding
    24.1 Cr.
    No. of Equity Shares
    ₹2,754 Cr.
    Debt
    ₹3,186 Cr.
    Reserves

    Disclaimer

    This report is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence or consult a financial advisor before making any investment decisions.

  • Websol Energy: 600% Revenue Surge, ₹580 Cr Projected Growth, Solar Manufacturing Powerhouse in 2025

    Websol Energy System Limited – Q3 FY2025 Results

    Websol Energy System Limited

    Q3 FY2025 Result Research Report

    Value pick Multibagger stock for long term

    1. Executive Summary

    Websol Energy System Limited has demonstrated a strong financial recovery in Q3 FY2025, achieving substantial revenue and profitability growth. The company’s expansion initiatives, focusing on increasing solar cell and module production capacity, position it as a key domestic player in India’s renewable energy sector.

    2. Financial Performance

    Revenue

    ₹147.31 crore in Q3 FY2025

    2.2% QoQ increase

    Significant YoY surge from ₹0.51 crore in Q3 FY2024

    EBITDA

    ₹67.90 crore

    7.9% QoQ growth from ₹62.95 crore

    Driven by supply chain efficiencies

    Net Profit

    ₹41.56 crore in Q3 FY2025

    Compared to loss of ₹(54.64) crore in Q3 FY2024

    Margins: EBITDA 46.1%, Net Profit 28.2%

    3. Future Growth Plans & Expansion Strategy

    Phase I Expansion

    • Commissioned 600 MW Mono PERC Bifacial Solar Cell Line
    • Commissioned 550 MW Fully Automated Module Line at Falta, West Bengal facility

    Phase II Expansion

    • Additional 600 MW Mono PERC Bifacial Solar Cell Line
    • Expected to commence production by July 2025
    • ₹220 crore investment funded through internal accruals and external financing

    Phase III Expansion

    • Greenfield project under evaluation
    • Board considering Joint Ventures or forming a subsidiary to scale solar business

    4. Products & Market Position

    Solar Cells

    • Entire FY2024-25 production capacity is fully booked
    • Strong demand expected for Phase II capacity by end of FY2025

    Solar Modules

    • Secured orders worth ₹116 crore for exports
    • Export markets include US, UK, Africa, and India
    • Reflects strong global market penetration

    Competitive Advantage

    • Advanced technology in Mono PERC Bifacial Cells
    • Improving efficiency
    • Reducing dependency on imports

    5. Capital Expenditure & Strategic Rationale

    • Investment in capacity expansion aligns with Indian government’s push for domestic solar manufacturing
    • Accelerated depreciation of assets indicates rapid technological upgrades
    • Expansion positions Websol to capture higher market share in solar energy value chain

    6. Competitive Landscape & Risks

    Competition

    • Faces competition from domestic players like Tata Power Solar and Adani Solar
    • Competes with international manufacturers

    Regulatory & Policy Risks

    • Potential impacts from changes in government subsidies
    • Import duty modifications
    • Shifts in renewable energy policies

    Supply Chain & Input Costs

    • Potential fluctuations in raw material prices
    • Sensitivity to silicon wafer and glass price changes
    • Possible margin impacts

    Technology Obsolescence

    • Rapid advancements in solar technology
    • Necessitates continual investment
    • Need to stay technologically competitive

    7. Valuation & Investment Thesis

    • Strong order book and growing margins
    • Projected FY2025 Revenue: ~₹540-580 crore post Phase II commissioning
    • Potential P/E Multiple: 15-18x
    • Attractive growth investment with robust market positioning

    8. Conclusion & Disclaimer

    Websol Energy System Limited is on a strong growth trajectory, supported by its expansion initiatives and robust demand. However, risks related to competition, policy changes, and technological shifts should be monitored.

    Disclaimer

    This report is for informational purposes only and does not constitute investment advice. Investors should conduct their due diligence before making any investment decisions.

  • Sai Silks Q3: 44% PAT Growth, 12 New Stores Planned for FY26

    Sai Silks (Kalamandir) Ltd. – Q3 FY2025 Results

    Sai Silks (Kalamandir) Ltd.

    NSE: KALAMANDIR | Q3 FY2025 Results

    Value Pick Multibagger Stock for long term investment

    Investment Highlights

    Market Cap

    ₹2,767 Cr

    Current Price

    ₹180

    52-Week Range

    ₹253 / ₹144

    P/E Ratio

    27.5x

    Book Value

    ₹70.0

    Dividend Yield

    0.55%

    ROCE

    15.9%

    ROE

    13.8%

    Q3 FY2025 Financial Performance

    Financial Metric Q3 FY2025 Q3 FY2024 % Change (YoY)
    Revenue from Operations ₹448.56 Cr ₹382.45 Cr +17.3%
    EBITDA ₹78.91 Cr ₹58.20 Cr +35.6%
    EBITDA Margin 17.6% 15.2% +240 bps
    PAT ₹46.02 Cr ₹31.98 Cr +43.9%
    PAT Margin 10.3% 8.4% +190 bps

    9M FY2025 Performance

    • Revenue: ₹1,063.17 Cr (+4.86% YoY)
    • EBITDA: ₹153.20 Cr (-2.93% YoY)
    • PAT: ₹71.88 Cr (-0.35% YoY)

    Growth Strategy & Store Expansion

    Current Stores

    66 stores across 18 cities

    Total Retail Area

    6.85 lakh sq. ft

    Revenue per Store

    ₹22.9 Cr (FY24)

    FY26 Target

    8-12 new outlets

    Omnichannel Strategy

    • Coverage: 25 states & 6 Union Territories
    • Features: Live commerce, social media shopping, influencer-led promotions
    • E-commerce Target: 10-12% of total revenue in next two years
    • Average Online Order Value: ₹4,664

    Product Portfolio

    Brand Category Target Segment Price Range
    Kalamandir Mid-range ethnic wear Middle-income ₹1,000 – ₹1,00,000
    Mandir Ultra-premium designer sarees Affluent customers ₹6,000 – ₹3,50,000
    Varamahalakshmi Premium wedding & handloom sarees Upper middle class ₹4,000 – ₹2,50,000
    KLM Fashion Mall Ethnic & value fashion Budget-conscious buyers ₹200 – ₹75,000

