#TataChem, #SuvenLife, #TriveniTurbines are the large trades in focus today.
Agam Vakil brings you bulk and block deal highlights of the day on 'Large Trades'. #NDTVProfitLive
Agam Vakil brings you bulk and block deal highlights of the day on 'Large Trades'. #NDTVProfitLive
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00:00 Yeah, so in terms of the order book,
00:04 we have an order book of about
00:07 175 crores at this point in time.
00:09 Uh, the in the quarter we had a bunch
00:11 of run rate orders that were culminated
00:14 on our side and we expect that many
00:16 of similar and other contracts that
00:18 we've been pursuing for a long time.
00:21 Now some of them will culminate in
00:23 this quarter as well that is currently
00:25 running and therefore there should
00:27 be augmentation to the order book.
00:29 At this point in time and.
00:31 That augmentation will both part
00:33 of it get executed and part of it
00:35 will reflect at the year end numbers
00:38 as well, right? Of course,
00:39 your main product being drones.
00:41 Can you perhaps give us a more color
00:44 on the kind of order book that you
00:46 have at the moment where these orders
00:49 coming from other sub segments
00:51 on which you're working with?
00:53 So typically our order book comes
00:55 from two broad areas which is
00:57 defense and civil and we have a
00:59 robust pipeline on both defense
01:01 and civil side and typically we
01:03 see that run rate businesses close
01:05 both from defense and civil customers,
01:07 but usually very large projects
01:09 close with the defense guys.
01:11 Alright,
01:11 and based on the kind of well,
01:13 expectations that you have with
01:15 the Defense Ministry outlay,
01:17 can you give us an idea about what
01:20 your expectation is as far as FI
01:22 25 is concerned with orders coming
01:24 through also if you could give us
01:27 a little bit of color if you are
01:29 in fact working on your export markets.
01:31 If there are any exports that you
01:33 are making through if you could
01:35 tell us a little more about that.
01:37 Yeah, we do expect the momentum
01:39 of procurement that the country
01:40 is initiated with respect to
01:42 drones to continue in the coming
01:43 year as well because the base at
01:45 which we are is very low and we
01:47 have a very very large headroom
01:49 to catch up to our neighbors
01:51 as well as global pass.
01:52 In terms of the exports market,
01:54 we've set ourselves well in the US.
01:56 We have now been able to ship our systems.
01:59 There we've started doing demonstrations
02:00 to end customers and our value
02:02 added resellers so that journey
02:04 of building a sales pipeline.
02:06 There is something that we are quite
02:08 excited about and progressively
02:09 over the next few months.
02:11 We will see a pipeline build up as well
02:14 as hopefully we will have a lot of
02:17 conversions from that pipeline in the
02:19 next year. You know, in terms of your mix,
02:22 I am looking at about 93%,
02:24 which is defense that you've
02:26 already made a point of.
02:27 And civil stands at around 7%.
02:30 Any chance that your civil side
02:32 of orders would perhaps broaden?
02:34 I understand that you already are
02:36 inundated with a lot of your defense
02:39 defense orders. What's the way forward
02:41 as far as the civil segment is concerned?
02:45 No, even in the civil segment,
02:48 I think we're seeing good demand.
02:50 The demand is growing,
02:52 albeit the base of that demand,
02:54 particularly with respect to capital
02:56 assets is is relatively lower at this
02:58 point in time, but it was going to
03:00 catch up with very large demand coming
03:03 up because of the kind of geopolitical
03:05 environment we have internally as well.
03:07 So we are seeing that that demand is
03:09 building up and there are opportunities
03:11 we are pursuing and tracking from the
03:13 long term right now. Could you give us
03:16 an idea about the kind of clientele
03:18 that you have when it comes to this?
03:20 The civil segment?
03:21 Yeah, so typically the kind of
03:24 customers we have as all the CAPFs
03:26 that we have Central Armed Police
03:28 Forces, then we have clients in terms
03:30 of the law enforcement agencies in
03:32 various states and then we have
03:34 customers in the form of various
03:36 government departments or we also
03:37 have industrial entities or service
03:39 providers who look at our drones to
03:41 deliver on various applications around
03:43 mapping and surveillance at this point
03:45 in time. Like I mentioned in our
03:47 presentation, we are also looking at.
