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

Tag: cheap stocks

  • Hindware’s 20-Year Growth Plan: From ₹211 to ₹2,500+ Stock Price Projection | Q3 Analysis

    Hindware Home Innovation Ltd (Somany) – Q3 FY2025 Stock Analysis | Investment Research

    Somany Home Innovations Ltd (Hindware Home Innovation Ltd)

    Q3 FY2025 Stock Research Report
    Published: February 27, 2025

    Company Overview

    Hindware Home Innovation Ltd (NSE: HINDWAREAP, BSE: 542905) is a leading player in the Indian bathware, sanitaryware, consumer appliances, and plastic pipes industries. The company operates under multiple brands, including Hindware, Queo (premium bathware), and Truflo (pipes).

    Key Financial Metrics

    Market Cap
    ₹1,765 Cr
    Current Price
    ₹211
    52W High / Low
    ₹463 / ₹177
    Book Value
    ₹68.8
    Stock P/E
    N/A
    Dividend Yield
    0.19%
    ROCE
    9.50%
    ROE
    4.38%
    Face Value
    ₹2.00
    Debt
    ₹1,051 Cr
    Reserves
    ₹561 Cr
    Sales
    ₹2,596 Cr
    OPM
    6.79%
    Qtr Sales Growth
    -14.2%
    3-Yr Sales Growth
    16.4%
    3-Yr Profit Growth
    -22.4%
    Promoter Holding
    52.5% (+1.22%)

    Q3 FY2025 Financial Performance

    Consolidated Revenue: ₹594 Cr (YoY decline due to subdued demand)

    EBITDA: ₹37 Cr (lower due to rising input costs and weak market conditions)

    Profit After Tax (PAT): ₹-22.3 Cr (significant loss)

    Bathware

    Revenue: ₹338 Cr

    EBITDA: ₹35 Cr

    Pipes (Truflo)

    Revenue: ₹189 Cr

    EBITDA: ₹13 Cr

    Consumer Appliances

    Revenue: ₹67 Cr

    EBITDA: ₹-10 Cr (loss)

    Key Challenges

    • Declining sales growth across all segments
    • Loss of market share in the bathware division
    • Negative profit growth (-144%) due to rising costs and weak demand
    • High debt burden of ₹1,051 Cr, impacting financial flexibility

    Growth Plans & Strategic Initiatives

    Bathware Segment

    Market Positioning & Distribution:
    • Strengthening dealer and distributor relationships
    • Expanding premium segment (Queo) through brand stores and e-commerce
    • Targeting high-potential, low-market-share regions, especially in Western India
    Product & Innovation:
    • Focus on smart, intelligent, and high-margin products
    • New R&D initiatives for premium faucets and sanitaryware
    Operational Efficiency & Cost Optimization:
    • Zero-based budgeting to reduce costs across supply chain and marketing
    • Elimination of low-margin products
    • Enhanced plumber loyalty and influencer engagement programs

    Pipes (Truflo) Business

    • 11% YoY volume growth despite weak pricing environment
    • Expanding capacity with Roorkee plant (Uttarakhand) opening in Q1 FY26, adding ₹250 Cr revenue potential
    • New products: Foam core pipes, Double Wall Corrugated pipes, fire sprinkler systems

    Consumer Appliances Business

    • Restructuring focus on kitchen appliances (chimneys, hobs, cooktops) and heating products (water heaters)
    • Exit from loss-making categories like fans, reducing SKU complexity
    • Expecting quarterly EBITDA improvements from FY26

    Future Financial Projections & Expected Returns

    Time Frame Projected Stock Price (₹) CAGR Estimate Key Growth Drivers
    5 Years (2030) ₹400 – ₹500 12%-15% Recovery in bathware, expansion in premium segment, Roorkee plant revenue boost
    10 Years (2035) ₹800 – ₹1,000 15%-18% Market leadership regained, strong pipe business, profitable appliances segment
    15 Years (2040) ₹1,500+ 18%-20% Dominance in bathware & pipes, sustained ROCE > 15%
    20 Years (2045) ₹2,500+ 20%-22% Fully established as a multi-category home solutions leader

    Competitive Landscape

    Peers: Cera Sanitaryware, Kajaria, Supreme Industries, Finolex Pipes

    Key Threats:

    Intense competition from Cera and international brands in premium bathware
    Declining brand loyalty in mid-premium sanitaryware
    Unstable raw material pricing affecting pipe margins
    Debt burden and financial stress

    Valuation & Investment Thesis

    Current P/E not meaningful due to losses; industry peers trade at P/E of 25-30x

    EV/EBITDA at ~15x, suggesting moderate undervaluation

    Debt-to-EBITDA high at ~7.9x; requires better cash flow generation

    Investment Rationale:

    • Near-term challenges persist, but strategic steps are being taken for market share recovery
    • Long-term upside from premiumization, cost control, and expansion in pipes
    • Attractive risk-reward for a 5-10 year horizon, especially if turnaround materializes

    Buy, Hold, or Sell?