    Competitive Analysis

    Competitor Presence Business Model Competitive Advantage
    Sai Silks (Kalamandir) South India Offline + E-commerce Strong saree segment dominance
    Nalli Silks National Offline-focused Legacy premium saree brand
    Reliance Trends Pan-India Offline + Online Aggressive discounting
    FabIndia National Offline + Online Focus on handloom and organic
    Manyavar National Offline + Online Premium men’s ethnic wear

    Key Risks & Challenges

    • Consumer Spending Volatility: Potential slowdown in wedding and festive demand
    • Raw Material Price Inflation: Fluctuations in silk, handloom fabrics, and cotton prices
    • Competition: Digital-first brands expanding in ethnic wear segment
    • Regulatory & Taxation: Potential GST rate changes impact
    • Debt & Expansion Risk: Debt reduced from ₹257.75 Cr to ₹159.10 Cr

    Valuation & Price Target

    Metric FY25E FY26E
    Expected EPS ₹7.2 ₹8.3
    Target P/E Range 30-32x 30-32x
    Fair Value Range ₹215-230 ₹250-265

    Valuation Metrics

    Current P/E

    27.5x

    In line with sector average

    ROCE

    15.9%

    Strong capital efficiency

    ROE

    13.8%

    Healthy returns

    Debt Reduction

    ₹98.65 Cr

    Improved financial flexibility

    Industry Growth Potential

    The Indian wedding & festive wear market is expected to grow at 27.3% CAGR

    Investment Thesis & Recommendation

    Bullish Scenario

    Stock could reach ₹250+ in the next 12-18 months, driven by:

    • Strong festive demand
    • Successful store expansion
    • Margin improvement
    • E-commerce growth

    Bearish Scenario

    Downside support at ₹160-170, potential risks:

    • Weakening consumer spending
    • Intense e-commerce competition
    • Raw material cost pressures
    • Execution challenges in expansion

    Final Investment Call

    Moderate Buy – Strong long-term growth story with valuation re-rating potential

    Company Strengths

    • Market Leadership: 69.5% of total revenue from saree segment
    • Regional Dominance: Strong presence in South India, which contributes 50% of total saree market
    • Operational Excellence: Templatized store roll-out model ensures higher efficiency
    • Brand Portfolio: Well-positioned brands across price segments
    • Financial Health: Improving margins and reducing debt levels

    Conclusion

    Sai Silks (Kalamandir) is well-positioned to capitalize on India’s fast-growing organized ethnic wear market. The company demonstrates:

    • Strong revenue growth trajectory
    • Improving operational margins
    • Successful omnichannel expansion
    • Clear growth strategy with focus on premium segments
    • Robust brand portfolio across price points

    While competition and macroeconomic risks need to be monitored, the company’s strong fundamentals and growth strategy make it an attractive investment proposition for long-term investors.

    ⚠️ Disclaimer

    This report is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence before making any investment decisions. Past performance is not indicative of future results.

  • VRL Logistics Q3 FY2025: Revenue Growth, Strategic Expansion in Logistics & Digital Transformation

    VRL Logistics Ltd – Q3 FY2025 Result

    VRL Logistics Ltd – Q3 FY2025 Results

    Value Pick Best Stock to buy for long term investment

    Market Cap

    ₹4,081 Cr

    Current Price

    ₹467

    52-Week High/Low

    ₹705 / ₹432

    Stock P/E

    31.3

    Dividend Yield

    1.07%

    Promoter Holding

    60.2% (Down -9.35% over 3 years)

    Q3 FY2025 Financial Performance

    Revenue Growth

    • The company reported a 12% YoY growth in quarterly revenue, reflecting steady demand for logistics and freight services.

    • Revenue for 9M FY2025 reached ₹3,120 Cr, indicating sustained business expansion.

    • Sales Growth (YoY): 10.7%

    • Quarterly Sales Growth: 12.0%

    • 3-Year Sales Growth: 17.9%

    Profitability & Margins

    • PAT for Q3 FY2025: ₹130 Cr (Up 1.62% YoY)

    • Profit Growth (YoY): 1.62%

    • 3-Year Profit Growth: 24.7%

    • Operating Profit Margin (OPM): 15.8%

    • Net profit growth was impacted by rising operational expenses, but cost efficiency measures helped limit margin contraction.

    Balance Sheet Strength

    • Debt: ₹1,027 Cr

    • Reserves: ₹907 Cr

    • Book Value: ₹114

    • ROE: 9.00%

    • ROCE: 10.7%

    • Suggests stable but underwhelming return ratios.

    Key Business Developments

    Strategic Asset Sales

    • Sale of Non-Core Assets: VRL sold land and buildings to a promoter group company for ₹1,488.00 lakh, realizing a profit of ₹1,136.77 lakh.

    • This is part of its strategy to divest non-core assets and focus on its logistics business.

    Business Restructuring

    • Exit from Passenger Air Transport Business: The company completed the sale of this division in July 2023 for ₹1,700 lakh.

    • This move streamlines focus on road transport logistics, improving capital allocation.

    Dividend Decision

    • No Interim Dividend Declared for Q3 FY2025

    • Signaling a conservative capital management approach to maintain cash reserves.

    Future Growth Plans & Expansion Strategy

    1. Fleet Expansion & Modernization

    • Investing in new trucks and upgrading fleet to improve efficiency

    • Focus on fuel-efficient vehicles to mitigate fuel cost volatility

    • Expansion into electric and CNG-based fleets under evaluation to align with sustainability goals

    2. Warehouse & Hub Expansion

    • Investing in new logistics hubs in high-demand regions

    • Key expansion locations: Tier-2 and Tier-3 cities to improve regional penetration

    3. Technology & Digital Transformation

    • Increased adoption of AI-powered logistics tracking and route optimization software

    • Aims to reduce turnaround time and improve efficiency

    • Implementing automated warehouse management systems (WMS)

    • Enhanced inventory tracking and delivery efficiency

    4. E-commerce Logistics Growth

    • Aims to expand last-mile delivery network for e-commerce giants

    • Segment expected to contribute higher revenue growth due to rising online retail demand

    Capital Expenditure (CapEx) Strategy

    Investment Area Planned Spending Strategic Benefit
    Fleet Expansion ₹400-500 Cr over 2 years Increase market share & efficiency
    Hub & Warehouse Infrastructure ₹200-250 Cr Strengthen supply chain
    Tech Investments ₹100 Cr Enhance tracking & route efficiency
    Sustainability Initiatives ₹150 Cr Reduce fuel cost & emissions

    CapEx Focus: Enhancing efficiency, cost reduction, and geographic expansion.

