Management Interviews – ROHL and India Cements

ROHL – Amit Jaiswal – CFO

  • Our occupancy will cross 80%, already at 78% occupancy across our hotels
  • Pune, Mumbai, Navi Mumbai hotels does 90%+ occupancy
  • Average revenue did not see much growth last year ~ Rs 3800. FY19 will see 8-10% growth
  • Average Revenue grows when your competition is also doing well
  • Margins will improve by atleast 20%+ , By year end we should be seeing margin improvement by 25-30%
  • If trend continues, in FY20 consolidated EBITDA will cross 50 crs
  • For Powai land – Waiting for official gazette approval by mumbai government for change of land use from hotel project to commercial which will give us a better value, we may slog it off by outright sale or can do joint development. Size of plot is little more than an acre (5500 sq. mt)
  • Tanzania land – will like to close it out this financial year –  ~25 crores can be the value
  • Current debt on books is 36 crs standalone and 76 crs consolidated
  • We are also looking into some leased assets to increase our topline and profitability

Full Interview:

https://twitter.com/CNBCTV18News/status/986480329312501760?s=08

 

India Cements – Rakesh Singh, President

  • In last 5 years south had no demand growth or negative demand growth
  • We had a growth of 1% in Q2FY18, 6% in Q3FY18 and 15% in Q4FY18 leading to 4% growth for the year
  • Last quarter growth from AP and Telangana was as high as 37%, for a year as a whole it was 17%
  • Lack of demand from Tamil Nadu due to lack of water, sand mining issues. Decent growth of 4% in last quarter
  • If Tamil Nadu comes back on track, we look forward to 10% growth for current year
  • Big trigger was AP and Telangana government doing irrigation projects, one has to see Kaleshwaram project of Telangana, amount of concrete going in is unbelievable
  • Low cost housing, irrigation and road projects are slowly taking shape in Maharashtra, Karnataka
  • Believe lack of demand from Tamil nadu and kerela is behind us, can see better growth on low base in coming quarters
  • In Q4 industry operated at 68% capacity utilizations, for year as a whole we are nearly close to 60%
  • Plants in north of south will do better than plants in south of south, we have 4 plants in AP and Telangana
  • For India cements capacity utilizations in Q4 was at 70%
  • Wont rule out industry capacity utlizations at 70% and India cements at 75% if there is 10-12% growth plus Maharashtra is growing at 11%
  • In commodity pricing is the most important thing but pricing power is not currently with manufacturers, have seen some marginal improvement though
  • Cost of Pet coke and Coal are substantially up, so the prices of cement has to be up for companies to make decent profits
  • As demand will grow we see to make more than what we will loose on cost front

Full Interview :

https://www.youtube.com/watch?v=-kRKBCvP7MY

 

Management Interviews – Mcleod Russel, Srei Infra, Ashok Leyland

Mcleod Russel – Kamal Baheti – CFO

  • Old season crop got sold must faster, last year demand was very strong and inventories were lower
  • Production for this season started in middle of march,demand is very strong, prices are little higher ~₹25-30/kg
  • Generally 100% absorption at auction never happens, 70-80% absorption is considered good
  • After 3 years we have seen positive momentum in prices and if auction happens at ₹25-30 it will augur well for our margins
  • Wage agreement is due to be implemented from Jan 2018, will have to see its impact on cost
  • After wage increase we estimate to increase margins by ₹10-15/kg from 8-9% to 13-14%
  • Global market is also strong, we sold 19.5 mn kgs vs 14.5 mn kgs previous year
  • With higher exports domestic inventory will be lower, this year we can see turnaround in tea prices and might continue for some years
  • Will get clear indication in 3-4 weeks time

Full Interview :

http://www.btvi.in/videos/watch/26358/mcleod-russel–what-s-brewing-

 

Srei Infra – Hemant Kanoria – Chairman & MD

  • In CME (Construction, Mining and Equipment) Financing there is no severe new competition
  • We have 30-35% market share and close to 100000 customers
  • We have been able to maintain the margins (NIMs ~5.26%) as the cost of risk and operation have come down
  • Internally we have divided portfolio in 2 segments – New business from 2013 and Previous one
  • In the old business, we have a team who is working with clients to recover money
  • In the new business, NPL’s are extremely low as credit policy has improved, so portfolio is of good quality
  • NPA recovery now will be at a slower pace but we surely are working on it
  • We finance income generating equipment’s, we see demand would be picking up
  • Farm equipment has not been an interesting business for us, we have created a new model in conjunction with Sahaj
  • Will be able to reduce the risk substantially through Sahaj and will be able to provide complement of equipments to farmers

Full Interview

http://www.btvi.in/videos/watch/26356/srei-infra–business-outlook

 

Ashok Leyland Update – Amandeep Singh, Head Defence – 16-04-2018

  • Won an 100 crore order for 10×10 vehicle to carry Smerch Rockets
  • It is the First Indian made 10×10 vehicle will be used by Indian army
  • Delivery of some vehicles will be in 2nd half of this year and balance in 1st half of next year
  • 26 mobility tenders won in last 2 years, total potential of orders for next 7-8 years can be 5000 crs
  • Capex outlay in defence of have gone up from 2%  to 5% and now plan to increase it to 20% in few years time
  • Revenues from defence doubled in last 2 years from 400 to 800 crs
  • Market size : We expect to play in 20% of 80000 crs worth of army capex in next 4 years time, currently we are leaders but even if we get 33% of that we are looking at 5000 crs in next few years time

Full Interview :

http://www.btvi.in/videos/watch/26362/have-bagged-rs-100-cr-order-from-mod–ashok-leyland

Is Sun Pharma Checking In Unichem Laboratories ?