03:51 Increasingly exploring the opportunity
03:53 of doing inspections with our drones.
03:55 OK, and you know my next question,
03:57 perhaps this is the final one.
03:59 Is there a difference between operating
04:01 margins in your civil and well defense
04:04 segment? No, as such it does not pan
04:06 out in that kind of an order.
04:09 OK, and a final word.
04:10 If you could give us an idea on perhaps
04:13 what kind of revenues are you looking
04:16 at when it comes to FI 25 and I
04:19 understand if you can't give us an
04:22 estimate, but some sort of a ballpark
04:24 number or a figure or growth wise,
04:26 you know estimate if you could just
04:28 leave us with something like that.
04:30 At this point in time,
04:32 I will only be able to comment on
04:34 it in the next call, perhaps.
04:36 OK, fair enough.
04:37 We leave it at that.
04:38 Thank you so much for joining us and
04:40 taking us through the quarters earnings
04:42 as well as what we can possibly
04:44 expect from your company.
04:46 We're looking at strong numbers
04:47 as I've already mentioned.
04:48 Well, thanks for joining in and on
04:50 that note it's time to slip into a
04:52 short break but don't go anywhere.
04:54 On the other side we talk about
04:56 stocks and a lot more. Stay tuned.
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07:57 Welcome back. You're watching Large Trades
08:00 and we now shift focus to how things
08:02 are faring as far as markets go.
08:04 And well as far as the Nifty is
08:06 concerned it is advancing by around 0.7%.
08:09 We're trying to move towards,
08:11 back towards the mark of 22,000.
08:14 But as I mentioned earlier there is a
08:16 lot of resistance there. Not only in the
08:18 cash markets but also in terms of your
08:20 options and the way things are panning
08:22 out because there is a significant
08:23 amount of open interest building up
08:25 around the 22,000 call. That said we're
08:27 still seeing advances and the truth is
08:29 that it's going to be a really hard one
08:31 to call whether or not we can in fact
08:33 see and expect the Nifty to move above
08:35 22,000 through the course of the next
08:38 couple of days. Thursday being this
08:40 weekly options expiry. As far as the
08:42 Bank Nifty is concerned it's, that's down
08:44 marginally. The Bank Nifty is down by
08:46 around 0.3%. But funnily enough the Fin
08:50 Nifty on the other hand which does have
08:52 a lot of constituents of the Bank Nifty
08:54 is marginally in the green. And as I was
08:56 mentioning earlier this is largely on
08:58 account of your Bajaj Fin Twins which
08:59 are also advancing in today's trade
09:01 which is why we have seen the Fin Nifty
09:04 remain largely flattish marginally in
09:07 the red at the moment. Well the question
09:09 really is that you know what, how are
09:12 things faring in the broader markets and
09:14 what are those stocks which are in fact
09:16 doing well in the broader markets. So
09:18 you know at least as far as the mid cap
09:20 and the small cap indices are concerned
09:22 as usual we are seeing gains coming
09:25 through and a lot of these gains are
09:28 today on account of something like a
09:30 Yes Bank. Up around 10.3% we understand
09:33 that HDFC Bank has gotten approval from
09:35 the Reserve Bank of India or rather HDFC
09:37 Bank Group has got that approval to
09:40 well increase take in Yes Bank. We have
09:43 Oil India which is up around 6.9%.
09:45 Petronet LNG is up around 6.2% as well.