    Rationale: Strengthen operational capabilities while maintaining profitability.

    Competitive Landscape

    Company Market Cap (₹ Cr) P/E Ratio ROE (%) OPM (%)
    VRL Logistics 4,081 31.3 9.00 15.8
    TCI Express 6,800 45.2 18.1 19.5
    Blue Dart 11,500 52.4 16.4 18.2
    Mahindra Logistics 4,200 38.7 10.5 12.8

    VRL’s Competitive Position

    Strengths:

    • Asset-heavy model ensures greater control over fleet operations

    • Strong regional network in South and West India

    • Consistent revenue growth despite economic cycles

    Challenges:

    • Rising fuel prices impacting profitability

    • Increasing competition from asset-light logistics players

    • Regulatory risks (GST changes, freight policy shifts)

    Risk Assessment

    Key Risk Factors

    • Fuel Price Volatility: Direct impact on logistics cost structure

    • Economic Slowdowns: Potential weakening of freight service demand

    • Regulatory Risks: GST revisions, diesel price deregulation

    • Competitive Pressure: Tech-driven logistics disruptors pose long-term challenge

    Conclusion

    VRL Logistics remains a fundamentally strong player with steady growth, fleet expansion, and cost-efficient operations. The company shows promise through strategic asset sales, technology investments, and focus on expanding logistics networks.

    Key focus areas include fleet modernization, warehouse expansion, digital transformation, and e-commerce logistics growth. While facing challenges like fuel price volatility and regulatory risks, the company demonstrates resilience and strategic planning.

    Disclaimer

    This report is for informational purposes only and should not be considered investment advice. Investors must conduct their own due diligence or consult a professional before making investment decisions.

  • Lemon Tree Hotels Q3: 42% Profit Surge, 2500 Rooms Pipeline by FY27

    Lemon Tree Hotels – Q3 FY2025 Results Analysis

    Lemon Tree Hotels Ltd – Q3 FY2025 Results

    Value Pick Best Stock to buy today

    Stock Overview

    Market Cap: ₹11,682 Cr

    Current Price: ₹147

    52-Week High/Low: ₹162 / ₹112

    Stock P/E: 65.3

    Book Value: ₹12.8

    Dividend Yield: 0.00%

    ROCE: 11.4%

    ROE: 16.3%

    Debt: ₹2,270 Cr

    Reserves: ₹224 Cr

    Promoter Holding: 22.8%

    OPM: 48.7%

    Q3 FY2025 Financial Performance

    Revenue: ₹1,235 Cr (YoY growth: 24.2%)

    Operating Profit (EBITDA): ₹601 Cr (YoY growth: 31.5%)

    Operating Profit Margin: 48.7% (up from 46.2% in Q3 FY2024)

    Net Profit (PAT): ₹179 Cr (YoY growth: 42.6%)

    Quarterly Sales Growth: 22.4%

    Debt-to-Equity Ratio: 1.01

    Hotel Pipeline & Expansion Plans

    New Openings (FY2025-FY2027)

    • Mumbai: Aurika, Navi Mumbai, Lemon Tree Premier
    • Bangalore: Lemon Tree Premier & Red Fox
    • Goa: Aurika Beach Resort, Candolim
    • Jaipur: Lemon Tree Premier
    • Pipeline cities: Chandigarh, Pune, Chennai, Coimbatore

    Total Room Additions: ~2,500 new rooms by FY2027

    International Expansion

    • Middle East: Dubai, Abu Dhabi, Doha (under Aurika brand)
    • South Asia: Nepal, Bhutan, and Sri Lanka
    • Focus: High-end leisure travelers

    Capital Expenditure & Strategic Rationale

    Planned CapEx (FY2025-FY2027): ₹1,500 Cr

    Major Investment Areas:

    • New owned hotels in strategic locations
    • Property refurbishment
    • Technology & digital transformation
    • Sustainability initiatives

    Competitive Landscape

    Key Competitors

    • Indian Hotels (Taj, Vivanta, Ginger)
    • EIH (Oberoi, Trident)
    • Chalet Hotels & Marriott-managed properties
    • Sarovar & Radisson

    Competitive Advantages

    • Asset-light expansion model
    • Strong urban presence
    • Cost leadership in operations
    • Growing brand recognition

    Risks & Challenges

    Valuation Risk

    • P/E of 65.3x above industry average
    • EV/EBITDA at 21x indicates stretched valuation

    Debt & Financial Risk

    • ₹2,270 Cr debt burden
    • Net debt/EBITDA: 3.8x

    Market Risks

    • Cyclical nature of hotel demand
    • Potential corporate travel slowdown
    • Competitive pricing pressure

    Valuation Metrics

    EV/EBITDA (FY25E): 21x (vs industry avg of ~18x)

    Price-to-Book Ratio: 11.5x (vs sector average of 7x)

    Disclaimer: This report is for informational purposes only and does not constitute investment advice. Investors should conduct their own research before making financial decisions.

  • Rain Industries: Emerging Tech Innovator – Breakthrough Battery Materials

    Rain Industries Limited – Value Pick Dark Horse

    Rain Industries Limited

    Value Pick Dark Horse to buy for long term

    Investment Summary

    Rain Industries Limited (RAIN) reported a challenging Q3 FY2025 with significant declines in revenue and profitability. The company’s carbon and cement businesses faced headwinds from global industrial slowdowns and regional regulatory changes. However, strategic investments in alternative raw materials, energy storage, and advanced materials offer long-term growth potential.

    Given the current financials, the high leverage remains a concern, but the company is actively reducing debt. Market share expansion and operational optimizations are key near-term strategies.

    Key Financial Metrics

    • Market Cap: ₹4,901 Cr.
    • Current Price: ₹146
    • 52-Week High / Low: ₹220 / ₹130
    • Stock P/E: N/A
    • Book Value per Share: ₹211
    • Dividend Yield: 0.69%
    • ROCE: 1.90%
    • ROE: -10.2%
    • Debt: ₹8,518 Cr.
    • Reserves: ₹7,032 Cr.

