Investment Hypothesis in CPaaS companies
:Crossed the technology adoption chasm
:Huge addressable opportunity - Industry growth estimates 30-50%
:Profitable Unit Economics, Cash Generating, Incremental Cost Low
CPaaS growing at 40%
Indian Investing Conclave Day 1 @IIC_2020
:Route Mobile
:Philip Carbon Black
:Borosil Ltd
:Arvind Ltd
:Hawkins Cooker
:Repco Homes
:Shaily Engineering Plastics
Investment Hypothesis in CPaaS companies
:Crossed the technology adoption chasm
:Huge addressable opportunity - Industry growth estimates 30-50%
:Profitable Unit Economics, Cash Generating, Incremental Cost Low
CPaaS growing at 40%
:Applications served by route mobile - Facebook, Instagram, Whatsapp, Google Pay to name a few
:Route mobile platform used for : 2 factor authentication, Notification for customer engagement across portfolio of apps
:Scaled upto 1200cr of revenue from internal accruals
:Huge runway for growth
:Multi geography and Omni-Channel presence
:Cash available for M&A
:Scope of margin improvement
:Demonstrated ability to move up the value scale
:Indias largest carbon black manufacturer
:Where is carbon black used, Tyre Rubber(73%), Non Tyre Rubber (20%), Non Rubber Speciality Carbon (7%)
Industry Size & Capacity Addition
1.3 Million Tonnes capacity and PCB has 43% market share
:Launched 40 grades of speciality carbon
:FY 16 Sales : 4825 MT, FY 20 Sales : 19,378 MT
:Diversified Application : Consumer appliances, Packaging Industry, Food Packaging, Agriculture Pipes, Construction Pipes, Construction pipes
:Company has spent 40cr over the last 3 years on R&D
:Company having almost all tyre companies in India as their customers
:Almost all major tyre companies to increase capacities over next 2-3 years
Segments
:Glass & Microwave (Market Size 5.5 Bn, Growth 10%)
:Storageware (Market Size 7Bn, Growth 15%)
:Opalware (Market Sie 6Bn, Growth 15-20%)
:Kitchen Appliance (Market Size 90 Bn, Growth 10%)
:Cookware (Market Size 40 Bn, Growth 20%)
:Acquired Klasspack to leverage its reach with pharma companies & expand its glass expertise into everyday consumables
:Total Addressable Market Size : 10,000 cr
Borosil Vs Glassco (Laboratoryware)
:Leveraging on strong brand equity
:Protected its leadership in glassware segment
:Consistently expanding its products outside glassware
:Pharma Packaging is set for substantial growth
Size of Opportunity
:Kitchenware market size : 15000 cr
:Hawkins addressable market size : 2500 cr, growing at 6%
Entry Barriers
:Duopoly market in cooker
:High supply chain costs
:New entrant to fight on pricing with higher costs and working capital
:Introduction of LPG (Ujjwala Yojana)
:Nuclearization of families
:New product launches
Hawkins Vs TTK Prestige
Business Segment
:Textiles - Denim, woven, voiles
:Technical Textile - Advanced Material Division
:Waste water treatment (Through Arvind Envisol)
:Suitings, Shirting etc.
:Demand for advance material growing at 10% CAGR
:Exports constitutes of 50% of total AM revenue
:Targeting to reach sales of 2500 cr in AMD by FY24/25
:Huge potential to generate valuable IP and has great domestic and export growth potential
:Domestically textile is expected to grow at 8-10% over next 5 years
:Rapid shift to branded apparels in India
:Possible textile orders from clients moving out of china
Revenue Segment
Lending nature
:Affordable HFC (12 l ticket size)
:50% are non salaried
:Lending rates in double digit
:Location : Small towns and outskirts
:Best in class RoE player with PSU valuations
:Available at extremely cheap valuations
:New CEO is focused on minting balance between risks and growth
Valuation Study
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Many of you have seen the famous Westrum Organizational Typology model, so prominently featured in State of DevOps Research, Accelerate, DevOps Handbook, etc.
