Avikshit Vijay

Aspiring Portfolio Manager | Equity Research | Financial Modelling | CFA Institute Candidate

[Avikshit Vijay @VariantIQ]

Howards Marks is also convinced with the core driver that mentioned in this article (snippet from his latest memo attached)

Do read the article - might just give you the ALPHA you need in the markets.

And read the latest HM Memo here - https://t.co/WqXXDrzzct

[Avikshit Vijay @VariantIQ]

https://t.co/fV90CNIRon

[Avikshit Vijay @VariantIQ]

🚨Saudi Aramco halts OIL supplies to india indefinitely!

Following the destruction of its East-West Pipeline in the Houthi attacks.

Saudi contributes ~10-15% of India's crude and over 50% of India's Gas supplies

With Oil and Gas supply bottlenecked, and Russian sanctions not seeming to be lifted - India's STUCK!

in a dilemma of either appeasing the US by buying WTI, or sidelining them to continue procuring Russian crude.

But here are beneficiaries and adversaries of this!

Benefits:
- Oil and Gas sector (ONGC, OIL, Asian Energy, Deep Industries)
- Reliance (partly)
- Shipping vessel companies (GE Shipping)
- Ethanol Blenders
- Renewable power companies (substitution effect)

Losers:
- Paints
- OMCs
- Construction vehicles and Delivery companies
- Chemicals
- T&D companies without Price Escalation clauses

Let's just hope it doesn't turn out to be worse than we can ever imagine!

[Avikshit Vijay @VariantIQ]

https://t.co/Xnx48WNZTh

[Avikshit Vijay @VariantIQ]

FED PULLED THE TRIGGER FINALLY‼️

A 25bps hike - the first rate hike since 2023

After Inflation data came in 'too hot' and employment data robust.

The commentary was as hawkish as it could get.

Median Federal Funds Rate pushed upward to 4.125%, inflation forecast marginally upped....

THE BIGGEST....

Soaring Yields attributed to economic strength and capital supply deficit.

While acknowledging input cost pressures....

Kevin Warsh reiterated his comment on inflation to be elevated and "TOO HOT"

But refrained from forward forecasts.

That's HAWKISHNESS at it's peak!

🔻NEGATIVE FOR METALS AND AI TRADE IN THE NEAR TERM

#ratehike #usa #fomc #usfed #kevinwarsh

[Avikshit Vijay @VariantIQ]

🚨ALL EYES ON THE US FEDERAL RESERVE TONIGHT

Markets have started to price in a 25 bps rate hike....

AI trade has crashed, Gold has crashed, inflationary pressures are soaring high...

What remains to monitor tonight is NOT the rates....

But the COMMENTARY!

That will be the moving needle.

If commentary is hawkish (the most likely scenario) + rate hike = metals and the AI trade are to CRASH

If commentary is dovish (unlikely) + rate hikes = metals and the AI trade will RALLY

BUT BUT BUT....

IN the most unlikely scenario,
If the commentary comes dovish and rates are NOT hiked....

Metals will simply not stop it's breathtaking rally - the next leg of BULL RUN will start from here.

That's hypothetical though, a bull case for metals.

WATCH OUT FOR COMMENTARY TONIGHT FOLKS!

#usfed #gold #metal #interestrates #inflation #federalreserve

[Avikshit Vijay @VariantIQ]

Interesting company i was reading about today.

Astra Micro!

The Co is the sole PRIVATE supplier for Uttam Radars used in Tejas MK1, Mk1A and Mk2 (as Angad)

They recently received an order from HAL worth ₹2205 crores for Uttam Radar's AAAU (active antenna arrray unit) which doubled their Order Book to over ₹4500 crores.
This particular order is executable until FY31, with the Phase 1 deliverable by September 2027.

Additionally the company is the DCPP (development cum production partner) and L1 for Virupaksha Radars used in SU-30s, which the IAF builds alongside Tejas.

The most interesting part is, no other private peer matches this capability - not Data Patterns, not Apollo Micro, NONE.

And they expect a significant step-up in their growth journey post FY28, when the Uttam orders can finally be booked as revenues.

The guidance is jaw-dropping.
Concall snippet is attached below!

THE BIGGEST ISSUE though...

Valuations.

At 85x PE and 44x EV/EBITDA, the price payable appears to be discounting the cashflows post FY28 - when the hyper-growth phase is expected.