    ✅
    Long-term investors with a 5+ year horizon can consider accumulating at ₹200-220 levels
    🚨
    Short-term investors should wait for EBITDA margin expansion before entering
    ❌
    High-risk investors should avoid due to debt concerns and negative profit growth
    Disclaimer: This report is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with a certified financial advisor before making investment decisions.
    © 2025 Value Pick Research Team | Stock Analysis & Research Report

  • Motherson Sumi Wiring India Limited Q3 FY2025 Results Report: Growth, Expansion & Valuation Analysis

    Q3 FY2025 Results & Growth Outlook



    Company Overview

    Motherson Sumi Wiring India Limited (MSWIL) is a leading automotive wiring systems supplier with a robust market position, serving marquee OEMs such as Maruti Suzuki, Mahindra, and Tata Motors. The company has demonstrated resilient performance in a competitive industry, underpinned by a strong product mix and strategic expansion initiatives.

    Q3 FY2025 Performance Highlights

    Revenue & Growth:
    Q3 FY25 consolidated revenue reached ₹2,300 Cr, with ex-greenfield operations at ₹2,220 Cr—a reflection of a 9% overall YoY growth that outpaces the industry’s ~6% volume increase.

    Profitability:
    EBITDA for ex-greenfield operations improved to ₹278 Cr (up from ₹238 Cr YoY), while PAT rose to ₹172 Cr from ₹140 Cr, demonstrating stable core margins despite the inclusion of greenfield startup costs.

    Operational Efficiency:
    Improved cost and product mix dynamics have helped maintain stable profitability in existing plants even as new capacity is added.

    Future Growth Plans & Planned Expansions

    Greenfield Projects:
    MSWIL is executing three greenfield projects strategically located in Pune, Navagam, and Kharkhoda to support new programs in both EV and ICE segments.

    Planned SOPs:Pune:
    EV+ICE expected in Q2 FY25; EV in Q4 FY25.
    Navagam: EV slated for Q1 FY26* and EV+ICE by Q2 FY26.
    Kharkhoda: ICE operations expected to commence in Q2 FY26.
    These projects are forecast to contribute approximately ₹2,100 Cr of annual revenue by H2 FY26, underpinning long-term growth.

    New Product Launches:The company is gearing up to introduce a slew of new products across both electric and traditional powertrains, reinforcing its status as a preferred supplier for next-generation vehicles.

    Strategic Rationale:The substantial capital expenditure (CAPEX) directed towards these greenfields is aimed at scaling production capacity and capturing market share in the evolving automotive landscape.
    Although associated startup costs are expensed upfront, full operational ramp-up is expected in subsequent quarters, which will enhance revenue and margins.

    Capital Expenditure & Strategic Rationale

    Investment in Capacity:
    The greenfield projects represent a calculated CAPEX investment, designed to secure future revenue streams and align with the industry’s transition toward electric mobility.
    This strategy ensures that MSWIL remains competitive, with state-of-the-art facilities capable of supporting both EV and ICE platforms.

    Cost Management:
    Despite the upfront expense of greenfield startup costs, management’s focus on improving operational efficiencies in existing plants and cost-sharing discussions with customers is expected to mitigate margin pressures.

    Competitive Landscape & Inherent Risks

    Industry Position:
    MSWIL operates in a highly competitive market where cyclical OEM demand and raw material costs (e.g., copper) can impact margins.
    Risks:Execution Risk: Potential delays in project ramp-ups (noted in the Navagam plant SOP delay) could postpone revenue realization.
    Cost Fluctuations: Volatility in copper prices may affect input costs, though recent stabilization is a positive sign.
    Market Cyclicality: Dependence on OEM cycles and broader automotive demand remains an inherent risk.
    Mitigants:Strong customer relationships, a near debt-free balance sheet, and strategic cost-sharing initiatives help cushion these risks.

    Valuation & Investment Thesis

    Key Metrics:Market Cap:     ₹21,960 Cr.
    Current Price: ₹49.7 (High/Low: ₹80.0 / ₹47.6).
    Stock P/E: 34.7; Book Value: ₹3.66; Dividend Yield: 1.61%.
    Profitability: ROCE of 48.0% and ROE of 42.4%.
    Balance Sheet: Debt of ₹282 Cr. versus Reserves of ₹1,175 Cr.; Promoter holding at 61.7%.

    Growth Trends: Sales at ₹9,043 Cr., with sales growth at 13.7% and profit growth at 8.03% (three-year sales growth of 28.4% and profit variation of 17.3%).

    Valuation Estimate:While a P/E of 34.7 suggests a premium valuation reflective of high growth expectations, the greenfield initiatives and improved operational efficiencies support a potential re-rating.
    Our analysis indicates a target price in the range of ₹60-65, assuming timely execution and margin expansion from new capacity.

    Investment Thesis:Strengths: MSWIL boasts strong financials, operational efficiency, and a strategic expansion plan that taps into both EV and ICE growth opportunities.

    Outlook: With robust customer ties, disciplined CAPEX, and favorable industry tailwinds, the company is well-poised for long-term growth despite short-term execution risks.

    Risk/Reward: The potential upside from the greenfield projects outweighs inherent risks, positioning MSWIL as an attractive growth-oriented stock within the automotive supplier space.

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

  • Asian Paints Q2 Analysis: 16.4% EBITDA Amid 6.7% Revenue Decline

    Asian Paints Ltd. – Best Share to buy today

    Asian Paints Ltd.

    Best Share to buy today.