This model was created Dr. Ron Westrum, a widely-cited sociologist who studied the impact of culture on safety
Thanks to Dr. @nicolefv, I was able to interview him for an upcoming episode of the Idealcast! 🤯
It was a very heady experience, and while preparing to interview him, I was startled to discover how much work he's done in healthcare, aviation, spaceflight, but also innovation.
I've read 4+ of his papers, so I thought I was familiar with his work. (Here's one paper: https://t.co/7X00O67VgS)
I was startled to learn he has also studied in depth what enables innovation. He wrote a wonderful book "Sidewinder: Creative Missile Development at China Lake"
Dr. Westrum writes about China Lake Research Labs: "its design and structure had one purpose: to foster technical creativity. It did; China Lake operated far outside the normal envelope... Sidewinder & others were "impossible" accomplishments,
I love this book because it describes traits of organizations that routinely create and maintain greatness: US space program (Mercury, Gemini, Apollo), US Naval Reactors, Toyota, Team of Teams, Tesla, the tech giants (Amazon, Google, Netflix, Google)
This model was created Dr. Ron Westrum, a widely-cited sociologist who studied the impact of culture on safety
Thanks to Dr. @nicolefv, I was able to interview him for an upcoming episode of the Idealcast! 🤯
It was a very heady experience, and while preparing to interview him, I was startled to discover how much work he's done in healthcare, aviation, spaceflight, but also innovation.
I've read 4+ of his papers, so I thought I was familiar with his work. (Here's one paper: https://t.co/7X00O67VgS)
I was startled to learn he has also studied in depth what enables innovation. He wrote a wonderful book "Sidewinder: Creative Missile Development at China Lake"
Dr. Westrum writes about China Lake Research Labs: "its design and structure had one purpose: to foster technical creativity. It did; China Lake operated far outside the normal envelope... Sidewinder & others were "impossible" accomplishments,
I love this book because it describes traits of organizations that routinely create and maintain greatness: US space program (Mercury, Gemini, Apollo), US Naval Reactors, Toyota, Team of Teams, Tesla, the tech giants (Amazon, Google, Netflix, Google)
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I’m torn on how to approach the idea of luck. I’m the first to admit that I am one of the luckiest people on the planet. To be born into a prosperous American family in 1960 with smart parents is to start life on third base. The odds against my very existence are astronomical.
I’ve always felt that the luckiest people I know had a talent for recognizing circumstances, not of their own making, that were conducive to a favorable outcome and their ability to quickly take advantage of them.
In other words, dumb luck was just that, it required no awareness on the person’s part, whereas “smart” luck involved awareness followed by action before the circumstances changed.
So, was I “lucky” to be born when I was—nothing I had any control over—and that I came of age just as huge databases and computers were advancing to the point where I could use those tools to write “What Works on Wall Street?” Absolutely.
Was I lucky to start my stock market investments near the peak of interest rates which allowed me to spend the majority of my adult life in a falling rate environment? Yup.
Ironies of Luck https://t.co/5BPWGbAxFi
— Morgan Housel (@morganhousel) March 14, 2018
"Luck is the flip side of risk. They are mirrored cousins, driven by the same thing: You are one person in a 7 billion player game, and the accidental impact of other people\u2019s actions can be more consequential than your own."
I’ve always felt that the luckiest people I know had a talent for recognizing circumstances, not of their own making, that were conducive to a favorable outcome and their ability to quickly take advantage of them.
In other words, dumb luck was just that, it required no awareness on the person’s part, whereas “smart” luck involved awareness followed by action before the circumstances changed.
So, was I “lucky” to be born when I was—nothing I had any control over—and that I came of age just as huge databases and computers were advancing to the point where I could use those tools to write “What Works on Wall Street?” Absolutely.
Was I lucky to start my stock market investments near the peak of interest rates which allowed me to spend the majority of my adult life in a falling rate environment? Yup.
