JSW Cement, All Time, Connplex, Star - August 2nd Week IPOs : Apply/Avoid? Primary Market Chatter

0:00 Hey everyone, welcome to primary market chatter August second week IPOs. This is part one. Although next week come IPOs but we were not prepared. So we thought we'll do part one and part two. Part two blue stone but part one is where we are doing just four IPOs today. So should be a short uh session and also what we wanted to do was just be conscious of uh the times the evening time also we are trying to see if we can figure out a better time. So we are doing today morning but again nothing is sure where we'll continue but we'll definitely be uh posting them on our YouTube uh these spaces. So if you haven't joined our YouTube until now definitely go ahead and uh do that. The link is in the pinned comments. So let me just start with uh this week's IPOs. Um before I

0:46 actually set up the agenda for the day, just want to highlight a couple of things which almost everyone knows by now, but I definitely want to make sure and highlight in bold, italic and underline that we are not say we registered the session list. None of this opinion what we share is uh qualified opinion. All of this is what we are planning to do. Do not take this on face value due definitely correct. talk to your uh financial advisor or understand read the RSP etc and then take a decision. Uh we would not be liable for any profits or losses. So it's your decision end of the day. So definitely you do you. Uh what we do is we just tend to share what we feel about the company and this is especially important considering last week where some of the uh listings where we were

1:33 positive on didn't open well. some of the listings where we were negative opened very well and did give a follow-up run up but that's something which is market right not everyone can be right all the time and we don't pretend or predict that we are right if we are right then we wouldn't be doing this this is just our read uh so definitely uh you do you if you feel that you have a counter opinion to what we are saying definitely express it out we would more be more than happy to voice it out reason it out and then probably try and find out but again even if we do there's never always a right answer right these are opinions market works on opinions and not facts so you do you is what I'll kind of uh leave with but what we have also felt is that

2:20 it just leads to a slight dilemma where we are giving verdict or something like that for IPS so we'll probably try and avoid doing that so what we'll do is we'll focus a lot more on facts which are like hard facts in terms of like and then probably softly towards the end we'll mention that what are we planning to do I would again say don't do don't if you are not convinced do not focus on what are we planning to do try and focus more on is it right is it wrong have your opinions and then this is just a base for for everyone to figure out and we are also learning with every day right we are learning from you guys you are learning from us and vice versa like it's a like we don't pretend to be experts in any possible way like it's a

3:07 day one of learning for me at least. Uh second thing as I said YouTube channel join there's also a membership feature on there. So what we'll be doing is that we'll just be interacting a lot more on those membership uh tabs member only tabs and we would also slowly transition these videos to member members only. We still want to see how to do that but he'll slowly transition these videos as well there in some way shape or form. So there's more to come on membersonly content as well on membership. So see if you want to uh take membership of the channel because that also helps us in order to uh monetize the effort that we are kind of putting in. But with that let me just quickly set up the agenda for the day. We'll be covering two companies in on SME uh star imaging and

3:53 uh conflex and then we'll be covering two mainboard companies all time uh plastic and JSWC. So maybe without wasting much time uh let me move forward and set up star imaging and path labs incorporated in 2004. Company is a healthcare company providing diagnostic services across a wide range of medical tests. specializes in amazing services such as X-ray, ultrasound, CT scan, MRI and lab test including blood test, urine test and other specialized diagnostics. So healthare company diagnostic services or provide so uh radiology plus uh pathology which uh mixture we'll try and understand more about the company in terms of the IPO

4:39 it's a big size IPO 70 IPO all of which is a fresh issue market cap 5050 around 70 so around 30% if I'm not wrong purchase financial revenue 84 CR PA 16 CR so 16 CR P 250 crores market cap so around uh 156 P if I'm not wrong yeah and in terms of the LM the LM is share India capital so with that over to you uh Sachin to talk about star imaging uh am I audible yep uh loud and clear yep yep perfect all right so uh uh actually the issue also has an offs I will talk about it So just to clarify that so uh star

5:26 imaging is started in 1978. It was a family business run by Mr. Pawan Gupta who is the current uh person leading the business and now it has transitioned to a private limited company and a publicly limited company. So they both have NABL and NABH accredited uh diagnostic services and they offer both uh comprehensive pathology and radiology services X-rays, ultrasound, CT, MRI etc. Uh currently they operate around 23 centers. uh four are in Delhi. Uh two of them are equipped with CT and MRI machines and other two are uh at planned level of upgradation. Uh 17 to 18 centers are in Uttar Pradesh. One additional center is in NASC also and that is part of their B2G expansion that they're trying to do. Uh they also have a small minor contribution from one

6:11 education and training subsidiary uh which is very minimal around 11 to 10 12 lakhs revenue per year. So currently 80% of the revenue comes from pathology and the rest 20% comes from neurology, cardiology etc. In that uh uh uh division uh around 38% of the revenues is from B2C uh direct to consumer uh getting to local patients etc. and 57% of the revenues is from B2G which are long-term contracts uh generally in tender and via PBP model public private partnership 7 to 12 years of uh duration. So uh this this is primarily in Uttar Pradesh and Delhi and this involves high-end machines that are actually uh installed in the hospitals only. So around 20 machines they have installed

6:56 in around 18 to 20 locations and the rest 5 to 10% is the B2B segment. So with that uh in that they have tie up the local nursing homes, hospitals etc. So generally for the capex that they do for a center uh it requires around 10 to 20 crores of amount. uh for B2G uh it takes around two years uh for to get the payback of those machines uh and in uh higher end segment like 20 kores plus uh it can take more around 3 to 3.5 years uh they generally go for new machines because that is part of the tenders that they bid for in some cases they also go for refurbished machines which is from Europe and Japan etc which cost lesser than the uh newer ones. So in terms of revenues uh if we take just for the CT

7:43 and MRI machines uh that uh if the if those machines can do around 3 CR to 3.5 CR per year uh that leads to break even in the timelines that is above mentioned like 2 years it takes for break even and 3 year uh per revenue it it will lead to break even of those machines and in B2G center since the capex is high so break even is also higher break even timeline is also higher so Mature centers generally generate around 10 to 15 cues of revenue per year which is growing at around 20% per year and US centers grow around 35% per year. They bid for around five government tenders in the in that they won two and two tenders were canceled and in one of the tenders they were L2 that is just second best to the

8:28 uh lowest bidder. So they haven't planned any franchise model as of yet so to penetrate more into other geographies. Coming to their financials, uh FY23 they did 50 C 58 CR of revenues at 10% debita. Uh there was slight dip in from FI22. This was because of the postcoid normalization and that le led to this dip in FI23. In FI24 they did 79 CR of revenues 30% AIDA. In FI25 uh they did 84 CR of revenues and uh slightly increase in AIDA to 35%. And the PAT is around 19%. This is primarily due to the reduced testing expenses they uh catered to and there was also lesser purchases and since they did no new capex on new centers. So FI25 PAT is slightly better than FI24.

