Top Tweets for #NextPattern

4 months ago

I think the question isn't how to find the next stock, it's how you find the #NextPattern before the market does. Because once you start seeing the pattern, you stop chasing reratings and start asking where the next one might come from. Take transformers as an example, the sector has already done extremely well. So I'm not really asking whether transformer demand will keep growing, the more interesting question is where does the bottleneck move next? One thing I noticed across transformer concalls is that management teams keep talking about the same things. CRGO Electrical Steel -> Bushings -> OLTCs -> Testing Capacity -> Specialized Insulation Systems. Keep that order in mind... Now look at the transformer companies first, #TARIL has a ₹5,000+ crore order book, utilization moving from 75% toward 95% and capacity expanding from 40,000 MVA to 75,000 MVA. Management is also entering HVDC and backward integrating into CRGO, CTC and pressboard. The conversation is no longer about finding demand. It's about expanding capacity, securing inputs and controlling more of the value chain, that itself feels like a signal. The same thing shows up at #Shilchar. Capacity is moving from 7,500 MVA to 14,000 MVA, utilization is expected to reach 90-95% and the company is adding 220 kV capability. Again, demand isn't the discussion anymore. Capacity is. Then look at #Voltamp. It started FY27 with a ₹1,200 crore backlog and added another ₹310 crore of orders in April alone. Management is still being selective while commissioning another plant in July 2026, even here the discussion is execution and delivery, not whether customers exist. Now look at #HitachiEnergy. A record ₹29,555 crore backlog and nearly ₹4,000 crore of expansion capex. Management is building capacity for HVDC, data centers, BESS, AI demand and renewable integration. When companies this large start spending thousands of crores, I think they're preparing for something much bigger than today's order book. Which makes me wonder what happens next, if every transformer company keeps expanding capacity, where does the pressure move? Because higher transformer production doesn't just mean more transformers, it also means more demand for CRGO, bushings, conductors, insulation systems and testing support. The bottleneck starts moving upstream, that's where #VilasTranscore caught my attention. CRGO capacity has expanded from 12,000 MT to 36,000 MT, with FY27 volume guidance of around 30,000 MT but the interesting part isn't just CRGO anymore. Management is also talking about nanocrystalline cores, radiators, copper conductors and HV bushings. That feels like more than a capacity story. Now look at #JayBee. Revenue reached ₹549 crore, CRGO utilization is around 65% and the EPC order book is close to ₹280 crore. Management isn't just building CRGO capacity, they're trying to build an integrated platform across CRGO processing, transformers and EPC. The opportunity seems to be there, the market is still waiting for proof. Then there's #YashHighvoltage. Order book above ₹400 crore, revenue at ₹235 crore and EBITDA margins above 25%. Management keeps talking about localization, RIP/RIS bushings, exports and capacity expansion. That stood out to me. Then another question came to mind, if CRGO is such an important bottleneck, why did #Yash rerate so strongly while #Vilas and #JayBee didn't? Because there are actually two different bottlenecks. Industry bottlenecks and value-capture bottlenecks. CRGO, transformer capacity and testing facilities are industry bottlenecks, they determine how fast the industry can grow. Bushings, RIP technology and highly qualified niche components are value-capture bottlenecks, that's where margins and economics may actually accumulate. Look at what management teams are saying. #JayBee talked about CRGO prices falling 30-35% and margin pressure. #Vilas talked about CRGO prices falling 15-20% and profitability pressure. #Yash talked about margin expansion, localization, exports and capacity expansion. That's a very different conversation, if CRGO processing was where most value accumulated, wouldn't CRGO processors be earning the highest margins? Instead, they're talking about price volatility and inventory adjustments, meanwhile #Yash is already operating above 25% EBITDA margins. That doesn't necessarily make #Vilas less interesting, it actually made me look at the company differently. If it stayed only a CRGO processor, I probably wouldn't find it as interesting, but management seems to understand where value may move next. That's why they're investing in nanocrystalline cores, radiators, conductors and bushings. Maybe they're trying to move from an industry bottleneck toward a value-capture bottleneck. Which also explains why the market is treating these companies differently. #Yash is already in the proof stage. Revenue has grown, margins have expanded and orders are visible. The market can already see the earnings story. #Vilas feels more like the transition stage, the investments are happening but the market hasn't seen meaningful revenue from the newer businesses yet. #JayBee feels different again, the opportunity is there but the question is whether management can execute across CRGO, transformers and EPC while controlling working capital. The interesting part is that this post isn't really about transformers, #ItsAboutPatternRecognition. A few years ago the market focused on transformer manufacturers. Then it moved to order books, capacity expansion, CRGO, bushings and other components. Value kept moving through the supply chain as each bottleneck became visible, that's the pattern I keep coming back to. Demand -> Capacity Expansion -> Bottlenecks -> Chokepoints -> Value Capture. And by the time everyone agrees where the bottleneck is, most of the easy rerating has already happened. That's why I keep thinking about grid stability, not because transformer demand is over but because the same pattern may be starting all over again. So the question isn't which stock to buy, it's where the next bottleneck is forming and which bottleneck is quietly becoming the next chokepoint.

Saurav

@sauorbit1

4 months ago

Look, I’m not saying all this because you need to know everything or track every single thing, that’s not what I’m trying to say. I’m saying it because whatever decision you take, take it after thinking about it properly. Don’t just look at what has happened or what is happening right now, think once about what may be coming next in the grid ecosystem. Because sometimes the answer is not where most people are looking. Take 4 companies — GE Vernova, Hitachi Energy, Siemens Energy and ABB. Now see where most of their revenue comes from today and what type of revenue it is. Then look at what is sitting inside the order book. Is it the same as the current business or does it look different? Then look at what management is planning for the next few years. Is it the same business you see today or are they preparing for something else? Then think about what problem or demand management is trying to solve and where in the grid ecosystem it sees the biggest opportunity. Now connect all of that. What pattern do you see? What has already been discovered and priced in by the market? And what may still not be fully discovered or reflected in expectations? Because sometimes the signal is not in one company, it is hidden in what multiple companies are preparing for at the same time. Once you see that pattern, you stop looking at the company and start looking at where the demand is going. Now all you have to understand is where the chokepoint is building and where the bottleneck may appear next. That's it. There is your next decision. See, you already know the stock names, the price, the backlog and the orders, but what is missing is clarity on where the demand is building, where the grid can break, and which parts of the ecosystem could matter the most over the next few years. This PDF can give you that clarity and help you make a better decision. https://t.co/B13BHvu6kv

Making Doctors Organization @doctor_making

over 5 years ago

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