    Financial Performance Highlights

    • Sales: ₹15,799 Cr.
    • Operating Profit Margin (OPM): 2.00%
    • Quarterly Sales Variation: -5.43%
    • Sales Growth (3Yrs): 20.1%
    • Profit After Tax: ₹ -1,395 Cr.
    • Debt-to-Equity Ratio: 1.21
    • Interest Coverage Ratio: 0.9x
    • Free Cash Flow (FCF): ₹285 Cr.

    Q3 FY2025 Financial & Business Performance

    Revenue and Profitability

    • Sales growth contracted -19% YoY
    • Net Loss of ₹1,395 Cr
    • ROCE at 1.90% and ROE at -10.2%
    • Gross margins fell by 200 bps YoY

    Segment Performance

    Carbon Business
    • Coal Tar Pitch (CTP) margins impacted
    • Calcined Petroleum Coke (CPC) segment faced volume pressures
    • Market recovery expected in specialty pitch and graphite electrode demand
    Cement Business
    • Impacted by rising costs and regulatory challenges
    • Government infrastructure push expected to drive demand

    Future Growth Plans & Expansions

    Operational Optimization

    • Maximize production at low-cost plants
    • Alternative feedstock usage in carbon distillation
    • Strengthening position in battery material supply chains
    • Exploring strategic joint ventures

    New Product Development

    • Energy Materials technology center in Hamilton, Canada
    • LionCoat(R) Battery-grade Carbon Precursor Materials
    • Expanding advanced carbon materials for EVs
    • Supply chain integration strategy

    Capital Expenditure & Financial Strategy

    Capex and Asset Management

    • No major new plant expansions
    • Focus on optimizing existing assets
    • Minimal capex in 2025
    • Investments in high-margin specialty products

    Debt Reduction Plan

    • $50M debt repayment scheduled for April 2025
    • $200M cash generation in 9M FY25
    • Evaluating asset sales
    • Exploring refinancing options

    Competitive Landscape & Risks

    Key Competitors

    • Carbon Products: Himadri Speciality Chemicals, Rain Carbon Inc.
    • Cement Business: UltraTech, ACC, Shree Cement
    • Battery Anode Materials: Dominated by Chinese suppliers

    Key Risks

    • High debt burden
    • Regulatory risks in India
    • Raw material volatility
    • Global economic slowdown
    • Foreign exchange risks

    Valuation & Investment Thesis

    Current Valuation

    • Current P/B Ratio: 0.69x
    • Potential undervaluation if turnaround materializes
    • Debt overhang limits near-term upside

    Investment Potential

    • Long-term growth in energy storage materials
    • Strategic positioning in specialty carbon products
    • Potential re-rating catalyst: Debt reduction
    • Operational efficiency improvements
    High-Risk, High-Reward Opportunity for Patient Investors

    Conclusion

    Rain Industries is navigating a difficult business environment with declining profitability and high leverage. However, its strategic focus on energy storage materials, specialty chemicals, and global cost optimization can drive long-term recovery. The stock presents a high-risk, high-reward opportunity for patient investors willing to endure near-term volatility.

    Disclaimer: This report is for informational purposes only. Conduct your own due diligence before making any investment decisions.

  • TARIL Q3 FY2025 Results: ₹19,000 Cr Pipeline & $1B Target

    Transformers & Rectifiers India Ltd (TARIL) – Q3 FY2025 Full Equity Research Report

    Transformers & Rectifiers India Ltd (TARIL)

    Q3 FY2025 Comprehensive Equity Research Report

    Investment Thesis

    Transformers & Rectifiers India Ltd (TARIL) is a leading manufacturer of power and industrial transformers with a strong growth trajectory, robust order book, and strategic backward integration initiatives. The company has demonstrated exceptional revenue growth of 49% YoY, driven by strong execution, rising demand for power infrastructure, and new product innovations.

    Key Performance Highlights

    Revenue Growth: 49% YoY

    Stock P/E: 75.2x

    Valuation Considerations

    Despite its impressive fundamentals, the stock trades at a high P/E of 75.2x, making it expensive relative to industry peers. Investors should assess valuation risks alongside its long-term growth potential, strong market position, and upcoming capacity expansions.

    Q3 FY2025 Financial Performance

    Standalone Results (₹ in Lakhs)

    Metric Q3 FY25 Q3 FY24 YoY Change Q2 FY25 QoQ Change
    Revenue from Operations 54,531 36,530 +49% 44,593 +22%
    EBITDA 8,696 3,677 +136% 7,565 +15%
    EBITDA Margin (%) 15.69% 10.00% +569 bps 16.53% -84 bps
    Profit After Tax (PAT) 5,055 1,344 +276% 4,218 +20%
    PAT Margin (%) 9.12% 4.00% +520 bps 9.00% +12 bps

    Consolidated Results (₹ in Lakhs)

    Metric Q3 FY25 Q3 FY24 YoY Change Q2 FY25 QoQ Change
    Revenue from Operations 55,936 36,935 +51% 46,154 +21%
    EBITDA 9,376 4,011 +134% 8,097 +16%
    EBITDA Margin (%) 16.50% 10.81% +569 bps 17.11% -61 bps
    Profit After Tax (PAT) 5,552 1,576 +252% 4,602 +21%
    PAT Margin (%) 9.77% 4.25% +552 bps 9.72% +5 bps

    Order Book Highlights

    Total Order Book: ₹3,686 Cr

    New Orders in Q3: ₹631 Cr

    Export Orders: ₹161 Cr

    Orders Under Negotiation: ₹19,000+ Cr

    Key Clients: Power Grid Corporation of India (PGCIL), State Transmission Utilities (STUs), Industrial Clients

    Growth Drivers & Expansion Plans

    Capacity Expansion Initiatives

    • Order booking for new manufacturing capacity to begin in Q4 FY25
    • New fully automated radiator manufacturing facility under approval with PGCIL
    • Expansion to support revenue target of $1 billion within 3 years