9:15 In FY26 they are looking to upgrade their existing facilities. No new centers are being opened bus but just machines are being operated in two to four new centers like in Noa and Gurugram. And they are al also looking for inorganic growth if and when any prospects come alive and as per their working capital estimates they are suggesting for around 40 to 40% growth. Uh coming to the risks uh there is competition intense competition in this uh segment uh with uh local hospitals also integrating inhouse diagnostics and online platforms also coming up with low cost pathology test and radiology test. Payment delays uh especially in the uh B2G segment is uh quite high around 6 to 7 months they take for payment. So that also means higher receivables and

10:00 negative impact on the cash from operations. uh coming to their IPO use around 12 CR is for repayment of debt uh with 9.5% of rate of interest. 5C cr is for upgrading existing centers with new machines and 25 CR is for working capital requirements. uh coming to the pricing uh it involves a large 20% OFS and in terms of pricing it's around 15 to 16 times trailing and around 11 times on forward basis on EVA beta basis which is a better metric for these centers and uh diagnostic chain operations it is around 10 times including the debt repayment that will that they will do from the IP proceeds uh the exact peer inme can be Chandan Chandan which recently listed and has moved up very recently in terms of share

10:46 price so it trades near 25p and 14 times EV AIDA uh has a similar growth outlook but has more number of centers around 40 to 42 centers and their new uh center is also coming live in Jani Puram uh which is under construction and they also have a hospital and pharmacy business so that generally means more volume for this diagnostic business of Chandan Healthcare. Uh coming to the lead manager share India which has decent reputation anchors included invicta continum continum and nan was also there uh which took a majority of share the RHP drafting is uh poor because at places it's uh it is for some places it's mentioned as increase when actually it's uh it has to be mentioned at decrease like in revenue and cost of

11:31 expenditure cost of material sold etc and many sections are not updated to March 25 yet it it dates back to se September 24 only and the company also has some related ent entities which are into diagnostics but they are mentioned as less comprehensive than star imaging don't know the actual thing about that but just they have mentioned it uh more use of more IP proceeds for from the OFS to set up more centers and diverse geographies could have helped but uh it is what it is for now so that was about star imaging perfect thank you thank you uh sachin the question from what I understand it's a very old company right so why has like growth has been rather slow right for like what is changing now uh if you if the promoter mentioned anything second

12:17 is it majorly only in Delhi and UP or is it also present in Bombay Mumbai etc uh and third question how much of the business is radiology versus pathology like radiology or pathology because pathology from my understanding is very low mode now right like anybody can open a lab yes so like Yes uh the radiology is 80% so that is something to benefit and the pathology neurology cardiology etc is 20%. So the they have upper hand there uh for the time that they took to transition to current state uh because this was a family business earlier which then slowly transition to partnership proprietorship and Mr. Pawan Gupta is actually not a doctor but he's a becom graduate. So he's taking time to understand the business but slowly

13:04 transitioning it to the current state. So that is why it has took some time but they are trying to see how and when to figure out and to move apart from the regions that they already operate. So primarily they were in lily op and now to move ahead and from to other regions as well they are coming for the IPO and to expand their presence. Got it. That is very helpful. With that we have covered star imaging. Just highlighting star imaging is closing on 12th. Then complex cinemas is closing on 11th and then all time and jwc are also closing on 11th. We will talk towards the end key in terms of our IPL. But that is what the review of star imaging was. So with that we can probably move forward and talk about the second company which is complex cinemas.

13:50 Setting it up incorporated in 2015. company develops theaters and enters franchisee agreements for film exhibitions and distributions sharing revenue at various franchise cinemas all under the brand name complex. So basically cinema theaters small size majorly in suburban and rural regions tier 2 cities that is where complex is developing it is more like let's say for tier two cities if I had to like say something like that setting up the IPO it's a 90 cr IPO IPO all of which is a fresh issue so 90 cr company raised curry at a market cap of 338 crores so around uh 30% 29% dilution fi25 financials about revenue 97 crores or

14:35 pat 19 crores so they're coming at like 17p if I'm not wrong 17p trailing something like that uh lm lmb line capital so with that over to you Rohit to talk about complex thanks Manish uh so complex is a cinema brand so it's a little bit like your PVR what PVR is a multiplex complex is trying to do that for uh these small scale cinemas but they are the brand they are the customerf facing brand they're a new age cinema for focused on tier 2 tier three towns uh the logic is that in India which is that people keep talking about India right is an ABCD market astrology Bollywood cricket and uh devotion I guess uh that B of Bollywood which is which is so central

15:21 to us and how movies are so central to us the penetration of cinemas in India is actually surprisingly low compared to our population we have around 10,000 screens in India uh versus whatever 1.4 4 billion population for a similar population China has 70,000 screens US with one/ird the population has 40,000 screens so and while we are still at just 10,000 screens so the idea is that we have the interest and the enthusiasm for movies and content but not as many quality theatergoing experience so that's the thesis with which these promoters started this business uh they operate in a franchise model which is again very different from what a say PVR does which operates in a asset heavy model where they get a franchise to uh uh set up the

16:06 majority of the cinema. What these guys do they provide some very specific things which includes the projectors, the screens and certain some of the technology aspects but everything else which is all the interiors and the civil work and all of that gets done by the franchise and then they share the revenue where 80% of the revenue once you take out the uh money that goes to the producers and the distributors of the film and once you take out taxes 80% goes to the franchise and 20% is kept by complex. So that is simply speaking their model. So they are trying to build an asset light uh cinema chain like an oo let's say for uh cinemas using the complex brand. Uh today typically for a franchise it would cost as for the promoters it would cost around 2.5 cr as their upfront expense. Uh I'll just question this number later when I look