 

Unichem Labs Share Holding Pattern

Share holder Name Dec-17 Mar-18
  No of shares % holding No of shares % holding
Alrox Investment & Finance 1597763 1.76% 997437 1.42%
Airborne investment & Finance 1149452 1.26% 717568 1.02%
Family Investment Pvt Ltd 1438522 1.58% 898026 1.28%

 

Sun Pharma Share Holding Pattern

Share holder Name Mar-18
  No of shares % holding
Viditi Investment Pvt Ltd 200846362 8.37%
Family Investment Pvt Ltd 182437880 7.60%
Virtuous Finance Pvt Ltd 96851821 4.04%
Virtuous Share Investment Pvt Ltd 83751259 3.49%

Whats common between this entities : –

  1. The Companies Address of Alrox, Airborne & Family investment is same as Taro Pharmaceuticals India Pvt Ltd.
  2. The Director of Alrox Investment, Airborne Investment is the same of Virtuous Finance, Virtuous Share — Mr Dineshkumar Ramniklal Desai
  3. The Director of Family Investment Pvt Ltd & Viditi Investment is the same Mr. Milind Vijay Goradia

Amber Enterprises – Jasbir Singh

Amber Enterprises – Jasbir Singh – 15-04-2018

  • Rationale of expanding in different products (currently 17% of revenues) like functional components of white goods is to utilize our capacities without doing any capex
  • Core focus will be Room AC and HVAC components which is 80% of revenues
  • Above expansion is just because our customers want more integrated solution – so that’s just increasing wallet share from existing customers
  • Last year capacity utilizations in AC was 50%, on seasonal basis we work at 60-65%
  • Demand for AC is robust, people are buying more of inverter AC
  • We have started exporting to 9 countries, though the volumes are less, but inquiries are picking up as china is getting expensive
  • Our principal customers have also started exporting
  • More utilization naturally leads to better margins (Current margins ~8.5%)

 

Full Interview

VIP Industries – Dilip Piramal

VIP Industries – Dilip Piramal – 12-04-2018

  • Aviation figures are right barometers for us, impacts our industry directly
  • 1st quarter are our strongest quarter – peak season because of marriages
  • It is very easy to manufacture luggage, informal sector is large but after gst and demon we have gained additional 10% mkt share
  • Informal sector will also grow as the 1st time entrants start from informal sector
  • Sales have increased after gst for all the companies in formal sector which means it has come from informal sector
  • Its not a major objective to increase our market share at any cost, we are happy with what we get on our basis of efforts, products, distribution and advertising
  • Will now look at export markets
  • We have lot of scope in Handbag market ‘Caprese’ although the base is very small
  • It is very difficult to operate from Bangladesh but gradually increasing our activity there
  • CSD (Canteen Stores Departement) keeps altering policies and there is some uncertainty – but this affects entire industry not only us
  • CSD is an important segment to us, ~20% sales comes from it

 

Full Interview

 

Dai Ichi Karkaria – Mrs S.F.Vakil, MD

Dai Ichi Karkaria – Mrs S.F.Vakil, MD – 12-04-2018

  • New Dahej Plant – 30000 tonne capacity in 3 different kind of plants – doubling of current capacity
  • For several years we had good demand of products but could not offer due to capacity constraints, so we kept the prices high
  • Now once the plant will open up we will bring down the pricing and try to maximize our order book
  • We hopefully grow at 30-35% in coming year as partially plant will be started
  • Will reach 95% capacity utilizations in 5 years i.e. by March 2023
  • Main area of focus is construction chemicals, followed by oil fields
  • Our exports will go up as we have special arrangements with Nalco Champions to buy from us apart from JV
  • Invested 160 crs – so in current year we are trying to breakeven and in next 2-3 years will start showing income again

Full Interview :

 

 