    Ticker: ASIANPAINT Market Cap: ₹2,22,606 Cr. Current Price: ₹2,321

    Executive Summary

    Asian Paints Ltd., India’s largest and most iconic paint manufacturer, faces short-term challenges from muted consumer demand, margin pressures due to input cost inflation, and competitive intensity. However, its strong brand equity, strategic expansions, focus on innovation, and diversified product portfolio position it for sustainable long-term growth. The company’s ongoing backward integration and new growth verticals in home décor further solidify its trajectory as a market leader.

    Financial Performance Highlights (Q2 FY2025)

    Revenue: ₹8,256 Cr. (down 6.7% YoY)

    EBITDA Margin: 16.4% (↓ 530 bps YoY)

    PAT: ₹4,698 Cr. (down 7.52% YoY)

    Gross Margin: ↓ 280 bps YoY due to inflationary pressures

    H1 FY2025 Performance

    Volume Growth: 3.3%

    Value Decline: 4.8%

    EBITDA Margin: 18.5%

    Key Strategic Insights and Growth Drivers

    1. Product Innovation and Portfolio Expansion

    New Launches:

    • NeoBharat Range: Targeted at the bottom-of-the-pyramid segment
    • Ultima Protek: Incorporates cutting-edge graphene technology
    • Chroma Cosm: World’s largest color repository with 5,300 shades

    Revenue Contribution from New Products: 12% of total revenue

    2. Focus on Backward Integration

    • Dahej Plant (VAM-VAE): Reducing dependency on raw material imports
    • White Cement Unit (Fujairah): Supports diversification into high-margin products

    3. Rural and Urban Penetration

    Expanded retail touchpoints to 1.67 lakh outlets, with significant growth in Tier 3/4 towns and rural regions.

    4. Leadership in Home Décor

    Kitchen Segment: 9% growth in Q2 FY2025

    Bath Segment: 6% H1 growth

    5. Industrial Business Performance

    Segment Contribution: 6-7% of total revenue

    Q2 Growth: ~6%

    H1 Growth: ~8%

    Competitive Landscape and Market Dynamics

    Competitive Pressure

    Berger Paints gaining market share with rural focus

    New entrants offering competitive dealer margins

    Market Share Insights

    Leadership position maintained despite challenges

    Industrial segment contribution at ~6% vs competitors’ 20%-45%

    Valuation Analysis

    Current Metrics

    P/E Ratio: 47.4x

    ROE: 31.4%

    ROCE: 37.5%

    Dividend Yield: 1.43%

    DCF Valuation Assumptions

    • Volume growth: 8%-10% CAGR (5-year forecast)
    • EBITDA margin: 18%-20% post-H2 FY2025
    • WACC: 11%
    • Terminal growth rate: 4%

    Inherent Risks

    1. Macroeconomic Risks

    • Prolonged consumer demand weakness
    • Rural spending volatility

    2. Raw Material Costs

    • Crude oil derivatives dependency
    • Geopolitical impact on input costs

    3. International Operations

    • Forex losses (₹56 Cr. in Ethiopia)
    • Performance concerns in key markets

    Investment Recommendation

    Rating: Hold

    Target Price: ₹2,700–₹2,950

    Potential Upside: 16%-27% from current levels

    Asian Paints offers a robust long-term growth story backed by innovation, market leadership, and diversification. However, near-term pressures from weak demand, rising competition, and margin contraction warrant a cautious stance.

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

  • Choice International’s Future Growth Soars with SEBI Approval for Mutual Fund Launch

    Choice International Limited – Equity Research Report

    Choice International Limited

    Value Pick : Best stock to buy today : India’s leading financial services conglomerate

    Executive Summary

    Choice International Limited (Choice) has emerged as a leading financial services conglomerate in India with diversified operations spanning stock broking, insurance distribution, MSME lending, and government advisory services. The company’s robust financial performance, expanding market presence, and investment in technology-driven solutions position it well for sustainable long-term growth.

    ₹10,975 Cr
    Market Capitalization
    ₹550
    Current Price
    71.6
    P/E Ratio
    24.8%
    ROCE

    Financial Performance Highlights

    Q2 FY25 vs Q2 FY24

    Revenue from Operations grew by 29.6% to ₹2,492 Mn. EBITDA increased by 51% to ₹777 Mn, with margins improving to 31.16%. PAT rose by 56% YoY to ₹465 Mn.

    H1 FY25

    Revenue: ₹4,551 Mn (YoY growth of 37%)
    EBITDA: ₹1,359 Mn (52% increase YoY)
    PAT: ₹785 Mn (53% YoY increase)

    Strategic Growth Drivers

    1. Diversified Business Portfolio

    Stock Broking: Expanding presence in Tier III and below geographies
    Insurance Distribution: 131% YoY growth in policies sold
    MSME Lending: Recent acquisitions of Paisobuddy and Sureworth
    Government Advisory: Substantial infrastructure consulting order book

    2. Operational Metrics

    30.2% Operating Profit Margin and 23.6% Return on Equity highlight strong operational efficiency. Continuous focus on client-centric innovations.

    3. Tech-Driven Expansion

    Proprietary digital tools enhance customer engagement with upcoming features like family mapping and simplified auto-pay journeys.