16:52 at the P&L or when I come to the PN but at least based on what they say it will cost around 2.5 cr. Uh the company then invests another 50 lakhs typically for these LEDs, projectors and and servers and and stuff like that. Uh and with that in about a 100 days you can set up a three-screen 250 seater cinema. Uh the idea behind this 250 seat is that that's the typical occupancy of a multiplex. So if you start with 250 seats obviously you will also not be fully utilized but you can probably operate at 30 35% maybe 40% utilization which is what these guys gun for. I think in one of the interviews he mentioned that there are 30 35% uh occupancy rate. For PVR for example the number is 25%. Uh they operate three types of cinemas. They operate uh three categories let's say like an entry level, a mid-level and a luxurious level and they've said that

17:38 they want to focus more on the on the luxurians as well as they go forward. Uh they today have 66 screens across 25 uh cinemas. Uh so 25 locations and they try to choose their locations also in places where there is a good population but there is no screen or the screens are very old very you know local kind of screens. They try to uh find a franchisee partner over there who's willing to invest and they uh as per them they have another basically for the next two years they have enough screens already signed up with lois which is from a plan perspective they want to take the 66 screens to six plus 60 more screens for this year and plus 75 screens for next year. So that will take them to nearly 200 screens by the end of

18:23 FI27. Of course execution it's quite a jump from what they have done so far but that at least is their plan and they say that they have uh the uh lois for these they make the revenue I think like I mentioned uh they what complex does is they actually take all of the revenue then give back 80% to the uh uh to the partner at least for majority of the revenue sources they'll take all of the revenue so the ticket booking will come to them the FNB booking all of that uh will come to them so all the money comes to them and then they keep their cut, they give away the cut to the uh distributors and then they give the rest back to the uh franchising. So their revenue sources are as you'd expect it is stuff like FNB uh uh the tickets obviously uh advertising the one that when you go to a cinema and you get

19:08 really irritated in the middle where you have non-stop ads all of that revenue they will get or they'll keep like 20% of that. Uh they also do a lot of corporate bookings because the size of the theaters are smaller. It's perfect for the 6070 uh you know corporates uh 6070 uh member corporate team events. Uh they said that they did almost 300 of that just in the last year. Uh they do some collaborations. They do for example they have a collaboration with Coca-Cola. So that'll obviously share some revenue for them. Uh convenience fees is another one where a book my show would charge a convenience fee and part of that convenience fee will also come to the uh to Complex. Even the convenience fee that obviously Complex has on their own app will also come to them. So they've it looks like they've actually thought of everything. In fact, there's more. He mentioned on the call that on one of these calls that they are

19:55 even uh on Swiggy and Zumato where you can order food. So it's like a cloud the cloud kitchen part also people can order popcorn. If they want to watch something they can order a complex popcorn. I mean some of these are still small but it feels like they've thought of every possible avenue to monetize uh their business. Uh when you come to their numbers uh last year they did about 95 cr of revenue with uh 20 cr pat let me just double check the pat number uh they did 19 yeah 19 cr pat last year uh which is quite a jump and feels quite high and even I couldn't fully understand why their pat margin is equal to you know if 100% of their revenue they're measuring and 20% is what they

20:41 keep and the 80% goes to their partner that means the rest of their revenue. So you can say that is what's happening in FNB, that's what's happening in tickets, that's what's happening in advertising and so on. That means the rest of their revenue so uh which is about half of their revenue which comes from construction of the uh of the cinema. That means they have very very high margins there. Uh which I'm which did not sit correctly with me. So I'm not too sure sure about that. Uh otherwise rest of their P&L looked okay. The balance sheet looked fine though it will probably get worse and I and I'll come to that why I'll come to why. So their funds are being used for three things. One is they're using it to set up an office. They're spending almost 14 cr to set up an office. They've justified it by saying that that office will also have like an experience center and a place for new franchises to come and see

21:26 like a an exemplar uh uh you know cinema. So that it it it helps in the sales process. But I still felt 14 cr to buy a large 70 80,000 foot office seemed excessive. uh apart from that they're doing some capex which is where they purchase some of the technology the uh you know the projectors LED and so on. U today they take it on rent if they purchase it it'll obviously be far lower cost so that is one thing that can improve their margins and then of course working capital. So if you see their growth, they've been adding 15 to 20 screens for the last 2 years. Uh now suddenly they want to add 60 screens and one of their contentions is that they obviously as an unfunded company, they have to wait for the franchisee to bring in the money and only then can they set up the the cinema. Now with their own working capital, they can do it and

22:12 they'll obviously have more receivables from their franchisee partners, but they can use their own working capital to speed up the uh setting up of the next uh you know 60 and 75 screens. So hopefully that is a genuine thing and you know the cash flows will not go for a toss in a negative sense and that they they do eventually receive this money but yeah they're certainly going to be a lot more aggressive. Uh now I mentioned that they did 95 cr revenue roughly half that revenue was from all of these tickets FNB advertising and so on but the other half is from uh fit out of the uh actual cinema. Now here last year they added about uh 20 odd screens which is say 78 cinemas but they did almost or let's say 10 10 new cinemas they added last year. Uh

22:59 they spent or they've received almost 47 48 cr in the fitout fees which they have mentioned in the in these calls that that actually should be around 2.5 cr per cinema. So I mean that number is not sitting where he said 45 cr or he said 2.5 cr if they've added 10 cinemas that number should be 25 cr not 45 cr. So that is one thing which again I'm not able to understand is it to do with some cinemas the revenue coming at the end they would have opened on the 1st of April and then the revenue gets recognized. I don't know if there's some uh something to do with revenue recognition here, but if you look at it over the last four years, including the DRHP, the total number of cinemas and screens they've added and if you divide that by the total amount of money they've received from this uh fit out, which is their construction of the