OMMetals Infraprojects – Vikas Kothari, Director

OMMetals Infraprojects – Vikas Kothari, Director – 13-04-2018

  • Bagged order worth 157crs from SJVN
  • Order book of 700-750 odd crs contains about 14 projects
  • 10 projects to be completed in next 1-2 years and remaining 4 projects will take 3-4 years
  • FY 19 we are expecting good growth of around 20% in revenues
  • Ebitda margins are over 15% and Net margins are around 8-10%
  • As on today our core business is engineering and construction, real estate is an opportunistic investment
  • Real Estate – Expected revenue of 1000 crs from projects under execution / sale at kota, hyderabad and jaipur – 200 crs already recognized
  • Rest 800 crs will come in FY19 and FY20
  • Real estate land bank has negligible debt, finance cost have shot up because of working capital loans
  • Standalone debt is around 40-50 odd crs – Avg Wcap utilisation – 30-40 crs (9M FY18 Finance Cost = 13crs) 
  • Total debt (incl some packaging debt = 80 odd crs) Borrowing cost as per Mgmt = 13%; Nos dont add up; Mgmt will check and update
  • Continuously looking to monetize 1 road asset; not able to find the buyer; NHAI looking over to takeover the road
  • Once NHAI takes over the road, they’ll take the debt portion – debt shall reduce by 150-170 crs at consolidated level
  • Total land bank – 26000 sq.m. in bandra; 4-4.5 acre land in jaipur; 10 acres in hyderabad; 10 acres in kota
  • Baring the Bandra project, everything is being monetized

 

Full Interview :

https://www.cnbctv18.com/videos/market/expect-20-revenue-growth-in-fy19-says-om-metals-infra-34201.htm

 

 

Vmart – Lalit Agarwal, CMD

Vmart – Lalit Agarwal, CMD – 13-04-2018

  • People in smaller towns wants to buy good products from good places
  • With GST coming in, Organized retail is getting the benefits
  • Products that are selling in Tier-1 are also getting sold in Tier-3 and Tier-4 towns
  • We operate in clusters so we dont need too many warehouses and distribution facilities
  • Currently we have single warehouse in gurgaon (2.5L sq ft), will have to open few regional centres
  • Capex – ₹450mn-500mn; Around ₹12mn/store and open about 30-35 stores plus some back-end investments
  • 10 players like Vmart can be accommodated as the market is too large
  • Mkt share of Vmart today is < 5% in the market they exist
  • Promoter entity has not increased any stake, just consolidated stake to one entity
  • We are focusing on tier 2 and tier 3 cities as that is where large amount of population lies
  • Our customer focus is people who earns ₹20-50K/month
  • Since 2012 all the stores we have opened up are without FMCG (Kiraana)
  • We are doing good in apparel business which is appreciated by the customers

 

Full Interview :

Sequent Scientific – Manish Gupta, MD

Sequent Scientific – Manish Gupta, MD – 12-04-2018

  • People confuse animal health to human pharma
  • Ours is a similar indutsry to FMCG
  • Animal health business is close to 900 crs on annual runrate basis
  • 70% revenue comes from europe; India is less than 10%
  • We are the only to have US FDA Approved Vet facility in the country
  • Aspiration is to be in global top 10 in next 4 years – Revenues of 2000 crs  (Current 800 odd crs)
  • Expecting improvement in margins of 200bps yoy – will be closer to 20% in next 4 years time
  • Growth will come from
    • Organic growth – as it is branded generic industry; every year we claw some shares of other
    • New product pipeline – 28 products under development
    • Inorganic strategies – for some of the unrepresented market in our portfolio
  • US and Australia are important veterinary geographies – Area of focus for inorganic growth
  • API – As we grow in US – Growth will be price driven and not volume driven – will translate into margins
  • We are focused on food producing animals (60% of global demand is in food producing animals)
  • With demerger of human API business, we now are pure play animal health company
  • Post demerger – effective debt is ~300 crs; have cash of 50 crs and investments in strides shares; net basis we are zero debt co.

 

Full Interview :

Apollo Tyres – Neeraj Kanwar

  • Last year has been challenging in terms of margins – Raw material prices have gone up – Revenue side has been positive
  • Demon, GST, Anti duming duty has impacted Chinese imports in India. From nearly 30% of truck radial mkt they are down to 1/3rd of that
  • RM costs still have some pressure on margins due to oil prices, carbon black availability – Causing challenge to bottomline
  • Going forward seeing upwards momentum on both PV and CV side
  • See double digit growth coming in Q1 and Q2
  • Today demand is more than supply in terms of what we can cater to PV and CV segment
  • Times on revenue side are good
  • 60-65% sales comes from CV segment
  • We have 28-29% share in truck bus radials
  • Expect CV segment volume growth in high teens
  • Capex – doubling capacity in chennai 6000 to 12000 tyres/day (Currently at 9000 tyres/day)
  • Hungary plant – invested 500 mn euros – (Currently at 8000 tyres/day in PV); By Sept trying to reach 16000 tyres/day
  • TBR tyres to be launched this May-June in Europe
  • We have done very well in europe , gained mkt share there
  • Signed with AP Govt – cannot say the amount of money to be invested – still at project stage
  • Looking at building capacity of 16000 tyres/day in AP – but investments will start in FY20
  • Free cash flows will come in from FY19-20
  • Rubber prices – not been coming off – margins would be under pressure in Q4
  • RM basket still remains challenge for us and the industry

Full Interview: