Author: Harsh Doshi

Sanjiv Mehta of HUL

On Growth - We have grown our delta (incremental) turnover in the last six years by ₹12,400 crore. If it was a separate company, with ₹12,400 crore, it could perhaps be the largest FMCG company. If you look at our profits or Ebitda, we have more than doubled in the last six years. And these last six years, you have seen two consecutive years of drought, demonetization and introduction of GST (goods and services tax).

On Market Development - Market development is a science. What we call seed, accelerate and explode. Where the penetration is less than 10%, we seed it... once the penetration moves from 10% to 20%, we accelerate the development, and once it crosses 20%, then we press the pedal hard and explode it. So, it is a very clear science that we have built.

On Health Foods Drinks - If you look at our country, four out of 10 children are malnourished. Nine out of 10 children do not get the micro-nutrients that’s required and still the penetration of HFD in the country is about 25%. GSK Consumer Health have built a great category. This is a category of nearly ₹8,000 crore and, in that, they are by far the market leaders with great brands—Horlicks, Boost, Maltova, Viva—and when you look at them from any lens in terms of most trusted brands in the country

Source : https://www.livemint.com/companies/news/combined-business-of-hul-gsk-will-be-rs-45-000-crore-hul-chairman-sanjiv-mehta-1548006247197.html

Amit Kumat of Prataap Snacks

On Distribution - Our retail outlet reach has increased considerably from 0.5 million to 1.7 million currently and we hope to expand aggressively in next few years also. We would be present in 60% of the country right now. Big markets where we are very weak are Punjab, UP, Southern India, Himachal Pradesh and J&K. It will take another two years for us to have a pan-India presence.  We have acquired Avadh Snacks to take control of the Gujarat market. We would be needing another Rs 100-150 crore in next two to three years time for that expansion

On New Launches - Planning to take Avadh outside Gujarat to Maharashtra. We plan to start one plant in Mumbai. There is a sweet snack category where we are planning to launch three-four products in near future. Compared to savoury snacks, sweet snacks is a 50% to 60% higher margin product. Currently it counts for 3% to 4% of the revenue and we target this to be 10% of the revenue in next three years’ time.

On Growth Guidance - We hope to grow by 20% to 22% in next three-four years time.

Source : https://economictimes.indiatimes.com/markets/expert-view/we-hope-to-grow-20-22-in-next-three-four-years-amit-kumat-prataap-snacks/articleshow/67656045.cms

CP Gurnani of Tech Mahindra

On Impact of US Govt Shutdown and Brexit - I would not immediately react to this because I have seen that IT is a lag industry. It is not like change in food or oil prices changing your behaviour overnight. The impact, if any, is two to three quarters away. I would wait and watch and do my scenario modelling but many a times, it works out as an opportunity. Ultimately where is IT budget going? It is going to run the operations, to change the operations or to grow new businesses.

On Price Aggression - With discord computing or ARVR or data to AI kind of a solution, you are in a good position and more often than not, you are putting in the tail-end which is premium, which is not so easily available and you are also solving some of the customer challenges that the customer is willing to pay for.

On Digital Investments - After a certain point, digital will become hygiene. But for the next 18 months. we are still talking digital and after 18 months when 5G becomes centrestage, we will talk digital plus 5G.

Source : https://economictimes.indiatimes.com/markets/expert-view/after-18-months-5g-will-take-centrestage-in-tech-world-cp-gurnani-tech-mahindra/articleshow/67651467.cms

Madhu Alexiouse of Muthoot Capital

On Digitisation and Business Model – One of the driving force is spreading across the geography, we are now present in 20 states. Processes are digitally driven which have helped in reducing Opex. Opex to NII has come down by 10%. We have a unique business model where our flagship company Muthoot Fincorp which has 3600 branches cross sells two wheelers and contribute business to us at low cost

On New Products  – Muthoot Capital focus is on small ticket loans, we focus mainly on 2 wheeler loans and intend to expand to used cars and consumer durables. We have no plans to expand into SME and MSME lending