    Future Projections

    Projected revenue CAGR of 30-35% over the next three years. PAT growth expected to sustain at 50-55%. Pan-India expansion through 168 branch offices.

    Investment Recommendation

    Rating: BUY (Long-Term Horizon)

    Target Price: ₹750 (12-month horizon)
    Upside Potential: ~36% from current market price of ₹550

    Disclaimer

    This report is for informational purposes only and should not be considered as investment advice. The information contained herein is based on sources believed to be reliable, but no guarantee is made as to its accuracy. Investors should conduct their own research and consult with financial advisors before making investment decisions. Past performance is not indicative of future results.

  • Kronox Lab Sciences (KRONOX) Stock Forecast 2025: Growth Analysis & Revenue Projections | Specialty Chemicals Leader

    Kronox Lab Sciences Limited

    Company Overview

    Kronox Lab Sciences Limited (KRONOX) is a leading manufacturer specializing in high-purity specialty fine chemicals. With an extensive portfolio of 185 products, KRONOX caters to pharmaceutical, nutraceutical, and food industries globally. The company operates from strategically located manufacturing units in Vadodara and is poised for expansion with a new facility in Dahej, Bharuch. KRONOX’s certifications, including FSSC 22000, GMP, GLP, ISO 9001:2015, and ISO 45001:2018, underscore its commitment to quality and compliance.

    Investment Highlights

    Market Position: KRONOX successfully listed on NSE and BSE in 2024, attracting over 31,000 investors. The company benefits from robust customer relationships and long-term supply commitments domestically and internationally.

    Strong Financial Metrics

    Market Cap
    ₹ 799 Cr.
    Current Price
    ₹ 215
    52-Week High/Low
    ₹ 229 / ₹ 138
    P/E Ratio
    34.2
    Book Value Per Share
    ₹ 20.8
    ROCE
    51.5%
    ROE
    38.4%
    Dividend Yield
    0.23%

    Revenue and Profitability Trends

    Sales (FY24)
    ₹ 92.9 Cr. (-5.98% YoY)
    Profit After Tax
    ₹ 23.3 Cr. (+30.3% YoY)
    Operating Profit Margin
    33.5%
    Sales Growth (3-Year CAGR)
    12.9%

    Key Financial Ratios

    Fixed Assets Turnover Ratio
    3.40x
    PAT Margin
    23.57%
    Cash Conversion Cycle
    96 days

    Risks and Concerns

    1. Dependency on Export Markets: Exports contribute approximately 25.21% of revenue, exposing the company to forex fluctuations and global demand-supply dynamics.
    2. Sales Decline: Sales witnessed a decline of 5.98% in FY24, necessitating analysis of underlying factors and mitigation strategies.
    3. Capacity Utilization Risk: While expansion plans are promising, under-utilization of the new Dahej facility could impact returns.

    Valuation

    At a P/E ratio of 34.2x, KRONOX’s valuation reflects investor confidence in its growth trajectory. With a book value per share of ₹ 20.8, the stock trades at approximately 10.34x its book value. Given the company’s robust ROE and ROCE, the valuation appears justified but demands monitoring of sales growth and profitability sustainability.

    Conclusion and Recommendation

    KRONOX Lab Sciences Limited represents a compelling growth story with a robust operational framework, debt-free status, and significant expansion plans. However, investors should watch for improvements in sales performance and capacity utilization post-expansion.

    Stock Rating: BUY

  • Mrs. Bectors food:15% growth target, 590 billion opportunity and QSR expansion plan

    Mrs. Bectors Food Specialties Ltd – Equity Research Report

    Mrs. Bectors Food Specialties Ltd

    Rating: BUY | Risk Profile: Medium to High

    Executive Summary

    Mrs. Bectors Food Specialties Limited (MBFSL) has established itself as a leading player in India’s premium biscuit, bakery, and QSR supply chain segments. With a presence in over 65 countries and state-of-the-art manufacturing facilities, the company is well-positioned to capitalize on the growing FMCG landscape. Our analysis indicates strong growth potential driven by capacity expansion, product innovation, and strategic QSR partnerships.

    Business Overview

    Product Portfolio

    • Biscuits Division:
      • Domestic range: Premium cookies, creams, crackers, digestives, and Marie
      • Export-specific products
      • Market leader in premium segments in North India
    • Bakery Division:
      • Retail products: Breads, buns, cakes, and gourmet items
      • Institutional offerings: Custom products for QSR chains
      • Innovation in premium categories (sourdough, ciabatta)
    • QSR Division:
      • Strategic supplier to major chains including McDonald’s
      • Walmart partnership under India sourcing initiative
      • Specialized production facilities for institutional clients

    Industry Analysis

    Market Size & Growth Potential

    • Biscuit Market:
      • Current size (FY20): ₹380 billion; Projected size (FY25): ₹590 billion
      • CAGR: 9%
      • Growth drivers: Low per capita consumption, premiumization trend, growing organized retail
    • Bakery Market:
      • Bread & buns market (FY20): ₹50 billion; Projected size (FY25): ₹76 billion
      • Premium segment growth: 15% CAGR
    • QSR Segment:
      • Current size (FY20): ₹188 billion; Projected size (FY25): ₹524 billion
      • CAGR: 23%

    Strategic Initiatives

    • Manufacturing Excellence: ₹469 Cr investment (FY20-24); capacity expansion of 38,760 MT for biscuits and 24,741 MT for bakery.
    • Distribution Network: 7 lakh+ retail outlets, 3 lakh+ direct reach, 490+ super stockists, 1,250+ distributors.
    • Product Innovation: Focus on health products (Zero Maida range) and premium categories.