09:50 A lot of oil and gas companies in fact
09:52 are doing well in today's trade. HPCL
09:54 is also the other one which is up and
09:56 about by around 5.5%. So we continue to
10:00 keep an eye on that one. Of course Fortis
10:02 Healthcare also advancing by around 6%
10:04 and on the losing end we don't have too
10:06 much to speak for. PB Fintech is under
10:09 pressure at the moment. It's down 5.8%
10:12 and we have weakness in Crompton Greaves
10:15 that's down around 4.6% and
10:18 Devyani International also down around
10:21 3.2%. Devyani International of course is
10:23 while it has seen a reasonable amount of
10:26 growth, the kind of growth that we are
10:29 seeing in the company is not close to
10:31 the kind of valuations it is trading at
10:34 at the moment. Well we continue to keep
10:36 an eye on that one. But let's move on
10:40 and talk about all the large trades that
10:42 we want to address in today's day of
10:44 trade. Tata Chemicals of course is
10:46 because of the earnings coming through
10:48 and we've had a curious move in Tata
10:50 Chemicals as well. Let's get in my
10:53 colleague Varsha to tell us a little
10:55 more about Tata Chemicals. Varsha good
10:57 afternoon. After seeing substantial
11:00 weakness early in trade we've seen
11:02 recovery of sorts for this particular
11:04 counter. Give us context here what's
11:06 going on? So hi Agam. So right as you
11:10 rightly said so we saw almost stock
11:13 dipping around 4.4% in early trade today
11:16 but it did recover. Now this is on
11:19 the back of despite company posting
11:21 weak results. So if you see the impact
11:25 on revenue was due to lower volume in
11:27 soda ash and pricing pressure across
11:31 various regions. Now EBITDA we saw
11:33 impact on EBITDA due to again pricing
11:36 pressure across the markets. If you see
11:39 a company did reduce its gross debt
11:41 which is at almost 5,900 crores and
11:45 important thing is US volume was lower
11:47 by almost 80,000 a metric ton. Now this
11:50 was due to planned shutdown and car
11:52 trade shortage which led to lower
11:54 absorption and increase in fixed cost
11:57 during the quarter. Rallis which is
12:00 one of their subsidiaries, the
12:02 domestic business in Rallis saw volume
12:04 and margin improvement but
12:06 international business we see some
12:08 challenges going there. Also if you see
12:10 container and flat glass sector
12:12 significantly impacted in Europe. Also
12:15 Latin America is also experiencing
12:17 slowdown especially lithium. So overall
12:20 if you see Agam, poor set of results but
12:23 we saw recovery in the stock. Enough Varsha
12:27 and of course this is certainly been a
12:29 very curious moment as far as Stata
12:31 Chemicals is concerned but let's talk
12:33 about Suvin as well. Suvin Pharma is the
12:37 one where has been under pressure today.
12:39 Okay so that's Suvin Life. We want to
12:42 address Suvin Pharma in two different
12:45 companies but Varsha can you tell us a
12:47 little more about what's happening here.
12:49 So if you see Suvin was down almost 10%
12:53 in early trade today but it did
12:55 recover and it's almost 6% down now. Now
12:58 again a company did post weak set of
13:00 results. Now if you see the reasons. First
13:03 is now this is the first result after
13:05 the new management. Now if you see
13:06 industry-wide inventory, destocking and
13:09 specialty chemicals and impact on a
13:11 COVID molecule in CDMO did affect
13:13 revenues and margins for the company.
13:15 Business excluding the COVID molecule in
13:18 nine months is a positive around 2%
13:21 but if you see COVID revenues in FY22
13:23 was almost 120 crore and company did
13:26 make a one-time investment inventory
13:29 provision of about almost 13 crore. Now
13:32 as per the management next few quarters
13:34 would be the next few next quarters
13:37 performance would be soft. Now this is
13:39 as per the management. Also if you see
13:41 one risk that I see in this company is
13:43 their molecule concentration. So
13:48 there's molecule concentration. So
13:50 lot of cash flows if you see comes from
13:52 molecule which will go off patent and
13:54 this can affect margins going forward. So
13:56 this is one risk that I see in Suvin
13:58 Pharma. If you see the margins of Suvin
14:00 Pharma is almost 40% currently in
14:02 December 23 is almost 30% now. Maybe
14:05 this is one of the reasons that you know
14:07 paid drugs going off patent is affecting
14:10 margins and it can affect margins
14:12 going further also. Right, right.
14:14 Varsha some valuable insights coming in.
