BC AXTEL
Saved by @Alex1Powell

AXTEL INDUSTRIES #Thread

Presenting my study for educational purpose 👇

@Atulsingh_asan - I know you have studied #Axtel in very detail your additional points/thought process/comments will be great addition to this effort !

1

 SSGR Analysis !

It gives +ive vibes for future growth. Further the Working Capital management & it's Free Cash Flow further strengthen the view.

SSGR (24%) > Current & Historical Sales Growth

2
#AXTEL Retained Earnings vs Market Cap vs EPS Growth

In last 10 yrs ->

📌For every Rs 1 Retained by Axtel it has generated 17x of Market Cap (Big Boost for shareholders)👍👌

📌EPS Growth has been 7% higher than RE growth 👍

3
📌Last 10yrs (incl TTM) in Nutshell (Screenshot) ->

Paying handsome dividend for last 3 yrs.

Remarkable improvement in Receivable Days & NPM.

4
OPM has considerably improved 13% to 23%.👌

Last 5yr Sales Growth has picked up. Though as per management due to Lock down they couldn't ship orders in Mar 20 but still their Recent Sales growth is 23%.👌

Profit growth 👌

5
Though #Axtel is in Machinery Manufacturing & supplying but doesn't seem much Capital Intensive.
Last 10yrs
Generated 66 Cr CFO
36 Cr Capex
13 Cr dividend Paid.
FCF of 30 Cr

6
Overall Management Compensation seems higher than normally allowed. Future Profit incr with same pace might make them compliant in a yr or two.

Only related party transaction which I found little dicey was Rs 42 lakh Fees paid to a company belonging to Promoter's brother.

7
📌Some Figures which Impressed me
(Avg Last 5yrs)->

Cash Conv Cycle 77
Sales vs Receivables 29
ROCE 24%
ROE 19%
Small Other Income compared to PAT

8
Promoter Holding is 49.95%. Though it seems low but if you notice public shareholdings there are relatives of promoters (Babbars & Pathak) holding 16% share.

📌So there is very only 14% shares left as free float (which actually available for trading).

9
Hold your thought from above👆
Check #Axtel Total no. of Equity shares = 1.2 Cr
Promoter holding 49.5%
Promoter relatives in Public 16%
Free Float -> 61 lakh

📌Hence only 61 lakh shares available for trading so small interest from few investors can move price crazily !

10
#Axtel has generated 30Cr of FCF in last 10yr on CFO of 66Cr.
FCF has been fluctuating (see red & green)
It has Cash of 6.5 Cr

Cash flow to Capex has been Impressive 👌

11
If I summarize #Axtel Fundamentals in layman terminology ->

Profitability -> Excellent.

Efficiency, Solvency, Growth-> Good.

Quality is Ok.

Fin Trend is turning Very +ive.

12
#Axtel manufactures various Machineries & Equipments for the clients in Food Processing industry like

Continuous Fryers
Big Bag Filling Pasta Machines
Vacuum Gravity Separators
Universal Mills with Plate Beaters
Continuous Khoa Making Machines

13
Axtel has mainly 3 divisions -
Snacks, Spices, Confectionary. Apart from packaging it does everything.

Space is mostly dominated by European & American manufacturers like Buhler, Rockwell, SPX, Russell Finex etc

📌Axtel has cost advantage against them.

14
Sales 81% in India, 19% Export.
Clients like
Cadbury
Nestle(India,Thailand,Bangladesh,Sri Lanka,Russia, Malaysia,Morocco,Vietnam,Phillipines)
Godrej Industries
Britannia
GSK Cons Hlth
CCL Products
Mondelez(India, Singapore, Vietnam)

15
In Ist Tweet 👆 above you will notice I have highlighted FY15 was disaster for #Axtel as a large order from a major client was cancelled.

Client Concentration is still little risk but after that setback they have been continuously diversifying in other FMCG.

16
No long term contract is another thing to watch out. For Example, Nestle contract is for 1 yr & gets renewed every year.

They don't have Intellectual Property rights on their design so need to continuous maintain their Quality standards to win more contracts.

17
Conclusion->
I feel it has potential to grow as its clients in food processing industry doing Capex which results in orders for #Axtel. Good quality & low cost advantage helping it to gain reputed clients.
Financial Trend is coming on track. Corp Gov needs some improvement.

