In today’s briefing:
- The Beat Ideas: Bharat Wire Ropes- The Turnaround and Transformation
- AMFI Stock Reclassification Preview (June 2024): Potential Changes as Momentum Recovers
- Wardwizard Innovations: Promoter Dumped Stake Under the Billion Dollar Illusion
- Sanstar IPO- Forensic Analysis
The Beat Ideas: Bharat Wire Ropes- The Turnaround and Transformation
- Debt restructuring in 2021 reduced interest costs and improved profitability, with promoters increasing their stake by 4%.
- Revenue and EBITDA have grown significantly, with a revenue CAGR of 35% and EBITDA CAGR of 72% over the past 3 years.
- Strong export presence and increasing domestic market share indicate robust growth potential despite global economic fluctuations.
AMFI Stock Reclassification Preview (June 2024): Potential Changes as Momentum Recovers
- We see 7 stocks moving from MidCap to LargeCap and vice versa, 17 stocks from SmallCap to MidCap, 19 stocks from MidCap to SmallCap and 2 new additions to MidCap.
- The expected migrations from SmallCap to MidCap have outperformed the other potential migrations with all stocks moving higher over the last six months.
- Momentum on the upward migrations could sustain as active managers reposition their portfolios. Some stocks will have passive flows over the next few months.
Wardwizard Innovations: Promoter Dumped Stake Under the Billion Dollar Illusion
- The billion-dollar order that had initially seemed like a game-changer for Wardwizard Innovations turned out to be its downfall as it happens to be a Non Binding MoU.
- While for an INR 300 crore revenue company billion dollar order was huge, hence stock price rose on the back of rosy picture.
- Promoter used the situation to dump the shares via stake sale as the news of order led to 20% rise in the stock price which eventually raises Corporate Governance Concerns
Sanstar IPO- Forensic Analysis
- Sanstar (SANSTAR123 IN) is primarily focused in producing maize based specialty products and ingredient solutions in India. It currently occupies a market share of around 7.8%.
- The company has shown good growth in the last two years; however, when it comes to accounting and forensic checks there are several grey areas/unique policies.
- Examples: Revenues are stated gross of GST and are net of freight and brokerage costs. Classification of some of free reserves into revaluation reserve, Salaries paid to some senior personnel,etc.
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