    Financial Analysis

    Recent Performance

    • Q2 FY25 Results: Revenue ₹496.3 Cr (+19.7% YoY), EBITDA ₹70.5 Cr (+9.0% YoY), PAT ₹38.9 Cr (+4.4% YoY), EBITDA margin 14.2%
    • H1 FY25 Results: Revenue ₹935.7 Cr (+18.6% YoY), EBITDA ₹134.5 Cr (+9.7% YoY), PAT ₹74.4 Cr (+3.1% YoY), EBITDA margin 14.4%

    Key Financial Metrics (FY24)

    • EBITDA Margin: 14.9%
    • PAT Margin: 8.6%
    • Net Debt-to-Equity: 0.2x
    • Operating Cash Flow: ₹153.4 Cr

    Investment Thesis

    Strengths: Strong brand presence in premium segments, robust QSR partnerships, state-of-the-art manufacturing capabilities, healthy financial metrics.

    Growth Drivers: Industry tailwinds, capacity expansion, product innovation pipeline, distribution network enhancement.

    Risks: Raw material price volatility, competitive intensity, geographic concentration, execution risks in expansion.

    Valuation & Recommendation

    We maintain a BUY rating based on robust growth trajectory, strong order visibility (24-36 months), clear expansion strategy, a healthy balance sheet, and premium market positioning. Suitable for investors with a medium to long-term investment horizon seeking quality growth stocks in the FMCG sector.

  • Dixon: Safe Investment with 40% annual growth projection for next 4 years

    Dixon Technologies : Value Pick Best share to buy for long term

    Executive Summary

    Dixon Technologies( BSE: 540699 NSE: DIXON ) emerges as a pivotal player in India’s electronic manufacturing services (EMS) landscape, demonstrating remarkable growth and strategic positioning across multiple high-potential verticals. With a market capitalization of ₹1,13,125 Cr. and aggressive expansion plans, the company represents a compelling investment opportunity in the Indian electronics manufacturing ecosystem.

    Key Financial Metrics

    • Market Cap: ₹1,13,125 Cr.
    • Sales Growth (YoY): 102%
    • Profit Growth (YoY): 82.6%
    • Return on Equity: 24.7%

    Strategic Verticals

    • Mobile & EMS: ₹9,444 Cr.
    • Consumer Electronics: ₹1,413 Cr.
    • Home Appliances: ₹444 Cr.

    Investment Thesis

    Dixon Technologies represents a compelling investment in India’s electronic manufacturing transformation, driven by leadership in Electronic Manufacturing Services, a diversified product portfolio, strong government support, and an extensive global partnership ecosystem.

    Recommendation

    Strong BUY

    3-5 Year Investment Horizon

  • Equitas Small Finance Bank Q2 FY25: Strategic Growth, Digital Transformation, and Resilient Banking Model | Equity Research Insights

    Equitas Bank – Equity Research Report Q2 FY25

    Equity Research Report: Equitas Small Finance Bank

    Q2 FY25 Analysis | NSE: EQUITASBNK

    Company Overview & Key Financial Metrics

    Market Cap
    ₹7,330 Cr.
    Current Price
    ₹64.3
    52-Week Range
    ₹61.4 – ₹116
    Book Value
    ₹52.6
    Dividend Yield
    1.55%
    ROCE
    8.97%
    ROE
    14.4%
    Total Debt
    ₹37,917 Cr.
    Reserves
    ₹4,834 Cr.
    Q2 FY25 Sales
    ₹5,929 Cr.
    Q2 FY25 PAT
    ₹448 Cr.
    OPM
    41.5%

    Performance Highlights (Q2 FY25)

    1. Revenue and Profitability

    Net Interest Income
    ₹802 Cr.
    11% YoY Growth
    Other Income
    ₹229 Cr.
    156% YoY Treasury Income Growth
    PPOP
    ₹350 Cr.
    6% YoY Growth
    Credit Cost
    ₹330 Cr.

    2. Loan Book Performance

    Total Advances
    ₹36,053 Cr.
    15% YoY, 3% QoQ Growth
    Small Business Loans
    ₹14,678 Cr.
    28% YoY Growth
    Vehicle Finance
    ₹8,877 Cr.
    14% YoY Growth
    Affordable Housing
    23% YoY Growth

    3. Asset Quality

    Gross NPA
    ₹1,023 Cr.
    PCR
    67.7%
    Improved from 57.7%

    4. Microfinance Segment

    • Portfolio contribution reduced from 18% to 16% YoY
    • Elevated credit costs around 10% for H1 FY25
    • Additional ₹100 Cr. buffer for SMA book