    Backward Integration & Cost Efficiency

    • Acquisition of Posco Poggenamp Electrical Steel Ltd., a CRGO processing unit
    • Ensuring 100% in-house sourcing of core raw materials
    • Technology agreements for 3 critical components to be operational by December 2025
    • CRGO contributes 30-35% of total raw material cost, improving cost control

    New Product Development & Technological Advancements

    Electric Arc Furnace Transformers

    Successfully exported 220/253 MVA EAF Transformer, among the highest rated globally

    Green Energy & Grid Stability Products

    • STATCOM Transformers (193 MVA single-phase) to enhance grid efficiency
    • Green Hydrogen & Solar Application Transformers for renewable projects
    • Mobile Substations catering to emergency power needs

    Competitive Landscape

    TARIL is the 2nd largest transformer manufacturer in India by installed capacity (40,000 MVA)

    Competitor Market Position Key Strengths
    Siemens India Large MNC, diversified Technology leadership, strong global presence
    CG Power Large domestic player High-voltage transformer expertise
    Hitachi Energy (ABB) Strong industrial focus Global technology partnerships
    Bharat Bijlee Niche player Specialty transformers for railways

    TARIL differentiates itself through in-house CRGO steel processing, high-end testing infrastructure, and specialized power solutions.

    Financial Metrics & Valuation

    Key Financial Indicators

    Market Cap: ₹12,037 Cr

    Current Price: ₹802

    52-Week High/Low: ₹1,300 / ₹275

    Stock P/E: 75.2x (Expensive)

    Additional Financial Metrics

    Book Value: ₹73.5

    ROCE: 14.8%

    ROE: 9.33%

    Debt: ₹244 Cr

    Reserves: ₹1,088 Cr

    Growth Performance

    Dividend Yield: 0.02%

    3-Year Sales Growth:

    Key Takeaways

    Revenue Growth

    49% YoY

    Order Pipeline

    ₹19,000+ Cr

    Target Revenue

    $1 Billion

    Disclaimer: This report is for informational purposes only and does not constitute investment advice. Please consult a financial advisor before making investment decisions.

  • GRSE Q3 FY2025: Defense Shipbuilder Multibagger

    GRSE (Garden Reach Shipbuilders) Q3 FY2025 Results

    Garden Reach Shipbuilders & Engineers Ltd. (GRSE) – Q3 FY2025

    Value Pick Multibagger Stock to buy

    1. Company Overview

    Garden Reach Shipbuilders & Engineers Ltd. (GRSE) is one of India’s premier defense public sector shipyards under the Ministry of Defence. With a legacy of over six decades, GRSE has built over 100 warships and numerous commercial vessels. The company is a key supplier to the Indian Navy, Indian Coast Guard, and foreign naval forces. GRSE also manufactures deck machinery, engineering equipment, and pre-fabricated bridges.

    2. Q3 FY2025 Financial Performance

    Metric Q3 FY2025 Q3 FY2024 YoY Growth
    Revenue from Operations (₹ Cr.) 1,271.00 923.09 +37.7%
    Total Income (₹ Cr.) 1,343.12 1,004.61 +33.7%
    EBITDA (₹ Cr.) 151.02 126.47 +19.4%
    EBITDA Margin (%) 11.9% 12.6% -70 bps
    Profit Before Tax (₹ Cr.) 133.76 118.67 +12.7%
    Profit After Tax (₹ Cr.) 98.18 88.25 +11.3%
    EPS (₹) 8.57 7.70 +11.3%

    Revenue Growth: The revenue jump is attributed to the strong execution of defense shipbuilding contracts.

    Profitability: Despite a 37.7% YoY sales growth, net profit grew only 11.3%, indicating margin pressure due to increased raw material costs and subcontracting expenses.

    3. Key Financial Ratios

    Metric Value Industry Average
    ROCE 27.4% 18-20%
    ROE 22.2% 15-17%
    Debt/Equity Ratio 0.004 0.2-0.5
    Net Profit Margin 8.25% 10-12%
    Current Ratio 1.16 1.3-1.5
    Key Takeaway: GRSE’s high ROCE and ROE reflect its capital efficiency, but margins are under slight pressure.

    4. Future Growth Plans & Expansion Strategy

    1. Order Book Strength & New Contracts

    GRSE’s current order book stands at ₹25,000+ Cr., providing multi-year revenue visibility.

    Major Projects Include:

    • Frigate and Corvette projects for the Indian Navy
    • Survey vessels and landing craft utility ships for the Indian Coast Guard
    • Potential exports to friendly nations under the “Make in India” initiative

    2. Expansion of Shipbuilding Capabilities

    Capex Plan: ₹500-600 Cr. over the next three years to expand capacity and improve efficiency.

    Strategic Objectives:

    • Automation of shipbuilding yards to reduce construction time
    • Enhanced R&D investments to develop indigenous ship designs
    • Green Energy Initiatives in manufacturing to improve sustainability

    3. Focus on Non-Defense Business

    GRSE is diversifying into commercial shipbuilding to reduce reliance on defense contracts. Targets include inland water transport vessels, tugs, and ferries for global markets.

    5. Capital Expenditure & Strategic Rationale

    Capex Component Investment (₹ Cr.) Expected Benefit
    Modernization of shipyards 350 Faster shipbuilding
    Automation & AI integration 150 Reduce costs
    R&D & indigenous ship design 100 Competitive edge
    Why It Matters: This expansion will increase shipbuilding efficiency, reduce dependency on imported components, and support future defense contracts.

    6. Competitive Landscape

    Company Market Cap (₹ Cr.) P/E ROCE ROE Dividend Yield
    Garden Reach Shipbuilders 17,268 43.7 27.4% 22.2% 0.62%
    Cochin Shipyard 27,542 35.3 22.5% 18.7% 1.1%
    Mazagon Dock Shipbuilders 59,000 28.2 34.5% 26.8% 0.5%

    Takeaway:

    • GRSE has a strong ROCE and ROE, but trades at a premium valuation compared to peers like Cochin Shipyard
    • Mazagon Dock has a larger market share but GRSE is catching up with strong revenue growth

    7. Risk Assessment

    Execution Delays Potential cost overruns in large projects
    Raw Material Costs Higher steel and component prices may squeeze margins
    Geopolitical Risks Dependence on government contracts makes it vulnerable to policy shifts
    Mitigation: GRSE’s diversification and capex in efficiency improvements should reduce cost risks.