23:44 cinema, that fee it comes about 3 1/2 cr per cinema. I have just assumed that if they're adding 60 screens if they're adding 20 new cinemas this year and they charge 3 cr uh you know from the fit out they can generate around 60 cr from the fit out they should be able to generate another 55 60 crores from tickets because they will have that many more screens and probably another 20 cr from other categories and I feel that this year they should be able to do around 140 to 150 cr which also ties in with their working capital calculation maybe they can do more but I I'm just assuming this is like A good case for me if the company delivers executes they can grow another 50 60% this year probably another 30 40% in the year after this also which is in my view very good uh

24:30 this company is coming at 18 times 17 something 17.7 or something on a trailing basis and it's coming at 13 times AIDA now the natural question is how does this compare with PVR of course they're not a direct comparable PVRS PVR it is also a multiplex but and and they don't do any of this construction ction revenue. They are an asset heavy model. Very high depreciation. So they're not even profitable. Forget this thing. But if you look at their multiples on sales and EIDA, PVR is at 1.7 times sales and 10 times EIDA for an asset heavy uh business. Uh these guys are coming at 18 times PE because they're asset light and 13 times uh EIDA. Again, I would give that because they're asset light. That's okay. Uh with also the promise of much faster growth and a very differentiated model which is and and growing from a

25:16 very small base. Uh the main risks for this business would be the content which I think has kind of gotten solved now thanks to co I think people have started making a lot more content for OTTs content for movies like that that cycle has come back but obviously that shift to OTT is is is a risk that people have but I still feel that the cinema experience is different uh and everyone will have their own view here and of course a fundamental COVID type shutdown is obviously catastrophic uh but yeah you can't you can't really that that that's not just a problem for this business. It's it's exacerbated for this business. The promoters also I thought were quite capable good experience in the past. This is purely read based on interviews. I don't have I don't have any additional on ground info. If anyone does please do share in the comments but at least based I saw two three

26:02 interviews and I found that good mix of reality background franchise background for one person and the other was from film and distribution. Uh and they seem to really know what they're doing and seem to be quite passionate about this. uh good anchors also I think Sani which is Mulagarval is the largest anchor uh 20 30 30% I think of the anchor the rest of the anchors are also pretty good in preip so Dr. Faruk Patel was there the KP group uh promoter he was in the preipo. Couple of other listed company promoters are there in the preipo. So overall very strong interesting business. This is not the kind of business that will list and run. It gives me a little bit of GC hotels vibes which also I remember we were quite bullish on uh and it listed absolutely flat fell down but today it is almost 70

26:48 80% above uh the IPO price and listing price just because the business was fundamentally strong. This also gives me that kind of vibe again more asset light kind of business uh with good growth projections if they do deliver this this company is in my view reasonably valued uh beyond that yeah I'll wait for the end of the uh end of the call for my for whether I'll apply or not. Got it. Thanks. Uh I'm very confused on this company. I'll tell you why. um the sector in itself while GC hotel was in a great sector right hotels etc are poised for growth cinema I don't know maybe that is because we belong to let's say urban consumption areas where that cinema

27:34 experience is going down because of which let's say a PVR is kind of uh like uh struggling but for a tier 2 tier three city it still makes sense to have those cinema centers which are small so I feel that this would like if you're betting on this company you're betting against the trend like against the sector per what I feel because I I just feel that that sector is poised for disruption it will disrupt you can't keep having these Bollywood celebrity larger than life structure for too long now is what my idea is so what do you think about that part see we are I I don't think the Indian market is there yet like we We consume content everywhere. We are a

28:20 content hungry country. We'll consume it on YouTube. We'll consume it on our phone, on our laptop, on our TV and on the in the cinema. Cinema you have to view it as an experience. So it'll be for certain like I I know this what is this movie that is coming there are some three four people in my society who have booked the 430 a.m. show first day first show. It was a sneak. Now that is obviously an experience you are not going to talk about if you are watching it on Netflix right so there is an experience angle with uh cinemas I think that still cannot be beaten like I watched the F1 movie recently and I would have regretted it if I watch it watched it on TV versus watching it on versus versus watching it and if I missed it in cinema it's an absolute cinema experience so I think there's a difference it suits a

29:06 different class I don't think it is going to go away there was a period 2 years ago 3 years ago where my own cinema watching had come down quite a lot and it has gone back up because the experience is different. You don't get that experience actually. I'd say we are just all consuming more content. We're not removing cinema from our life. We're just consuming a lot more content at other times. That is my personal view. So, and and then when you take that to a tier 2 town where this experience is not even offered, you offer a very high quality luxury experience. Ultimately, these tickets are 250 rupees only. It's not like is very exper very expensive but you get an air conditioned room with a large screen great sound recliners like you see their cinemas are all like very high quality recliner looks like it so the experience is quite different I quite like this company and this model

29:51 it is not just some local cinema chain he's actually someone who's put a lot of thought behind what he's doing then yes you have to hope that you are right when you bet on the trend but my view is that the cinema experience is not dying it is just being augmented with more content which is coming in the founders and watching in a big screen cannot be compared to watching on the phone which is a majority of the content gets consumed in this tier 2 tier three and the step from that to cinema significant for not a lot of cost so I don't think it'll go away and there is enough under penetration still for for this this guy's model got it I agree to disagree with you 100 budget on that because I feel he was like experienced like you earlier used to go for a cinema. People used to go

30:37 for a cinema probably once every week, once every two weeks, right? Now you have like once every two months then movie comes where you want to go. So it just like having a asset built for that is somehow not sustainable like because your usage per customer would probably decrease a very very random point like I'd gone this Thursday. I had gone for this movie Fantastic 4 on a Thursday morning because it was my wife's birthday. had gone for a movie on a Thursday morning, 11:00 a.m. show. I maxed for a movie Fantastic 4. 11:00 a.m. working day. The the cinema the hall was 50% full. I was shocked. I thought I would be the only we would be the only ones in the in the theater. So, it it really depends. Of course, this is Bangalore urban uh observation, but it is not gone. I feel

31:22 if anything, it's getting very hard to book tickets like whenever I try to book a ticket, it's all sold out. Uh if you're booking for the coming weekend. So at least in Bangalore I don't see that. Maybe that's true in some of the smaller towns. I'm not sure but at least I don't see that decline. Towns I feel would go more per say because like there you don't have so many other options to do right. Plus like these are small right so you can have those corporate events like a cricket game watching or something like you can have all of those things as well which can work out. Correct. Correct. Yeah. positive on this company. We'll talk more uh when we essentially uh discuss more. But yeah, with that, let's me let me quickly move forward to the

