Congruence Advisers

SEBI registered Research Analyst (INH000019202) firm. See website for details

[Congruence Advisers @CongruenceA]

Announcement

We recently started a research series on microcap stocks and emerging stocks.

We will be writing detailed business research notes on 2-3 stocks every month.

Subscribe for free updates
Please RT in your network

https://t.co/eD2LG5QcW0

[Congruence Advisers @CongruenceA]

The electric cables favorites are selling off for a well known reason - Ultravolt

Will the Relative Strength hold up this time for the Power theme?

[Congruence Advisers @CongruenceA]

One of the strongest themes over the past 12-18 months, things getting interesting

Hitachi Energy

[Congruence Advisers @CongruenceA]

Siemens Energy

[Congruence Advisers @CongruenceA]

Many are working with the 2021-23 template in mind

The template of 2011-13 is worth studying too. You never know what the market can throw at you

[Congruence Advisers @CongruenceA]

On a more serious note, what's happening right now was always on the cards

Hindsight bias? Nope

Recognized this as a realistic possibility more than 6 years ago. Of course, the HDFC merger has supplied the "fuel" of muted numbers and just lit the fuse

[Congruence Advisers @CongruenceA]

Is HDFC Bank the next IDFC FB?

PS: Sarcasm

[Congruence Advisers @CongruenceA]

@BaxFinanceFB Agree. The trend to watch is higher client stickiness, improving margin profile through business mix changes & ability to maintain 16-18% ROCE across cycles

Decent operating cash flow generation is a huge positive in EMS

[Congruence Advisers @CongruenceA]

This surely must be the decade of "the comeback of core engineering" in Indian equity

Even in a segment like EMS, exposure to defense, aero, industrial, AI, DC order books getting higher valuation compared to consumer electronics

The preference is crystal clear now

[Congruence Advisers @CongruenceA]

@Pivot2Centre Many "investors" in the under development projects have no intention of even registering the unit, they want out just before registration. This segment is a big buying center for builders

Also 2 years of low capital gains in equity means fewer buyers for tax saving needs

[Congruence Advisers @CongruenceA]

@SK_Harbinger Tega isn't part of our coverage universe

But now that you mention it, we'll get an analyst to take a look at it soon!

[Congruence Advisers @CongruenceA]

Seeing Win-Win JV's with
- Technology/client access from the foreign partner
- Manufacturing by Indian partner

Examples from our universe
- Syrma SGS
- Vishnu Chemicals

Auto sector doing this for decades, now going mainstream across sectors

Disclosure: Invested, not a reco

[Congruence Advisers @CongruenceA]

@soicfinance Huge pivot in balance sheets for big tech in the US

From asset light business models to huge capex in assets that get depreciated quickly

Fragility going up, even if this turns out to be a success story

Interesting times

[Congruence Advisers @CongruenceA]

While Auto & EMS JV's are primarily for domestic consumption & import substitution now, export markets should open up meaningfully over time

Possibilities are immense

All about good execution for the next 2-3 years to prove & scale this model

[Congruence Advisers @CongruenceA]

What dominated headlines in March/April doesn't matter as much today

The focus has shifted to earnings and businesses that can deliver > 20% growth p.a.

[Congruence Advisers @CongruenceA]

The market doesn't get scared of something that's already a well known scenario

The response to the first hint of bad news is more intense than the response to the third bad news from the same source

We'll see this week if this time tested principle is still at play

[Congruence Advisers @CongruenceA]

Read the entire post here

https://t.co/68TixG1r3o

[Congruence Advisers @CongruenceA]

Category expansion & heightened competition - Cables & Wires

Moats that investors took for granted are getting challenged

High ROE segments without technology differentiation continue to get attacked by large capital pools

Our post from Jan 2021

[Congruence Advisers @CongruenceA]

@gurjota Time to lead & sculpt a life true to yourself and follow your convictions

Will be a lot of fun

I completed 8 years of this very same step yesterday. Wish I'd done it sooner!

[Congruence Advisers @CongruenceA]

@PalSouresh Yes, another useful indicator we track

[Congruence Advisers @CongruenceA]

Can small caps keep rising with the NIFTY 50 staying dormant?

How many times has it happened in the past beyond 2-3 Qs?

[Congruence Advisers @CongruenceA]

@Feluda71 Do check both starting valuation & the earnings growth of small caps over this period, then benchmark to the current Phase

These exercises are usually very interesting