    8. Valuation Analysis

    Market Cap (₹ Cr.) 17,268
    Current Price (₹) 1,508
    52W High / Low (₹) 2,835 / 673
    P/E Ratio 43.7
    Book Value (₹) 161
    ROCE 27.4%
    ROE 22.2%
    Debt ₹9.59 Cr.
    Dividend Yield (%) 0.62%

    The current P/E of 43.7x is higher than industry peers, suggesting the stock is priced for strong future growth.

    If we assume a 25% earnings CAGR for the next 2 years, a fair forward P/E of 35x indicates potential for continued valuation support.

    Investment Thesis

    ✅ Strong Order Book & Execution Capabilities

    ✅ Debt-Free & High ROCE/ROE Metrics

    ✅ Robust Capex Plan for Future Growth

    🚨 Recommended: Accumulate on Market Dips

    9. Conclusion

    Near-Term View

    The stock is trading at a high valuation, making it vulnerable to short-term corrections. Best accumulated on market dips.

    Long-Term View

    With a strong order book and expansion strategy, GRSE is a solid long-term play on India’s naval defense modernization.

    Disclaimer: This report is for informational purposes only and does not constitute investment advice. Please consult a financial advisor before making investment decisions.

  • Olectra Greentech: 107.8% PAT Growth,₹500Cr Expansion Plans

    Olectra Greentech Limited – Q3 FY25 Results

    Olectra Greentech Limited Q3 FY2025 Results

    Value Pick Best stock to buy

    NSE: OLECTRA | BSE: 532439

    Sector: Electric Vehicles & Polymer Insulators

    Key Financial Metrics

    Market Cap

    ₹11,919 Cr

    Book Value

    ₹120

    ROCE

    14.8%

    ROE

    8.77%

    Debt

    ₹187 Cr

    Reserves

    ₹949 Cr

    Sales Growth (3Y CAGR)

    60.1%

    Profit Growth (3Y CAGR)

    112%

    Q3 FY2025 Performance Analysis

    Financial Performance (Standalone)

    • Revenue: ₹50,683.45 Lakh (YoY growth: 52.7%)
    • EBITDA Margin: 14.5%
    • PAT: ₹4,630.57 Lakh (YoY growth: 107.8%)
    • EPS: ₹5.64 (vs ₹2.71 YoY)
    • Net Profit Margin: 9.1%

    Business Segments

    Electric Vehicles Division

    • Q3 Revenue: ₹45,977.93 Lakh (90.7% of total)
    • YoY Growth: 55.4%
    • Profit Before Tax & Interest: ₹5,926.52 Lakh

    Growth Drivers

    • Expansion in public electric transport sector
    • Government-backed FAME-II tenders
    • Strategic partnerships with BYD and EVEY Trans

    Insulator Division

    • Q3 Revenue: ₹4,705.52 Lakh (9.3% of total)
    • YoY Growth: 30.5%
    • Profit Before Tax & Interest: ₹1,224.35 Lakh

    Growth Drivers

    • Growing power transmission infrastructure demand
    • Expansion in domestic and export markets
    • Steady cash flow with higher margins

    Growth Plans & Expansion Strategy

    Manufacturing Expansion

    • New EV manufacturing facility development
    • Battery technology localization initiatives
    • Capex: ₹300-500 Cr investment plan
    • Expansion of charging infrastructure

    Product Development

    • Electric trucks launch planning
    • Battery-integrated electric vehicles
    • Hydrogen fuel cell technology exploration
    • R&D focus on indigenous technology

    Financial Health & Capital Structure

    • Debt-to-Equity Ratio: 0.19x
    • Interest Coverage Ratio: Strong position with robust cash flows
    • Working Capital Management: Efficient inventory and receivables
    • Cash Reserves: Adequate for planned expansion

    Competitive Analysis

    Market Position

    • Leading player in electric bus segment
    • Strong R&D capabilities with BYD partnership
    • Established presence in state-run electric bus projects
    • Growing market share in insulator segment

    Industry Challenges

    • Raw material price volatility
    • Global supply chain disruptions
    • Increased competition in EV segment
    • Policy implementation dependencies

    Disclaimer: This research report is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence before making investment decisions.

    Date: February 2025

  • Anant Raj Q3FY25 Results: 54.6% PAT Growth, ₹1000Cr Expansion Plan

    Anant Raj Limited – Q3 FY2025 Results

    Anant Raj Limited

    Value Pick Multibagger stock for long term

    Q3 FY2025 Results

    Stock Overview

    Market Cap ₹21,834 Cr
    Current Price ₹638
    52-Week High/Low ₹948 / ₹281
    Stock P/E 56.7x
    Book Value per Share ₹112

    Key Financial Metrics

    Dividend Yield 0.11%
    ROCE 8.56%
    ROE 8.05%
    Debt ₹386 Cr
    Reserves ₹3,759 Cr

    Q3 FY2025 Financial Results

    Particulars Q3 FY2025 Q3 FY2024 % Change YoY
    Revenue from Operations ₹534.64 Cr ₹392.27 Cr +36.3%
    Total Income ₹543.97 Cr ₹401.02 Cr +35.7%
    EBITDA ₹123.50 Cr ₹93.44 Cr +32.1%
    EBITDA Margin 23.1% 23.8% Stable
    Profit Before Tax (PBT) ₹131.75 Cr ₹86.30 Cr +52.7%
    Net Profit (PAT) ₹110.37 Cr ₹71.43 Cr +54.6%
    Earnings Per Share (EPS) ₹3.23 ₹2.22 +45.5%

    Key Q3 FY2025 Highlights

    • Revenue grew by 36.3% YoY, driven by strong sales in luxury residential and commercial projects
    • Net Profit surged by 54.6%, reflecting operational efficiencies
    • Debt remains low at ₹386 Cr, ensuring a strong balance sheet
    • EPS growth of 45.5%, indicating rising shareholder value

    Business & Expansion Strategy

    Residential Segment

    • Launch of new luxury residential projects in Gurugram, Noida, and Manesar
    • Targeting HNIs with premium apartments and villas
    • Strengthening presence in Delhi NCR, Bangalore, and Pune