18
#Axtel features in my various #Screeners

See details in below tweets 👇

19
#Axtel in my Mid&TinyBambooUniverse #screener

20
#Axtel in my LOW FREE FLOAT SalesProfitGrowthCashFlow&Safety #screener

21
#Axtel in my ROCE Grtr WACC LowDebt HighFCF ROE SalesProfit OPM #screener

22
#Axtel in my SIGN of Great & BEST Business #screener

.@Atulsingh_asan

23
#Axtel in my InvestableSmallCapUniverse #screener

.@Atulsingh_asan

24
#Axtel in my Magic_Formula_Screen_Sachin #screener

https://t.co/9zL6qOvomt

25
#Axtel in my BEST 2-FACTOR STRATEGIES #screener

https://t.co/JXHjrPB1gZ

26

More from Screening Stocks Enjoy 'My StressBusters'

Sachin K Rai
Sachin K Rai
@Coolfundoo
📢Superstar Shareholders Portfolio as of Dec-2021 (Latest Data available)

⚡️Arranged with Highest Holding Amount on Top !

So it's their Highest Conviction as per their Allocation/Action/Karma.

Hope this helps in your decision in picking companies during this downturn.


https://t.co/mb6nbXUNfv
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Screening Stocks Enjoy 'My StressBusters'
Screening Stocks Enjoy...
@Coolfundoo
My SCREENING TECHNIQUE Based #hypothetical #Portfolio
6th Upd - 26Sep2021

📍Purely based on my Financial Data Screening !

NO TIPS!
NO MEDIA!

📌#Screener Names in👇🧵summarizes Fundamental, Momentum, Valuation traits hence saves tons of analysis time.

@Vivek_Investor

1


Stocks & Screening Technique Methodologies !

@Coolfundoo 🌟25 , 22, 20, 19

2


Stocks & Screening Technique Methodologies !

@Coolfundoo 🌟18, 17, 16

3


Stocks & Screening Technique Methodologies !

@Coolfundoo 🌟15, 14

4


Stocks & Screening Technique Methodologies !

@Coolfundoo 🌟 14 (continued), 13, 12

5
SCREENERS , EQUITY
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Screening Stocks Enjoy 'My StressBusters'
Screening Stocks Enjoy...
@Coolfundoo
Q&A 118

Q-> #screener for Breakout on long term charts ?

You can also visit sites like https://t.co/5g2754nVXP for more ...

Few more to look ->

https://t.co/wBYhCapjZV

https://t.co/QpOOwnHn9T

https://t.co/cqmoAV4lHW

1


Collection of Good Scanners ->

https://t.co/xERUSnaXkg

2
CHART BO SCREENER
Screening Stocks Enjoy 'My StressBusters'
Screening Stocks Enjoy...
@Coolfundoo
Q&A 161

Read this 🧵to understand ROE, PE & relationship between them.👇

PE expansion to bridge the Gap (if any) between ROE & PE.

RT if you find this helpful.

1


ROE is PE's brother from another mother / Half-brother (Sautela Bhai)

@Atulsingh_asan

2


ROE & PE definition continued..

Keep an eye on Equations !

3


Establishing Relationship between ROE (profitability) & PE (valuation).

Replace Market Capitalization with Book value in Earnings Yield (or PE) we get ROE.

4


Understanding ROE & PE deeper with Dupont Analysis.

5
ACCOUNTING , ROEPE
Screening Stocks Enjoy 'My StressBusters'
Screening Stocks Enjoy...
@Coolfundoo
DrVijayMalik_ValueGuru_Checklist
Ist Upd - 05Jul2020

#Thread

A small tribute to @drvijaymalik on the occasion of Guru Purnima🙏

#valueinvesting #stocks
#SalesGrowth #OPM #npm
#CurrentRatio #DebtToEquity
#SSGR #MarginOfSafety #MaxPEtoPay #EarningsYield
#FII
#MaithanAlloy

1n


The Final Checklist for Buying Stocks !

Financial Checklist !

Taking Maithan Alloys as Sample Stock !

Tax Payout Shown in 1n (above).

2n


Valuation Checklist !

Earnings Yield > 10Yr G-Sec Yield. Higher the difference better it is.

Max PE to Pay calculated on the basis of Prevailing Current Interest Rate in the Economy (10Yr G-Sec Yield)

3n


Business & Industry Checklist !

10yr Cumulative PAT vs CFO. Ideally both should be similar or CFO may be little higher (Maithan Alloy Example)

Creation of Value for shareholders -
10Yr Increase in Market Cap > 10yr Increase in Retained Earnings (Maithan Alloy Example)

4n


Management Checklist & Other Business Parameters !

Most of this needs to be done manually. Take it as homework🙂

Maithan Alloy FII (1.87%) & Promoter Shareholding(74.99%).

Less FII better it is.

Check Change in Promoter Holding in last 3yrs (insider Buying) in 1n (above)

5n
VALUATIONSCREENER

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