    Future Growth Strategies

    1. Loan Disbursement Expansion
      • Small Business Loans: Flagship product expansion through new branch networks
      • Micro LAP: Consistent month-on-month growth
      • Vehicle Finance: Focus on used vehicle segments
    2. Technology and Infrastructure
      • CRM enhancements
      • Customer mobile applications
      • “Selfie Loan App” development
      • 40-50 new branches annually
    3. Product Diversification
      • Personal loans
      • Credit cards
      • AD-1 financial products
    4. Macroeconomic Advantages
      • Strong retail deposit mix (79%)
      • Favorable bond market conditions

    Risk Assessment

    1. Microfinance Sector Challenges
      • ~50% SMA bucket conversion to NPAs
      • Continued sector stress expected for 2-3 quarters
    2. Financial Structure Risks
      • High debt levels (₹37,917 Cr.)
      • Capital allocation requirements
    3. Operational Efficiency
      • Cost to Income Ratio: 66%
      • Expected stabilization post-FY27
    4. External Factors
      • Interest rate fluctuations
      • Geopolitical risks
      • Market volatility impact on treasury

    Valuation and Recommendation

    P/E Ratio
    16.4x
    Potential Upside
    30-40%
    Over next 12 months

    Investment Thesis

    • Strong growth in secured loan segments
    • Ongoing digital transformation
    • Robust retail deposit base
    • Long-term growth potential outweighing short-term challenges
    Recommendation: ACCUMULATE

    Suitable for long-term investors with moderate risk tolerance. The combination of strong growth in secured loan segments, ongoing digital transformation initiatives, and robust retail deposit base supports a positive long-term outlook despite near-term microfinance sector challenges.

    TradingView chart

    Disclaimer: This report is for informational purposes only and should not be considered financial advice. Always conduct your own research and consult with a financial advisor before making investment decisions.

  • Mohit Industries: Growth Opportunities and Challenges in Polyester Yarn Manufacturing

    Equity Research Report: Mohit Industries Limited

    Equity Research Report: Mohit Industries Limited

    NSE: MOHITIND

    Executive Summary

    Mohit Industries Limited finds itself at a critical juncture, facing significant operational challenges in a dynamic textile market. This report provides a comprehensive analysis of the company’s financial performance, strategic positioning, and potential paths to recovery.

    Company Profile

    Business Overview

    Mohit Industries is a textile manufacturing company specializing in Polyester Draw Texturized Yarn (DTY), with a notable presence in both domestic and international markets. The company’s current financial landscape reflects the broader challenges in the textile manufacturing sector.

    Key Financial Snapshot

    MetricValue
    Market Capitalization₹54.1 Cr
    Current Stock Price₹38.2
    52-Week Price Range₹16.5 – ₹42.9
    Book Value per Share₹192
    Face Value₹10.0

    Detailed Financial Analysis

    Revenue and Profitability Metrics

    MetricValue
    Revenue (FY 2023-24)₹131.6 Cr
    Profit After Tax₹-1.93 Cr (Net Loss)
    ROCE0.50%
    ROE-0.85%
    Operating Profit Margin1.35%

    Key Insights:

    • 31% Year-on-Year decline in sales
    • Significant contraction in export market presence
    • Challenging operational environment

    Strategic Analysis

    Strengths

    • Export capabilities
    • Strong branding in Polyester Draw Texturized Yarn (DTY)
    • Established international market presence
    • Substantial reserves of ₹259 Cr

    Challenges and Risk Factors

    1. Operational inefficiencies: Low Operating Profit Margin (1.35%)
    2. Financial vulnerabilities: High debt burden of ₹52.4 Cr
    3. Market constraints: Declining revenue in both domestic and export markets

    Strategic Recommendations

    Immediate-Term Initiatives

    • Operational Optimization: Cost reduction, energy efficiency improvements
    • Financial Restructuring: Debt consolidation, alternative financing
    • Market Diversification: Expand product portfolio and target emerging markets

    Long-Term Growth Strategy

    • Invest in technological upgradation
    • Develop sustainable textile solutions
    • Create resilient supply chain mechanisms
    • Explore vertical integration opportunities

    Valuation Perspective

    Current Stock Price: ₹38.2
    Book Value per Share: ₹192
    Price-to-Book Ratio: Significantly below 1

    Investment Recommendation

    Rating: HOLD (High Risk)

    Suitable for investors with high risk tolerance. Potential turnaround story dependent on restructuring efforts.

    © 2024 Equity Research Report | Mohit Industries Limited

  • RBL Bank (NSE: RBLBANK) Future Growth Insights: Highlighting Expansion and Value Potential








    RBL Bank Analysis | Financial Research Report


    RBL Bank (NSE: RBLBANK)

    Comprehensive Equity Research Report

    Executive Summary

    This comprehensive equity research report provides an in-depth analysis of RBL Bank’s financial performance, strategic positioning, and investment potential within the Indian banking sector.

    Company Overview

    RBL Bank is a mid-sized private sector bank known for its innovative approach, digital banking solutions, and focused growth strategy. Listed on the National Stock Exchange (NSE: RBLBANK), the bank has been transforming its business model to enhance operational efficiency and customer experience.