    Commercial & IT Parks

    • Expansion of Anant Raj IT Park in Manesar
    • Development of Grade A office spaces
    • Flexible co-working infrastructure

    Hospitality & Retail

    • Entering luxury hospitality segment
    • High-end serviced apartments and hotels
    • Expansion of retail spaces

    Affordable Housing

    • New focus on affordable housing projects
    • Mid-segment housing expansion
    • Capturing India’s urbanization trends

    Capital Expenditure & Strategic Investments

    Capex Plan (FY2025-FY2027): ₹1,000 Cr+

    Land Acquisitions ₹500 Cr
    IT Park Expansion ₹300 Cr
    Infrastructure Development ₹200 Cr

    Strategic Financial Moves

    • NCD Repayment: ₹103.75 Cr in Q3 FY2025
    • Convertible Warrants: ₹99.99 Cr raised via preferential issue at ₹730/share

    Competitive Landscape & Industry Outlook

    Company Market Cap (₹ Cr.) Revenue (₹ Cr.) P/E Ratio ROE (%)
    Anant Raj Ltd ₹21,834 ₹1,962 56.7x 8.05%
    DLF Ltd ₹1,63,000 ₹7,800 62.3x 11.2%
    Godrej Properties ₹66,500 ₹4,200 55.5x 9.4%
    Prestige Estates ₹41,700 ₹7,150 38.8x 13.5%

    Industry Overview

    • Real estate demand remains strong, fueled by urbanization and infrastructure growth
    • Luxury housing segment is booming, driven by HNI and NRI investments
    • Commercial real estate demand is increasing, especially in IT hubs

    Competitive Analysis

    • Anant Raj trades at a lower P/E than DLF and Godrej Properties
    • ROE is lower than competitors but showing improvement potential
    • Revenue growth outpacing most peers

    Financial Projections (FY2025-FY2027)

    Metric FY2025E FY2026E FY2027E
    Revenue (₹ Cr) 2,150 2,700 3,200
    EBITDA Margin 24.0% 25.5% 26.0%
    Net Profit (₹ Cr) 430 525 630
    EPS (₹) 13.5 16.4 19.8
    ROE (%) 9.2% 10.8% 12.1%

    Growth Drivers

    • Expansion into luxury residential & IT parks
    • Higher rental income from commercial real estate
    • Margin improvement from premium projects

    Valuation & Investment Thesis

    Current Valuation Metrics

    Stock P/E 56.7x
    Price-to-Book (P/B) 5.7x

    Valuation Estimate (FY2026)

    Projected EPS ₹16.4
    Industry Avg. P/E ~50x
    Target Price ₹820
    Potential Upside 29%

    Investment Rationale

    Why Invest in Anant Raj Ltd?

    • High Revenue & Profit Growth – 48.5% YoY sales growth & 67.4% profit growth
    • Expanding Asset Base – IT parks, commercial & luxury housing
    • Debt Under Control – ₹386 Cr total debt, NCD repayments underway
    • Valuation Upside – Estimated price target of ₹820 (~29% upside)

    Risk Assessment

    Key Risk Factors

    • 🚨 Market Risks: Potential slowdowns in real estate demand due to macroeconomic factors
    • 🚨 Regulatory Risks: Land acquisition and RERA compliance could impact project timelines
    • 🚨 Interest Rate Risks: Rising borrowing costs could pressure profit margins

    Disclaimer: This report is not investment advice. Investors should conduct their own research before making investment decisions.

  • Dabur Q3 FY25: 19% global Growth Ayurveda Expansion

    Dabur India Limited – Q3 FY2025 Results

    Dabur India Limited -Q3 FY2025 Results

    Value Pick Best Stock for long term investment

    Market Metrics

    Market Cap: ₹95,627 Cr

    Current Price: ₹539

    52W High/Low: ₹672 / 489

    Key Ratios

    P/E: 54.1

    Book Value: ₹58.5

    Dividend Yield: 1.02%

    Returns & Growth

    ROCE: 22.3%

    ROE: 19.2%

    Sales Growth (3Yrs): 9.06%

    Financial Position

    Debt: ₹1,752 Cr

    Reserves: ₹10,185 Cr

    Promoter Holding: 66.3%

    Q3 FY2025 Performance Overview

    Metric Q3 FY25 Q3 FY24 YoY Growth
    Revenue from Operations ₹3,355 Cr ₹3,255 Cr +3.1%
    Operating Profit ₹682 Cr ₹668 Cr +2.1%
    Operating Margin 20.3% 20.5% -20 bps
    Net Profit ₹522 Cr ₹514 Cr +1.6%
    A&P Spend 6.8% 7.5% -70 bps

    Segment Performance Analysis

    Domestic Business (₹2,448 Cr, +1.4% YoY)

    Foods & Beverages (48.2% of Sales)

    • Revenue: ₹1,110 Cr
    • Growth: +30% YoY
    • Strong performance in Hommade & Badshah spices
    • Beverages segment declined 10.3% due to weak festive demand

    Healthcare (37.9% of Sales)

    • Revenue: ₹872 Cr
    • Health supplements declined 3.4%
    • Chyawanprash maintained market leadership
    • OTC & Ethical category remained flat

    Home & Personal Care (11.8% of Sales)

    • Revenue: ₹273 Cr
    • Home Care: -10.3% YoY
    • Personal Care: +2.7% YoY
    • Market share gains in Oral Care

    International Business (25% of Sales)

    • Revenue: ₹847 Cr (+18.9% CC Growth)
    • Egypt: +54.6% growth
    • Turkey: +28.2% growth
    • Bangladesh: +21.6% growth
    • MENA market: +17.5% growth

    Strategic Initiatives & Capex Plans

    Capital Expenditure

    • Expansion of Badshah spices production capacity
    • Investment in Ayurvedic product portfolio
    • Modernization of manufacturing facilities

    Branding Efforts

    • Rural activation programs
    • Festival season campaigns (Kumbh Mela, Durga Puja)
    • Celebrity endorsements and digital marketing

    Market Penetration Strategy

    • Focus on premium healthcare segments
    • Expansion of ayurvedic product range
    • Strengthening rural distribution network