32:09 third company, All Time Plastics. Setting up the company incorporated in 1971. Company specializes in manufacturing of plastic houseware products. It mainly manufactures consumer wear for B2B white label clients while also offering products under their proprietary brand all-time branded products for B2C customers. So plastic company bottles containers I remember I have bought from DMA a couple of times all time brand K so definite some recognization there you can understand about the company but setting up the IPO it's a 400 cr IPO out of which 280 cr fresh is 120s market which is slightly higher I feel than the

32:56 pre they had And the buzz was that it will come at the same price at preip but yeah close to 22%. F 25 financials revenue 560 47 cr so they're coming at like 40 times trailing 40* purchase LM intensive or dam capital. So with that over to Sachin to talk about all time. Uh am I audible? Yep. All right. So uh Altime Plastics is based out of Maharashtra and they manufacture high quality consumerware plastics uh that is catered to households and hotel industries etc. Uh

33:43 these are uh BPA free plastics. So they also comply with the global standards since they do a large uh part of revenues are coming from exports. Uh currently uh three brothers are managing the operations Mr. Kalash Sha Bupes Sha and Nilles Sha uh who handle entire operations. So they are primarily a B2B player and not a B2C player. So they largely supplies to other B2B uh entities and companies. Uh around 92% of their revenues are from wideleing. So they supply to global retailers like IKEA, uh Marks and Spencers, Tesco, ASDA, Walmart, Dollar T etc. And around 8% of the uh rest revenues are from proprietary brand uh which is sold under the alltime brand and they also have tie-ups with Vishal, Mega, Zeppto,

34:32 Spencers across 23 Indian states. uh currently they have 1,900 SKUs in their uh portfolio and around 500 to 550 SKUs they uh launch every year. Uh 85% of their revenues are from exports uh from European Union, UK, uh US is around 10% and they claim to be India's second largest exporter of this plastic houseware category. Uh in their revenue verification around 36% of revenues comes from these food storage, kitchen tools etc. uh 9% is from other miscellaneous storage. Uh 20% is from those dining tables uh buckets over dust bin over uh bathroom products over etc. uh currently they operate three manufacturing units uh one is Dan uh one in Silvasa and one in Manakpur. So uh

35:19 Manakpur uh one is started in December 24 only and uh the three facilities are having a combined capacity of 33,000 metric tons and around 80% of utilization. Uh they also have set up a subsidiary alltime plastics PT in Singapore and one uh subsidiary in India as well for uh alltime bamboo private limited uh which is focusing on sustainable products. I'll come on that later. uh they have around 700 employees and 1,600 contract workers to cater to this demand. Uh long-standing relationship with IKEA is a benefit around 27 years diverse portfolio with all these SKUs. Also robotics they do a large part of their manufacturing is done through automation. So around 100 to 110 machines of 140 machines that

36:06 they deploy are in done with robotics and automation. uh they also uh use recycled plastics to manufacture around 28% of their products. Uh coming to the revenues in FI23 they did around 443 CR of revenues with 17% AIDA. In FI24 it was 512 CR of revenues and 18% AIDA. So this increase was primarily due to the Silvasa facility uh which was upgraded in time. So it uh reflected in those revenues. In FY25, the revenues didn't rise much uh around 8 to 8.5% only based on the lower volume growth. Uh this was primarily due to the other two facilities being operated at uh optimum utilization and the Manikur facility coming live in December 24 only. Uh receivables are contained in uh in the

36:53 balance sheet none are within outside the operating cycle. Uh cash from operations is healthy as well. uh they claim to have a higher inventory turn uh turnover ratio uh other than the listed peers which is Shal Engineering and Cello but this is this is only for the listed space the unlisted players are actually having a 17 times invited turnover uh I'll come on that later when we discuss the peers so for FY26 uh uh they are targeting around 15 to 18% of growth given the higher inventory that they have built in March 25 and similar margins like FY25 uh their new facility for which they are taking the IPO proceeds will probably reflect in FI27 and beyond only and advanced bamboo facility uh to transition to more sustainable products

37:38 that is in advanced stocks for commercial production nothing uh confirmed yet but so if it will it will be uh announced very soon. Uh now coming to the Singapore subsidiary uh which is intended to enhance their global pres presence. So they have partnered with one dragon PT also in Singapore as well which is a marketing agent type and that will help to supply all times products to any new customers in overseas. So uh in this JV what happens is uh suppose that u uh all time sells to this subsidiary for 80 rupees or subsidiary customer 100%

38:25 of the profit will go to all time and the rest 49% of the profit will go to this dragon PT which is a marketing agent. So this reduces marketing expense for all time. Uh but it also means some uh re less revenues. Even if the volumes are not increased though revenues will be declining. Uh coming to that risk around 60% of the revenues is from IKEA which is a big risk but they have around 27 years of relationship. So that should not materialize uh anything in negative. uh the shift of consumers to more eco-friendly materials like bamboo and glass etc uh may reduce the plastics demand but nothing in the short term and medium term and they have very low on own brand revenues around 8% only so

39:12 that they need to focus on uh more going ahead uh US revenues is around 10% only but we we have seen that what tariffs and all can do nothing has announced as of yet for these items but who knows the future uh for The IPO use around 143 CR is for repayment of borrowings which will save around 10 uh Kors of interest uh post tax and 121 and around uh around 113 CR is for new molding machines for 36 machinery that will they will be adding uh in FI26 only. So this will increase the Manikpur facility uh capacity to 16,500 tons in FY26 and they have further planned expansion in FI27 out of internal recurral so far for

40:00 22,500 metric tons and that will be done post IPO so nothing announced as yet. Uh coming to the pricing this issue has around 120 CR of OFS. uh pre IPO was done around two at 248 per share uh when in which a backers took part and now the IPO is coming at 10% higher so it is coming at 38 times trailing 32 37 to 38 times trailing and on forward basis if we go by the projections uh it is coming at 30 times with 62 crores of PT so comparable player is Shelly engineering but because Shelly is also in B2B cello is largely in B2C uh Shelly has other good products as well for healthcare and eta And it it is trading near 80 times. Now why it is trading near 80 times? Because uh it holds a top position for