Source : https://www.youtube.com/watch?v=hjKC8zFdRYg

H.M. Bangur of Shree Cement

On Demand and Pricing – Prices are more or less stable. For last 4 years the profitability of the company is not increasing at all. Impression is cement prices go up only. Even if we see price rise of 3-4% annually, inflation is little more so profitability is impacted continously. Demand is good. Country is growing at 7.5% GDP. All India Cement demand is also growing at 7-8%

Source : https://www.youtube.com/watch?v=oM7Dk_LLIrA

Sundeep Sikka of Reliance Nippon AMC

On Opputunity Size and Consolidation in Industry – We believe that the opportunity is humongous. We have about 45 AMC’s. Even today only 2-3% of population is investing. As India moves from 2tn$ economy to 5tn$ economy the per capita income goes up. India does not have a very high social security system, so people will be using Mututal Funds for their retirement planning and other goal based. We believe the No. of investor in industry to be increased by 5 times in next 10 years. More than 50% of AMC’s are still in losses. The share of Top 10 AMC’s in overall AUM’s went up from 75% to 81%. So there is a lot of scope of consolidation happening in the industry.

Source : https://www.youtube.com/watch?v=SsAs_W2YEw8

Anil Agarwal of Vedanta Plc -

On India’s Mining Resources - Minerals are next only to oil on imports bill. India is richly endowed with natural resources, yet is not recognised or leveraged the way Australia, Brazil and China are. I wish India to quadruple share of mining industry, from 2.5% to 10% of GDP

Source : https://economictimes.indiatimes.com/news/economy/policy/view-address-the-mineral-imports-malady-in-resource-rich-india/articleshow/67635050.cms

Rajiv Bajaj of Bajaj Auto -

On Domestic business - We would have liked to be a little more successful in the domestic motorcycle market than we did. Every third motorcycle in Africa is a Bajaj. In India, our market share is now 21%...The time has now come after doing a good job overseas to do more here.

On Electric mobility - We believe strongly in electric mobility. It is a new technology and, therefore, there may be some shifts here and there. But our objective is to bring electric vehicles by 2020

On Current slowdown - There is a cycle in every business. But we are fortunate to be in a country which is the largest two wheeler market in the world. Our job now is to adjust the sails and ride out the wind. India is too big a market to fail.

Source : https://economictimes.indiatimes.com/news/economy/policy/no-wishlist-watching-budget-waste-of-time-rajiv-bajaj/articleshow/67627499.cms

https://auto.economictimes.indiatimes.com/news/industry/bajaj-set-for-foray-into-electric-vehicles-next-year-e-quadricycle-3-wheeler-on-anvil/67629312

Sanjiv Bajaj of Bajaj Finserv –

On ALM - There were a bunch of HFCs that were mismatched on funds and they got caught at the wrong end. They had short- term liabilities but did not have the assets. Clearly, if you have to grow, you have to match your assets to your liabilities. That is one of the first things you learn whether you are an NBFC or a bank. This is something that requires correction and RBI has taken some steps towards that.

On NBFC Crisis - Why did all NBFCs, HFCs fall in value by between 20 and 40% in a matter of a few days? This is systemic risk. Today. the top 10 NBFCs in the country each have AUMs of over Rs 10,000 crore and they are responsible for 30% of incremental credit going into the system. Consumer and SME growth in this economy has been helped by NBFCs. We u need to find a way to ring-fence them. It does not mean that you are going to create the wrong incentives but why did not banks fall because everybody knows that a bank license is a secure license under RBI. RBI will open up a window for liquidity. Why don’t you do that for big NBFCs?

On Banks vs NBFC’s - What is an NBFC? It is a license to lend with some limitations. A bank is the same but there are some differences. Why should NBFCs be associated with shadow banking? It is real banking. This is where some fundamental thinking and rethinking is required.

On Life Insurance - Life insurance clearly has evolved into pure protection of life but fare more importantly into both an investment product and a protection product. We are very bullish. We have transformed our business about three years ago and from there, we are showing steady growth in the overall top line, in the product mix as well as in the productivity across the different channels. That is growing well.