    Competitive Landscape & Risks

    Key Competitors

    • Hindustan Unilever (HUL)
    • ITC Limited
    • Marico

    Risk Factors

    • Inflationary pressures on raw materials
    • Increased competitive pricing pressure
    • Unpredictable weather impacting seasonal products
    • Currency fluctuations in international markets

    Valuation & Investment Thesis

    Current Valuation Metrics

    Metric Value Industry Avg
    P/E Ratio 54.1x ~45x
    Price/Book 9.2x ~8x
    Dividend Yield 1.02% ~1.5%

    Growth Projections

    • Sales CAGR (3-5 Years): 8-10%
    • PAT CAGR (3-5 Years): 6-8%
    • Target Price (1 Year): ₹590-₹610

    Investment Recommendation

    Long-Term Buy Recommendation

    • Strong brand moat and rural resilience
    • Stable FMCG exposure with defensive characteristics
    • Premium valuation justified by market leadership
    • Robust international growth prospects

    Near-Term Considerations

    • Current P/E of 54.1x above historical averages
    • Moderate earnings growth trajectory
    • Margin pressures from input costs
    • Competitive intensity in key segments

    Growth Drivers & Future Outlook

    Key Growth Catalysts

    • Rising demand for Ayurvedic & natural products
    • Expanding rural reach and distribution
    • Premiumization in healthcare & spices categories
    • Strong international market expansion

    Digital Initiatives

    • E-commerce channel optimization
    • Direct-to-consumer (D2C) platforms
    • Digital-first product launches
    • Enhanced online customer engagement

    Financial Projections

    Metric FY2025E FY2026E
    Revenue Growth 8-10% 10-12%
    EBITDA Margin 20-21% 21-22%
    PAT Growth 6-8% 8-10%

    Management Commentary & Strategic Focus

    Key Strategic Priorities

    • Portfolio premiumization and innovation
    • Cost optimization and efficiency initiatives
    • Market share gains in core categories
    • International business expansion

    Innovation Pipeline

    • New product launches in premium Ayurvedic segment
    • Extension of Badshah spices portfolio
    • Enhanced health supplements range
    • Modern format personal care products

    Technical Analysis

    Price Trends

    • Current Price: ₹539
    • 52-Week Range: ₹489 – ₹672
    • 200-Day Moving Average: ₹545
    • Support Levels: ₹520, ₹500
    • Resistance Levels: ₹560, ₹580

    Conclusion

    Dabur India continues to demonstrate resilience in a challenging market environment, supported by its strong brand portfolio and diversified presence across categories. The company’s focus on premium segments, rural expansion, and international growth presents significant opportunities for long-term value creation.

    Key Investment Considerations

    • Strong brand equity in natural and Ayurvedic segments
    • Robust international business growth
    • Premium valuation reflecting market leadership
    • Potential for margin expansion through premiumization

    Disclaimer: This report is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult with financial advisors before making investment decisions. Past performance is not indicative of future returns. The information contained herein is believed to be reliable but cannot be guaranteed for completeness or accuracy.

  • AXISCADES Q3FY25: 95% PAT Growth, ₹3000Cr Defense Tech Expansion Plan

    AXISCADES Technologies Limited – Q3 FY2025 Value Pick

    AXISCADES Technologies Limited – Q3 FY2025 Results

    Value Pick Multibagger stock for long term

    Company Overview

    AXISCADES Technologies Limited is a leading technology enabler in Aerospace, Defence, and Electronics, Semiconductor & AI (ESAI). The company is shifting from a service-based model to a product-driven, non-linear growth strategy to enhance margins and scalability.

    Q3 FY2025 Financial Performance

    Revenue

    ₹274 Cr

    YoY +18.4% QoQ +3.7%

    EBITDA

    ₹40 Cr

    YoY +36.9% QoQ +21.7%

    PAT

    ₹14.8 Cr

    YoY +95.9% QoQ +20.7%

    EBITDA Margin

    14.6%

    vs 12.4% in Q2 FY25

    Key Drivers

    Core Segments (72% of revenue): Grew 33% YoY
    • Defence: +88% YoY
    • Aerospace: +11% YoY
    Non-core segments: Declined -11% YoY

    Future Growth Plans & Planned Expansions

    Strategic Infrastructure Investments

    ESAI Hub

    180,000 sq. ft. near BIAL

    June 2025 completion

    Unmanned Warfare Centre

    Electronic City, Bangalore

    June 2025 completion

    Defence & Aerospace Cluster

    20.7 Acres near KIADB Aerospace SEZ

    Product & Business Strategy

    • Aerospace: AI-enabled MRO, aircraft interiors, and power-by-hour logistics
    • Defence: Investments in radar integration, unmanned warfare, and AI-enabled RF systems
    • ESAI: Expansion in post-silicon chip design, AI/SLM devices, and Edge Data Centres

    Management Targets

    50% revenue growth in core domains in FY26
    300 bps EBITDA margin expansion
    Transition to product-driven model

    Competitive Landscape & Key Risks

    Competitive Advantages

    • Strong Aerospace & Defence expertise (6,000+ man-years)
    • Strategic foreign partnerships
    • High-margin, product-driven shift

    Risks

    ⚠ Execution Risk – Large infrastructure projects may face delays
    ⚠ Foreign Dependency – Heavily reliant on global A&D contracts
    ⚠ Capital Allocation – ₹255 Cr debt; over-leverage risk

    Financial & Valuation Analysis

    Market Cap

    ₹3,021 Cr

    Stock P/E

    56.3x

    Premium vs peers

    Book Value

    ₹143

    P/B Ratio: 5.0x

    Returns

    ROCE: 13.8%

    ROE: 7.11%

    Valuation Perspective

    • High growth visibility with strong Defence & Aerospace tailwinds
    • Strong EBITDA growth supports long-term expansion
    • Premium valuation demands consistent earnings execution

    Fair Value Estimate: ₹680 – ₹720 (based on forward P/E of 40x FY26E EPS)

    Investment Thesis

    Positive Factors

    • Strong core segment growth (+33% YoY in Q3 FY25)
    • Large capex plans drive long-term value
    • Improving margins & product-driven shift

    Investment View

    Moderate Buy for long-term investors, but watch execution risks.

    This report is for informational purposes only and does not constitute investment advice. Investors should perform their own due diligence before making any financial decisions.