14:16 Thank you so much for getting us those
14:18 as far as Suvin Pharma is concerned
14:21 and it's critical isn't it. It's also
14:24 come off in fact from its well you know
14:27 at least 52 week high and it's currently
14:29 under pressure down by around six and a
14:31 half percent as Varsha already mentioned
14:33 at one point of time it was down nearly
14:35 10% is recovered but well still well in
14:38 the red. One I very quickly address
14:40 what's happening with Chambal Fertilizers
14:43 because I believe we have earnings there
14:45 and we've seen a sudden spurt in that
14:47 stock which has now advanced by around
14:51 2.8%. Their net profit has risen over I
14:57 would say 43 odd percent on a year on
15:00 basis. We're seeing revenues come in at
15:02 around 4,348 crores but remember that
15:06 there's been a sharp decline in revenues.
15:08 On the other hand when it comes to
15:10 margins, margins have in fact seen a
15:13 sharp sharp up move because of which
15:16 you've seen that 42% growth in
15:19 profitability. Well at the end of the day
15:23 it's not so much about the revenues as
15:25 much as about the bottom line isn't it
15:27 and that's potentially the reason why we
15:29 saw a sharp spike in volumes and by
15:32 volumes I mean volumes for the shares of
15:34 Chambal Fertilizers in the last 10 odd
15:36 minutes and that's also explains that
15:38 strength which is returning to this
15:41 particular counter. It's not too far away
15:44 from its 52 week high. In fact it's 52
15:46 week high somewhere around 400 rupees per
15:49 share which it had managed to gain about
15:51 a month ago and actually yeah nearly a
15:55 month ago back in first week of January.
15:57 So we will continue to keep an eye on
16:00 that one. Profitability is what matters
16:02 and that's where Chambal Fertilizers has
16:04 shown up. So we continue to keep an eye
16:07 on that one. From there on we move on to
16:09 the other last trade that we want to
16:11 talk about and that's Rolex Rings. Now
16:13 this one has seen a little bit of
16:16 correction in today's day of trade but
16:18 remember Rolex Ring is also one of those
16:20 counters which has had a very very
16:22 strong year. Let's find out as to what's
16:25 really happened here. Let's get in Mihika
16:27 to tell us a little more about that.
16:28 Mihika. Yes so the stock did go to an
16:30 entry day low of 7.7 percent but in the
16:34 one month period it has showed strength
16:35 it's up about 15 percent. The volumes are
16:37 6.5 times the 30 day average and there
16:40 were more buyers than sellers actually
16:42 and the total volumes are at 1.55
16:45 lakhs. The major trigger was their
16:47 quarter 3 earnings and investor
16:49 presentation that did come out yesterday
16:50 where revenues were down 11 percent
16:52 year-on-year and margins did contract by
16:55 around 300 basis points and the net
16:57 profit was also down 30 percent. What
16:59 actually went wrong is that the Indian
17:02 bearing ring market segment saw headwinds
17:05 and the expected performance was much
17:07 lower than expected. There was lower
17:09 offtake from a major domestic bearing
17:11 customer of the company which had faced
17:13 up inventory pile-up issues and the top
17:15 three bearing customers as well was
17:17 facing a domestic slowdown which led to
17:20 the deferral of certain orders and
17:22 plans being commissioned by the company
17:24 and US as the company is also you know
17:26 involved in exports the US market was
17:28 also facing demand slowdown. However the
17:30 near-term outlook and for quarter 4 as
17:32 well is positive. The company does
17:35 expect healthy auto component demand
17:37 traction in both the domestic and the
17:39 export segments. It also guides a 15 to
17:41 18 percent revenue growth in FY25 and
17:44 this will be majorly driven by 20 percent
17:46 year-on-year revenue growth in the auto
17:48 component segment of the company.
17:50 Furthermore the company has commissioned
17:52 an 11.5 megawatt ground solar unit which
17:56 is expected to contribute and you know
17:57 help it improve the margins in quarter
18:00 4. They also have some key European
18:02 customers that they do expect a ramp-up
18:04 in the next six months to take place. The
18:07 only key monitorable are the Red Sea
18:09 disruptions that are going on with the
18:11 Red Sea crisis right now as 55 percent of
18:14 the company's nine-month FY24 revenue
18:17 mix were from the export segment of the
18:20 company. Yeah and exports are certainly
18:22 going to matter as much for Rolex rings
18:24 which continues to be under pressure at
18:27 the moment. Mihika thank you for getting
18:29 us those updates and insights as far as
18:31 Rolex rings is concerned and well buzzing
18:33 on volumes looking at weakness of around
18:35 nearly 5 percent as we speak. From there
18:38 on we move on to the final buzzer that
18:41 we wanted to talk about and that's
18:43 Triveni turbines. In today's year of
18:45 trade we have seen the stock jump okay
18:48 well it's about 18-19 percent as we
18:50 speak. Is it going to hit an upper
18:52 circuit? That's a wait and watch but
18:54 Anushi is going to get us more details
18:56 on what's going on behind the scene.