Source : https://economictimes.indiatimes.com/markets/expert-view/india-needs-to-have-a-decisive-government-that-is-also-inclusive-sanjiv-bajaj/articleshow/67628984.cms

Abidali Z Neemuchwala of Wipro –

On Achievements in Last Three Years - Our digital revenues are almost now one-third of our overall company revenues. We restructured some parts of our business which do not belong to the future, like we divested our data centre business. We combined our Middle East business with the global business -- all these steps started delivering results and good growth rate. We have the capability through the acquisitions and we are internally building things like Design, Cloud, Cyber Security, some of the new age services like Appirio in sales force and others.

On Improving the Quality of Revenues - The quality of revenue looks at balance sheet items like un-built revenues, collectables, how we address clients who may have credit rating challenges and stuff like that to make sure that on a sustainable basis we do not surprise markets with volatility or unpredictability. We have come quite far.

Just to give you one data point, about seven or eight quarters back, more than 27% of our quarterly revenues were un-built revenues. This quarter that has come down to about 13%. Our operating cash flows are ahead of our revenues and billing.

On Healthcare Vertical - Over the last two years. revenue dropped almost $270 million to about $100-110 million. It is a very significant amount of revenue hit and then there are some of the amortisation acceleration etc that we have taken. In the next couple of quarters, we will at least hit the bottom

On Efforts to Localise Talent in the US - When we started on this, we did take a little bit of a margin hit because this needs investments and we are kind of done with those investments. Now it has become a part of our operating structure, our cost models and we are able to deliver margin expansion because it has become a way of life. Now mid-level talent is still short especially in our large markets whether you look at US and UK and Australia, but by building talent and cadre locally in the markets and having established employer brand ahead of our competition, we do well over there.

Source : https://economictimes.indiatimes.com/markets/expert-view/leading-both-wipro-specific-and-industry-transformation-greatest-achievement-abidali-z-neemuchwala/articleshow/67642101.cms

IEX

• Q2 volume growth driven by increased demand in Gujarat, Maharashtra, Bihar, WB, Telangana, J&K
• Reason in increase of pricing was due to hydro and wind generation going down in September and shortage of coal
• Our transaction fees is not dependant on price of power but on volumes transacted
• Load shedding is the last thing that distributors engage in, hence demand for power will continue
• Any variation of fees in future shall be first approved by a regulatory approval, earlier exchanges were free to vary.

Link : https://youtu.be/q7RLg1wgg2g

Sobha Developers

• Revenue can be recognized only on completion basis as per New AS
• There are few private sector NBFC where we have seen they have not disbursed loans and they have assured that max delay is for 2-3 weeks
• Aiming topline of 1200 crs in this FY. Order book of 2300 cr on hand for contract manufacturing, will grow this business at double digit
• 1^st time buyers have been buying early in their age
• 2018 will be better than 2017
• Kerela is a great market for us, sentiment will revive when NRI returns in december season
• Gurgaon and NCR is genuinely growth oriented market in North
• Bangalore we have good land bank

Link : https://youtu.be/wmnWoRioGyg

Bata India

• SSGR is 9%+ and premium segment is 30%+
• Turnover growth was 15% where 16% growth in retail and 4% in non retail
• Portion of premium products will go to 35% from 30% at present
• Passing entire benefit of GST to customers
• Margins have improved by 1%
• All new launches will be mix of premium and retail

Link : https://youtu.be/JqT3gLPC4gM

Sandhar Technologies

• Margins pressure is due to commodity prices and increase in power and fuel cost
• Our new units are operating at negative operating leverage and as time passes will see much better margins from new units
• Industry segment grew at 13%, we grew at 20%
• PV segment grew at 5.1%, we grew at 7.9%
• CV segment grew at 37%, we grew at 35%
• Off highway grew ta 22%, we grew at 75%
• Diversification program has paid off well for us
• Just 3% of overall revenue is exports
• 50% of our foreign currency exposure is always hedged