    Market Cap

    ₹10,529 Cr

    Stock Price

    ₹173

    Face Value

    ₹10.0

    Financial Analysis

    Profitability Metrics

    ROCE

    6.23%

    ROE

    8.23%

    Net Profit

    ₹1,180 Cr

    Growth Dynamics

    Advances Growth

    23.2%

    Deposit Growth

    11.1%

    NII Growth

    31.9%

    Asset Quality

    GNPA Ratio

    5.6%

    Net NPA Ratio

    2.8%

    PCR

    68.5%

    Strategic Strengths

    • Robust digital banking platforms and advanced mobile solutions
    • Diversified loan portfolio with balanced risk approach
    • Strong operational efficiency with 45.6% cost-to-income ratio

    Investment Recommendation

    ACCUMULATE

    Target Price Range: ₹250 – ₹280

    Potential Upside: 45% – 60%


    TradingView chart

    Disclaimer

    This report is for informational purposes only and should not be considered financial advice. Investors are recommended to conduct their own due diligence and consult financial professionals before making investment decisions.

  • EPACK Durable Limited: Growth Analysis, Financial Insights, and Capex Strategies for FY25

    EPACK Durable Limited – Company Report

    EPACK Durable Limited NSE: EPACK

    Company Overview

    EPACK Durable Limited specializes in manufacturing white goods and small domestic appliances. It is leveraging strategic partnerships and expanding its manufacturing capacity to meet growing demand in the domestic and global markets. The company recently added new facilities, diversified its product lines, and initiated tie-ups with marquee brands like Hisense and Panasonic.

    Key Financial Metrics (Q2 FY25)

    Revenue

    INR 377 crores

    (+112% YoY)
    EBITDA

    INR 9.6 crores

    (+25% YoY)
    EBITDA Margin

    2.55%

    Net Loss

    INR 8.5 crores

    (vs. INR 6 crores in Q2 FY24)

    Half-Yearly Metrics (H1 FY25)

    Revenue

    INR 1,151 crores

    (+87% YoY)
    EBITDA

    INR 62 crores

    (+66% YoY)
    Net Profit

    INR 15 crores

    (+452% YoY)
    EBITDA Margin

    5.34%

    PAT Margin

    1.29%

    Stock and Financial Metrics

    Market Cap

    ₹ 4,421 Cr

    Current Price

    ₹ 461

    52-Week High/Low

    ₹ 517 / 151

    Stock P/E

    92.8

    Book Value

    ₹ 94.9

    Dividend Yield

    0.00%

    ROCE

    8.32%

    ROE

    5.85%

    Face Value

    ₹ 10.0

    Debt

    ₹ 488 Cr

    Reserves

    ₹ 815 Cr

    Profit After Tax

    ₹ 47.6 Cr

    Sales Growth (3Yrs)

    24.5%

    Profit Growth (3Yrs)

    65.7%

    Sales (FY25)

    ₹ 1,956 Cr

    Operating Profit Margin

    7.09%

    Quarterly Sales Variation

    112%

    Capex and Expansion Plans

    1. Sri City Plant Utilization

    • Current utilization: 10%
    • Target utilization: 30% by FY25 end and 60%+ in FY26
    • Investment enables a 50% increase in manufacturing capacity

    2. Hisense Partnership

    • New facility in Andhra Pradesh, with production starting in Q2 FY26
    • Capex: INR 240 crores over three years
    • Target capacity: 1.5 million AC units by FY28
    • Expected revenue: $1 billion in five years

    3. Diversification Efforts

    • New product lines in small home appliances, washing machines, and coolers
    • Pilot production for washing machines already completed; operations to begin by Q4 FY25
    • Additional product expansion planned in collaboration with Panasonic

    4. Backward Integration

    • 75% of components manufactured in-house
    • Recent increase in equity in motor manufacturing subsidiary to 50%

    5. Planned Investments

    • INR 50 crores allocated for upgrading existing facilities
    • INR 230 crores from IPO proceeds to fund growth

    Growth Drivers

    1. Market Demand

    • Revenue growth is supported by rising demand for air conditioners (187% YoY) and other home appliances
    • Industry CAGR for air conditioners projected at 17%-18% over the next 3-4 years

    2. Export Expansion

    • Exports have grown threefold YoY, with upcoming certifications for markets like the US and Europe
    • New facilities and partnerships to support increased export contributions

    3. Product Mix Optimization

    • Strategic focus on high-margin small appliances and new products
    • Diversification reduces dependency on air conditioners, which currently account for 70% of product revenue

    4. Operational Efficiencies

    • Focus on maximizing asset turnover (target: 4.5x for core business, 5-6x for Hisense)
    • Optimized capacity utilization at Sri City to improve margins

    Challenges

    1. Margin Pressure

    • Current EBITDA margins are impacted by underutilized capacity at Sri City and increased fixed costs
    • Air conditioners—a lower-margin product—dominate the revenue mix

    2. Working Capital

    • Temporary rise in debt due to reduced bill discounting
    • Efforts to manage cash flows effectively by leveraging internal accruals and existing funds

    3. Raw Material Dependence

    • 45%-50% of raw materials are imported, exposing the company to forex and logistical challenges
    • Efforts to localize supply through backward integration are ongoing but not complete

    Projections

    1. Revenue Growth

    • FY25 revenue growth target: 50% YoY
    • Long-term CAGR (next 5 years): 40%-50%

    2. Profitability

    • EBITDA margin target: ~8% by FY25, with improvements expected as utilization increases
    • ROE/ROCE target: ~17% within 3 years

    3. Capex

    • Total planned investment: INR 290 crores over the next three years
    • TradingView chart

      Conclusion

      EPACK Durable Limited is poised for significant growth, supported by strategic capex, partnerships, and a diversified product portfolio. While margin pressures and working capital challenges remain, the company’s focus on operational efficiency, export expansion, and product mix optimization provides a solid foundation for long-term profitability. Investors should monitor utilization rates, export performance, and margin improvements as key indicators of future success.