40:46 this injector pins and there is one GLP one drug opportunity in India as well floating around. So that is the reason for its higher valuation. Uh there are other unlisted beers as well. Ratan plastics, Asian plast etc. All of these have similar evident pet margins like all time but they they are growing much better at 24 to 25% whereas uh all time is growing at 15 to 18%. Anchors were decent. Uh no one seemed more robust to go in full force for that anchor allocation. Caner Roe was there. There again is there. No newama crossoff crossover fund is also there. So I felt it's decent. Uh it's also benefiting from that China plus one strategy in some senses and promoter history and background is also good. So decent

41:34 enough. That's all. Got it. Thank you. Very comprehensive questions. But you saying this will grow at like 15 to 80 18% and it's a fairly uh like fairly like settled business. So it exponential growth. It would only be incremental from my understanding. None of those sustainable bamboo etc can probably become very big. Right? uh or something if something sticks it will probably have to stick like let's say something like a GLP1 injectable device stick for SH maybe something can happen here but nothing is in public domain in terms of like what is that future growth coming from

42:20 100% correct that is that is what it is and cranning to do with that 280 any new facility or anything like that interview available online Yeah. Uh interview 143 CR is for repayment of borrowings short-term and long-term both that will save in interest cost and 113 to 115 CR is for new machinery to increase that manic food facility capacity. So that will be deployed there and the rest is OFS and GCP. So again it's a interesting company but somehow like valuation was slightly expensive than what I would have thought but having like IKEA as a partner it's a

43:05 it's a you know it it is those like slow growth companies which will not like go completely difficult for it to go completely out of business right like it's one of those which will come continue to do well but like do you think like plastic plastic regulation something might come up because of which they might uh like face like the sector in itself might face some problem because of them mainly making plastic. Nothing in short term because they are not the ones only operating in this plastics and they also are coming coming up with that bamboo facility. So they are trying to diversify but nothing in short-term that takes their entire business off the spin. Got it last because this is also closing

43:51 on 11th and 1 is also closing on 11th and the star is closing on 12th. So all three will clash. Uh so we'll kind of form the priority order. Before that we definitely want to go ahead and cover the OG company which we wanted to talk about which is JWC. Uh setting up JWCM incorporated in 2006. Uh company is a manufacturer of green in India and is committed for sustainability and innovation. The company operates seven plants across the country including one integrated unit, one clinkard unit and five grinding units and has total grinding capacity of 20 million metric tons per so that's about the SWC cement company south prominent setting up the IPO it's a 3600 cr IPO out of which 1,600 cr fresh 2,000 crores offs

44:36 companies coming at a market cap of 20,000 crores so diluting close to 18%. FI25 financials revenue 6,000 crores and PAT was 160 cr so they had made a loss of 160 crores at a PAT level maybe that is because of depreciation we'll find out I don't know LM is access city dam gold bank Jeff and SBA Capital so with that over to you to talk about JSWC is my voice audible yep so first of all I will tell you one JW cement is like very tough you know the complexity man I'll try to explain everything I would say the point after point so you need to listen very care

45:23 very carefully actually personally I was not today in a position to do a space but as it was already committed uh no we will be concluding this so JSW cement limited is India's eighth largest cement company in terms of total installed capacity and sales volume the company has a grinding capacity of 20.60 mmp. What is MMTP? Million metric 10 perom. Okay. Uh and it is also one of the top three fastest growing cement companies. The company produces uh its product portfolio is like blended cement which has three types BSC, PCC, PPC. GGBS is the second big product which has like 32% revenue. What is GGBS? Ground granulated blast for slag.

46:08 So blast furnace which is which is used for production of steel. Okay. JSW raw materials which is redmix construction India largest player it has 84% market GGBS and you know RMC is growing at a very uh you know next level scale it also has some uh other products like ordinary ordinary Portland cement clinker and uh RMCB They also do uh screen screen slack. They do construction chemicals and small waterproofing compounds. The company has

46:57 a clinker capacity of 6.44 mmp. Now one will say grinding capacity. The reason is very simple. The company uses flyment ordinary Portland as a component get mixed into the cement need for clinker that goes down the company has seven plants seven plants one is in andra one is in Karnataka Maharashtra West Bengal and one in UAE total 6.44 44 million mm clinker to the UAE. Okay, that is into their subsidiary

47:43 of which is a UAE based clinker capacity. JSW cement has lowest carbon dioxide emission CO2 emission intensity in the whole world. So number so they just emit 258 kg CO2 per ton. Okay. So this is 52% lower than the top 10 players in India and 54% lower than leading global cement companies in the world. Okay. So this is a significant achievement for the company. Uh you know coming on it distribution. The company has 4650 dealers 8,844 sub dealers and it has 158 warehouses. So it's a fairly large distribution unit. The company is raising 3600 crores

48:28 out of which 1600 is a fresh issue. 2,000 is an OFS. Now everyone here knows 4,000 cr out of which 2,000 was fresh out of the 1600 the company's allocating 800 crores towards uh doing the part capex in Nagago Rajasthan to set up integrated cement unit which will have 3.3 mmpa clinker and 3.5 mmpa grinding facility and this is expected to get live in June July 2026 Q127. But you need to know already

49:24 72 second half. So now coming on debt part 520 towards 5800% cost of 280 is towards GCP coming just for the sake of you know mentioning I'm doing that why I'm saying it 23 the comparator did a revenue of 5,837 crores. Operating aida was 816 crores and PAT was 104 crores. Operating

50:11 difference this I'll be covering FIR 24 628 cr revenue 1,9 margin F23 14% 18.23% and P of 62 crores F25 the revenue dropped by 3% to 5813 crores. See this revenues operating revenue total revenue is 864 crores the beta margin drops from 18.23 to 14.87 and 62 net loss. Now one very important metric to check in JW cement is the abida per turn aida per turn I'm just in the gross level aidal per turn in fa 23 was 777

50:57 rupees in 24 it was 877 and 25 dropped to 683 or operating per turn 23 was 788 24 827 25 64 and now at a later point of comparison I'll be telling that at a later point. The company has few subsidiaries and few associate companies. Subsidiaries first Shiva cement which is a listed company if you know. So that is a clinker company. uh the company JW cement 63 64% has taken listed JSW cement uh Shiva cement sorry second subsidiary JW green cement