Link : https://youtu.be/Q57YeC6j64g

V-Mart

• Festival demand has shifted from Q2 to Q3 which is the reason of SSGR coming down
• Expenses are growing and SSGR is flattish resulting in Ebitda loss in quarter
• Witnessing good festival season – will meet our expected nos. by year end
• Our stores are in Tier2 Tier3 cities and people buy only when they need and when there is festival. So during festival they come out and buy large quantities. Seeing demand rise in winter wear products from North India. Kids wear is growing more than other items
• 19 new store opening in H1, focussing on north and east states
• We approach clustered approach by opening new store which is 100-150 kms from our other stores

Welspun India

• After a long time entered in to double digit growth trajectory
• SPACES grown 20% in Q2
• Launched W brand towels in domestic market
• Christy sales via e commerce platform have gone up by 140%
• Expecting 1800 crs revenue from Welspun flooring in 2-3 years time (2x of capex)
• Double digit growth guidance for revenue and ebitda margin next year will improve substantially as current year hedges expire
• Capex will be 900 crs – 700 crs for flooring. No new spending on spinning and weaving.

Link : https://youtu.be/mSHvcIzKTDk

Welspun Corp

• 7% growth on YoY basis and 9% growth on QoQ basis
• Ebitda is 239 crs at sales of 269 MT
• Order book of 1.7 mn tonnes valued at 2 bn $ (highest ever in history of co.)
• 850k tonnes from Saudi, 500k tonnes from US and 300k tonnes from India
• Growth mostly coming from US mkt
• Made a provision of 28 crs rs for ILFS and other bonds.

Link : https://youtu.be/zoF1df0buTE

Bajaj Electricals

• Sales at 1598 crs vs 935 crs YoY , 71% growth
• PAT gone up to 34 crs from 18 crs, 79.6% growth
• Consumer product business growing by 25%
• EPC is growing by 127% because of orders from UP projects
• Consumer products margins are less as RM prices have gone up and Co. has not taken increase in prices, it will be taken in 3^rd qtr
• EPC margins – UP order margins are on lower side than other EPC projects
• Total order book for EPC is 7300 crs
• EPC topline by year end will be 4000 crs, 60% growth
• Consumer products topline will be around 3000 crs
• CP margins we expect to improve by 100 bps, EPC margins will be in same range

Link : https://youtu.be/G4yE78X8p_4

Castrol India

• Current quarter volumes increased 4%
• T/O increased 8% after putting in 3 prices increases in market
• Profitability was maintained despite 115crs increase in cost of goods
• ReLaunched some products with differentiated technology
• We have recovered 80% of cost of goods increase in 9 months
• No price hikes in this quarter unless huge change
• Reached 150k retail outlets and signed alliance with M&M
• Saw uptick in industrial volumes in Q3, 4% growth
• Synthetic products is a small part of turnover % in India as market is still evolving
• Lubricant demand depends on how much the vehicle moves and how many vehices are there in system and not so much on vehicles sales. Other thing that impacts is technology change. Replacement of lubricants are getting longer which means vehicles require lesser lubricants but they’ll require other synthetic products in which castrol is well positioned
• Long term volume growth of 5-6%

Link : https://youtu.be/tuW3Dq-Nabw

Escorts

• Diwali and Navratri are generally strong periods
• Already taken price increase two times, will be looking again for 1% increase after festive season is over
• In construction business, H1 is lower and H2 is better, guidance of 13% growth on full year basis
• Railways – Order book – 400 crs+ which will be executed within next 12-13 months – Guidance of 25-30% growth on full year basis
• Lowered margins in railways compared to previous quarters as we are entering new product segment. On a full year basis margins will be better by 200-300 bps
• In tractors we are able to pass the cost increases to customers but in construction we are facing difficulties
• Price realisations were better due to price hike taken
• Overall macro for rural is looking positive for next 2-3 quarters

Link : https://youtu.be/eOr_jKPHk3I

BEL

• Revenue growth of 20% for half year
• PAT depends on mix of services provided during particular period
• Ebitda guidance for full year around 17-18%
• Order book of company at all time high touching 50,000 crs
• Executable order per year will allow us to grow at 12% CAGR
• Will complete deliveries at 11200 crs in this year
• Expect order flow of 10000-13000 crs in FY 20

Link : https://youtu.be/xufvb85MJys