18:59 Anushi. So quite some strong volumes in
19:03 this counter if you see with the volumes
19:04 buzzing at about 22 times its 30-day
19:07 average now and the stock now crossing
19:10 its intraday high with about a 18 to 19
19:12 percent gain over the day. Now this was
19:15 on the back of the strong Q3 FY24
19:17 results wherein both the revenue pad and
19:20 the EBITDA all three of these measures
19:22 would beat its market expectations with
19:24 the revenue seeing about a 33 percent
19:26 growth. The same for EBITDA as well the
19:29 EBITDA also saw about a 33 percent uptick
19:31 whereas the net profit registered about
19:33 a 30 percent uptick to rupees 68 crore
19:35 compared to 53 crores it had made
19:38 last year. However the margins continue
19:41 to remain flat in the quarter with about
19:43 at 19.4 percent. So again some strong
19:47 numbers over here but I want to shift
19:50 your focus to the order book status that
19:51 the company had with the order booking
19:53 rising up to 27 percent at rupees
19:56 1,443 crore in the nine month period
19:59 compared to 1100 crore in last year.
20:03 Again from if you look at the order book
20:05 the main growth that we see is coming
20:08 from the export side which has seen
20:10 about a 60 percent growth at rupees 760
20:13 crore and with this the management also
20:15 expects if this sustains the growth in
20:18 the exports will lead to improvement in
20:20 margins going forward so definitely a
20:22 watch out on this one. So with the new
20:24 orders in place the total order book
20:26 stood at about 1575 crore again
20:30 registering about a 28 percent growth. So
20:32 all these factors do somehow make up for
20:36 the strong volumes that we are seeing in
20:38 the counter so definitely a watch out on this.
20:40 Absolutely, absolutely Anushika. Thank you
20:42 so much for getting us those updates there.
20:44 Well the you know the key takeaway from
20:46 what Anushika was telling us about is the
20:48 fact that the contribution from exports
20:50 has increased substantially now gone well
20:53 over the 50 percent mark. It's led to an
20:55 improvement in margins as well and of
20:58 course the prospects going forward look
21:00 certainly much much better as compared
21:02 to what Triveni Turbine has been used to
21:05 and we all know that Triveni Turbine
21:07 has had its own share of volatility over
21:10 the last few years. That said we continue
21:13 to keep an eye on that one but we shift
21:15 focus now to the political scene. Well we
21:18 have Prime Minister Modi who has kicked
21:21 off the poll campaign and is confident
21:24 that the NDA will surpass the 400 seat
21:27 mark in the upcoming polls while speaking
21:30 in the Parliament at the motion of thanks
21:34 to the President's address. Hear out what
21:37 he had to say.
21:40 I had told the Red Fort and I had repeated
21:44 it during the Ram Mandir Pranth Paksha.
21:48 I had said that the country should be at the
21:53 peak of prosperity and achievement for the
21:57 next thousand years.
22:07 The third thing is that we should have a
22:12 strong foundation for the next thousand
22:15 years.
22:17 Congress has always relied on a family.
22:28 They cannot think or see anything beyond
22:32 the family. A few days ago, Bhanumati's
22:42 family got together and started chanting
22:49 Ekla Chalo Ret. Congress people started
22:57 teaching them modern mechanics.
23:06 They must have understood what alignment
23:15 is. But I see that the alliance has been
23:24 broken.
23:28 If they do not trust each other, then they
23:51 will not be able to trust the country.
23:56 With that, we are completely out of time
23:58 on the show. Don't go anywhere. On the other
24:00 side, we get you India. Mark your clothes.
24:02 Stay tuned to NDTV.
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