51:44 which which sells proper green cement transport company which is an integrated or in-house transport and logistics company and they have 1/4 called scam enterprises they have an associate company interesting called as GSW1 platforms I had recently posted one month back. So JSW1 platforms is an unicorn unicorn company with a valuation of roughly 9,000 crores which is your B2B construction materials company just business infra recently listed ARS infra listing SD company. So that is a billion $1.1 billion company which is like 9,000 cr. So this company was 14% 13.8% precisely

52:31 stake in that company. Okay. Why I'm mentioning that you have to listen it very very carefully. The company is coming at a market cap of 20,41 cr,000 only at gross level bit 36.8 eight times post money 25 I'll tell you the peers sh 26.3 jk 14 times ultra techn first is loss from JVS and associates of

53:17 98.5 groups or fair value loss in the yeah profit and loss statement FTP 14426% JW green 2.3 cr was 99% stake and 1% what we can say one of an associate of JW cement to this company is into green cement or FI25 I would say operationally they have broken even F25 most likely report because JSW84

54:04 loss. So this is a GV between JW cement and Aquarius global fund of 5545 JV 55 is owned by JW cement to Dubai facility and cement that has also done very poorly 25 earnings before interest if you look at two results I'll I'll tell you they JSW it looks like a pan India company but it isn't at this point it will get into pind south India based company and you need

54:51 to understand that industry dynamics north India that is the most lucrative market the stabil of stability stability of the prices and the volume growth is highest region south east west north lucrative market selling realizations are better, growth is better and infra push is also better and the worst market is south market. I won't say the worst but why it is worst the competition in south market is tremendous to we have seen some recent consolidation orient cement was bought by a cement company that is going to you know get acquired by very soon you'll be getting that company uh that official official penna cement was acquired by uh

55:37 at 78,000 cr that was a big company then you got India cement that was acquired by ultr Then you know the dynamics already. So what has happened the small small cement there is a big tough fight happening between Dalmia and for JP group assets that is for like 15 16,000 cr asset. So what is happening the south market aggressive consolidation and I'll tell you the results a bit of two companies which are mostly into south India Ramco

56:24 aida per Q1 that was 966 rupees which is an increase of 32% yi and 59% Q in aida return 40% and appro 55% 1261 1261 rupees so is a big part they enjoy very superior margins due to the operational efficiencies and the brand they have in the south markets pa numbers we don't have as it is an unlisted we just have the revenues and pads but we don't have that so what I'm trying to tell you is key jo segment fi25 was one of Worst years for this companies selling price realizations that were very poor in F24

57:10 reported by almost every cement company that has been very strong in Q1 that has increased by like between 30% to 4550%. And that has been like roughly 30% 25 this will also include the north Indian players also to give an fair estimate or the you know idea towards the beta ultra tech 1149 which is like 20% fault ram 966 917 820 JW

58:00 877 683% Y increase now you need to understand one thing realization that had been very poor in your whole FI25 which is bouncing back in Q1 and know what what is leading to this bounce back and why it should be you know carried forward First the revival in the prices the increase in the government spend and that is a very I would say normal basics statement but the other better reason I would say is very valid is the money spent by this big guys. So if you just check out the balance sheets of top 10

58:45 players in India except no Vistas and JW art players balance sheet a minute. Yeah should be back but yeah so what I was telling is key the amount and money spent by the uh this all the top cement companies is significantly higher than it used to be in past if you look at the balance sheets of the top 10 players what is your no vistas which is like Gujarat based company North Indaga

59:33 company which is owned by your Nirmma It is owned by because that is a heavy debt company and second company wholes the balance sheets are very fantastic and attractive. What I'm trying to tell you is key these guys are full of capital. They're well equipped. So these guys are acquiring lot of companies. The consolidation is happening in a big what just I'll give some examples. Pa was

1:00:20 acquired for 7,000 crores. Vadrage was acquired at 2200 crores. There's one another company called as thehati cement that is getting acquired very soon. Your JP associate assets that is for 16,000 crores. for that cement maybe that will get upgraded. Sani cement was acquired. Your udaur cement was acquired. Your Andra cement was acquired by Saga cement. Uh another uh there are another star cement is also on the verge of getting acquired. Hidd cement was in talks with Adani group for getting acquired. company that is an Italian or German company assets that got acquired then what I'm trying to tell Burhanur cement

1:01:07 got acquired in 23 so what I'm trying to tell these guys have spent almost I would say 50 to 60,000 cr rupees in acquiring all this assets and this is except a JP so all these guys have spent that money they cannot afford the realizations and a bit effort and going So the prices in the Q1 have been extremely strong from the second half of April month. So current that should be as per minimum 3 to 35% it is a bit numbers revenues if you just do realization you'll get the straight

1:01:55 numbers I talk on the volume growth estimates and the GGBS growth gbs is expected to grow at 13 to 15% which is 34% revenue of JWA to realize should increase the cement which was I would say degrowth of 3% in first quarter due to the hike in the prices minus but the whole industry is expecting 5 to 7% growth in the whole FI26 minimum benchmark% below lower end with the increase numbers and important point towards JW W one thing JW1 platform unicorn company Mr. Arjindal on on record he has said that 26

1:02:42 is doing a grinding capacity complete integrated cement company that 220 that should go down. You have logistics company that will go profitable. You have got your Dubai subsidiary which is going take in a big way in F26. So he loses that should come at break even in for sure. So if I consider all this adjustments or loss from your AIA pattern will increase by roughly 30% on the benchmark side to 25

1:03:28 even that will take your AIA margin from 14.5 to appro half%. So if I just go and check on the numbers easy so your will increase from 800 I'm saying grossa what difference is operating in your nonerating and denominator remains the same due to that normal has all the components

1:04:13 operating has cement GGBS that you need to understand to if this dicks up your beta will increase from roughly 800 crores to maybe 1,400 crores which is very easy simple four standard mathematics so that 37 on paper. Yes, you heard it at 15. And one another good thing is Q1 of next financial year capacity uh grinding that will go to 26 and what one I would say upper edge with this companies. The I would say the best thing any company can have a cement company can have is having limestone of their own. Limestone is a raw material of cement core raw material. or factory.