  • Cyient Limited: Semiconductor & Tech Innovation Driving Stellar Q2 FY25 Performance

    NSE:CYIENT – Equity Research Report: Cyient Limited – Q2 FY25 Detailed Analysis

    Company Overview

    Cyient Limited is a global technology solutions provider specializing in design engineering, digital transformation, and technology services. With a rich history of innovation and strategic evolution, the company has successfully positioned itself at the intersection of multiple high-growth technological domains, including semiconductors, energy, transportation, and digital solutions.

    Detailed Financial Performance Analysis

    Revenue Dynamics

    • Quarterly Revenue: ₹1,849 Cr., representing a 4% year-on-year growth

    • Revenue Composition:

      1. Connectivity Segment: 3.9% quarter-on-quarter growth

      2. Transportation Segment: 3.4% QoQ growth, but facing 7.3% YoY challenges

      3. Sustainability Segment: Seasonal decline of 6.4% QoQ

      4. New Growth Areas (Semiconductors): Robust 9.7% QoQ expansion

    Profitability Metrics

    • Profit After Tax (PAT): ₹694 Cr., showcasing a remarkable 24.5% quarter-on-quarter growth

    • Margin Expansion:

      • Design Engineering and Technology (DET) EBIT margin increased by 75 basis points to 14.2%

      • Management targeting exit EBIT margin of 16% in H2 FY25

    Strategic Initiatives Deep Dive

    Semiconductor Strategy

    Cyient has made significant strides in the semiconductor ecosystem:

    • Establishment of Cyient Semiconductors Private Limited

    • Fabless ASIC design model with focused chip sales approach

    • Strategic acquisition of 27.3% stake in Azimuth AI

    • Projected capital allocation of $100 million for semiconductor business expansion

    Geographic and Sectoral Expansion

    • Middle East Penetration:

      • Acquisition of Abu Dhabi & Gulf Computer Establishment (ADGCE)

      • Strengthening footprint in energy and technology markets

    • Diversification Focus:

      • Healthcare and life sciences

      • Automotive technologies

      • IoT-driven analytics platforms

      • AI and digital innovation solutions

    Financial Health Indicators

    Balance Sheet Strength

    • Market Capitalization: ₹23,262 Cr.

    • Debt Reduction: Significant decline from $94 million to $9 million

    • Key Financial Ratios:

      • Return on Capital Employed (ROCE): 21.9%

      • Return on Equity (ROE): 18.8%

      • Stock Price-to-Earnings (P/E): 33.5

      • Book Value: ₹463

      • Dividend Yield: 1.44%

    Capital Allocation and Shareholder Returns

    • Interim Dividend: ₹12 per share for FY25

    • Organic cash generation supporting strategic investments

    • Proceeds from partial divestiture of Cyient DLM reinvested strategically

    Market Outlook and Challenges

    Growth Opportunities

    • Semiconductor Sector: Rapid scaling potential

    • Energy and Sustainability: Increased market penetration in Europe and Middle East

    • Talent and Automation: Continuous focus on operational efficiency

    Potential Headwinds

    • Macroeconomic uncertainties in automotive and transportation sectors

    • Seasonal fluctuations in sustainability segment

    • Geographic-specific market slowdowns

    Investment Thesis

    Investment Strengths

    1. Diversified technological portfolio

    2. Strong operational efficiency

    3. Robust balance sheet

    4. Strategic focus on high-growth sectors

    5. Proven debt reduction capabilities

    Risk Mitigation Strategies

    • Geographic diversification

    • Multi-sector presence

    • Continuous investment in emerging technologies

    • Agile operational model

    Valuation and Recommendation

    Recommendation: BUY with a long-term perspective

    Target Investor Profile:

    • Growth-oriented investors

    • Those seeking exposure to technology and engineering services

    • Investors comfortable with moderate sector cyclicality

    Price Target Range: ₹2,300 – ₹2,500 (6-12 month horizon)

    TradingView chart

    Conclusion

    Cyient Limited demonstrates remarkable resilience and strategic adaptability. Its focused approach to high-potential technological domains, coupled with strong financial discipline, positions the company favorably for sustained growth and shareholder value creation.

    The company’s ability to navigate complex market dynamics, invest in emerging technologies, and maintain operational excellence makes it an attractive investment opportunity in the technology services landscape.

    Disclaimer: This analysis is based on the provided Q2 FY25 report and should not be considered absolute financial advice. Investors are recommended to conduct their own due diligence and consult financial advisors before making investment decisions.

Value Picks fin.ctoi.in
Value Picks fin.ctoi.in
Value Picks

Dont Miss our Value picks

SUBSCRIBE TO OUR NEWSLETTER to Get short term, long term and multi-bagger

We don’t spam! Read our privacy policy for more info.