1:05:01 JSW has got all their limestone reserves very close to their factories. And then another capex which is going to get installed near Ban Steel and Paris Path Limited BL Supreme Court which the company was acquired in acquired by Jindal Steel but it was challenged by its creditors. So already so these guys have limestone in place. So recent to make one mmpa grinding facility takes

1:05:47 roughly 450 crics market value they a company with lower realization no limestone and less logistics get gets in selling price of 800 to 900 cr rupees per ton per 1 mmpa a company with good realizations, good selling price, good brand but without limestone it's 1,100 1200 crores. A company with solid brand, solid realization, limestone in place, logistics in place gets 1,600 crores. This company falls in the falls between fourth and third category. The only issue these guys have is lower realizations. Buck Limestone is in place, logistics is in place, you have got everything in place, you have got

1:06:32 the backing of the JW group and they are doing a lot of internal consumption also. So what I feel the company is pretty good and treat that I feel is on a wrong note. If just put in the numbers, you will find the value in this company. And I feel this kind of company is mostly should be driven by your foreign investors. I feel this most mainly driven company is what my take on this company would be. Got it. Thanks. Question. So feel free to disregard them but from my understanding next generation

1:07:21 right so can you help us explain like what all at a high level does JW do how big of a part it is JW at a high level that and then second question green cement what is exactly the green part in it like do you think that will become big or what is the theme sure I'll I'll answer the first The family of the JW group companies started from Jindal then one more I guess third generation sorry Jindal then all these guys I've got lot of brothers soindalind has been the very basic third generation third gen cement is the largest entity in that you have got JW1 platforms which is a

1:08:08 unicorn company you have got JW motors which which runs MG Motors and they're developing another four EV models. I guess they have got one another company that is into I guess manufacturing segment company but they have already I guess 200 crores of revenues in that also. So these are four main companies three three main JW motors is also by the way is also new business for them. So main coming on the second one is green cement. If you look at number percentage of green power used to manufacture cement players 8% 28%. Second the C2 CO2 emissions per 10 are lowest in the world for this

1:08:57 company. Okay, I'm saying and one stroke these guys are unbeatable in complete globe for this uh emission wall stuff. Another thing is uh the ESG certifications, ESG awareness and newer what we can say environmental sustainability uh laws and stuff are on a rise from 2023. So when the world will go towards sustainability especially our country will go towards sustainability lower you know emissions products no these guys use fly ash in their majority products than your clinker that is also

1:09:42 another production cost that is one of the lowest in the industry. So these all three four factors are being termed as green cement. Got it. Understood. I feel this is for sure a slow mo. It is an USB but it's not a stuff which should give you an premium but it's what we can say longterm theme. Got it. Got it. But yeah other than that also the company looks good right. So maybe what I will do is with that we

1:10:29 have covered almost all four companies. We'll now just talk about what we are planning to do with each and this is something which will go in the premium uh uh members content. So we still figuring out how to not put it in space. So you'll see but yeah uh starting with uh Sachin uh your feedback on star are you planning to apply? Uh yes uh some uh some valuation gap gap is left given that the FY25 base was lower uh but that is reduced via OFS. So but I think some gap is left Chandan 14 pair correct right and Chandan is a slightly superior P it has that hospital chain hospital chain pharmacy chain yes so slightly better yes

1:11:17 also hospital pharmacy come I feel rad but they soon will demerge that as well going ahead so that is one thing that to get captive patients right like patients come from the hospital to the radiology they don't have to give out a lot of kickbacks to doctors to like because end of the day radiology is a like a B2B sort of a model it is not really B2C B2C is like we don't go to do radiology center on our own some doctor refers us right so there are kickbacks which are involved so if some company has those invol like directly put in then it's helpful No actually is also going into B2B is what I know and they have already got

1:12:02 some good revenues from B2B doing two three another contracts. So comp all both of these are in B2B B2G B2C chan has B2C and here B2G is very the problem is the B2G like what I've seen with this diagnostic is it's majorly like Krishna diagnostics is the one which has the largest B2G component I think 60 70% of is B2G they get the lowest valuation because of cash flows because they you compare their cash flow with any other like a Vijay or anyone these guys will be negative cash flow everyone else will be positive and this

1:12:48 one will have some 300 year receivables so the the problem for star is that it's majorly B2G so it will get a lower multiple than Chandan which is anyway getting much lower you know getting discount from all the similar kind of diagnostics in the main board which get much higher multiple. So I it is cheap. It is looking very cheap to me. But just remember that B2G is the the main thing here will be B2G. Got it. So with that uh moving to you Roy to talk about complex uh what are you planning to do and then we'll create a priority order as well. I know what I'm planning to do so I'll share that towards the end. So I will be applying for complex. I am

1:13:35 applying with the view that I'm okay to hold this for some time. That is it's not a I don't necessarily foresee a pop 90 cr this market very again I told you it reminds me a little bit of GC hotels which also lists in a very bad market listed flat when negative for 2 days before exploding. Uh so I do feel this is an interesting company different segment. I'm not going to make a very high high allocation. That's going to be a bit of a left field bet with a very small this thing. But I I'll apply and I think I I'm guessing we should be able to get a lotment also. We not be very overly subscribed. But I I'm not buying expecting like serious listing gain or anything. That happens good. But otherwise I'm because some it's rare to find people who are coming with a plan

1:14:20 to grow 60 70%. And it's looking visible that growth is looking visible given he claims he has the loss for all of this. working capital will unlock it for him. Uh and if he can grow 60 70% getting it at 18 times is not bad. Got it. One thing on this complex uh that preipo happened at 142 per share and now this IPO is coming at 177. So already priced to premium around 20 25%. When did that preview happen? uh in May and June uh this 25 months ago. Yes, got it. That's a slight pointer to consider because yeah, I also

1:15:06 feel could have been slightly cheaper but even at 18 times if the growth is there maybe can apply limited in order to get some allocation. uh moving forward Sachin to talk about all time uh I felt decent uh the business can't be replaced in one day uh but the growth outlook suggests that uh nothing major so short-term pop only

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