And Astra Micro historically has gone through painful price and time corrections lasting between 320-360 days.

At current peaks, I envisage a neutral price movement until September 2027 when the Uttam Radar AAAU Phase 1 gets delivered and an intimation is submitted to exchanges thereafter.

That will prove execution capability and trigger the NEXT Bull rally.

What do you think?

#defence #india #uttamradar #hal #astramicro

[Avikshit Vijay @VariantIQ]

https://t.co/HNtY65BnIm

[Avikshit Vijay @VariantIQ]

US CPI and PPI are giving MIXED signs - versus the estimates....

In reality, the prices have started inching upward...

And yields are already at dangerously high levels

PPI hits 5.4% YoY up 60 bps from July, driven by a 30bp rise in Core PPI and a 30 bps rise in energy and food prices.
Core PPI met estimates while PPI exceeded estimated 5.3%

CPI, on the other hand came in at 3.4% YoY, almost FLAT compared to July data, while Core CPI was also flat at 2.4% YoY versus July's 2.5%

Now here's the thing.

PPI is the metric to look at RIGHT NOW

That shows what the prices at the B2B level are - since B2C (retail) prices are largely influenced by consumer demand and elasticity

So PPI prices in cost inflation much sooner than retail prices do, and right now, that's FLASHING RED

With a hotter PPI number, and a Fed chairman commentary of "inflation too high", the odds of a Fed rate hike have substantially improved

That means negative for commodities in the near term and positive for the dollar.

MIND YOU..

High inflation is ALWAYS good for Gold in the long term - but that inflation is to be driven by normal prices, not energy, which is the case now. (definitely not sustainable)

In conclusion,

Metals may fall in the short term, but that presents the BEST buying opportunity for the long term.

BE GREEDY WHEN OTHERS ARE FEARFUL AND FEARFUL WHEN OTHERS ARE GREEDY!

#usa #inflation #cpi #ppi #dollar #gold

[Avikshit Vijay @VariantIQ]

I guess i manipulated the share price of Unimech.

Shares surge 8% in trade today😁

Don't miss my deep dive articles!

[Avikshit Vijay @VariantIQ]

https://t.co/MwUD2at8dO

[Avikshit Vijay @VariantIQ]

https://t.co/MwUD2at8dO

[Avikshit Vijay @VariantIQ]

https://t.co/jIFv4AQ8Gt

[Avikshit Vijay @VariantIQ]

Gold and Silver have been skyrocketing for the last 15 hours..

Here’s why!

The US Treasury announces increasing the limit to Buyback Govt bonds

Which means there’ll be more purchase of US Bonds by them…

While this is called Quantitative Easing in theoretical economics, let me explain how this is negative for the dollar and thus, great for metals and alternatives

First, why are they buying back their own bonds?

Because no one else wants to. And the Yields have reached an uncontrollably high level - record high since 2007.

High yields = more interest on US’ $40 trillion debt (def not sustainable)

So here’s what they’re doing….

Buyback of own bonds induces demand for the bonds which raises it’s price

To buy these, the FED prints money

When prices rise, along with increasing money supply, inflation surges in the country

And high inflation means depreciation of the currency (which is the USD)

Also, higher prices of bonds mean lower yields (price and yields are inversely related = fixed income 101)

So to curb yields is the paramount objective, and weakening dollar emerges as a consequence

(Countries have 3 choices - growth, employment, and currency - and a country can prioritize only 2 at a time)

Right now, the US focus is on growth and employment levels which results in an implied depreciation of USD.

And hence, metals which move against the dollar, surge at an unprecedented pace!

That’s what was witnessed yesterday!

#gold #silver #usdollar #dollar #ustreasury

[Avikshit Vijay @VariantIQ]

Most people just discovered Aerospace & Defence 🚨

I flagged this one long before the crowd showed up.

Link to my article - https://t.co/8O9Pq5ChjN

This is about one particular company in the Aerospace and Defence industry that i find really interesting

An unconventional and a unique, niche, and differentiated business model

Not subject to the extreme working capital cycles

Unimech Aerospace and Manufacturing Ltd.

Precision engineering isn't a buzzword here - it's embedded in the DNA.

Two business lines. One is the stabilizer. One is where the real story sits.

HERE'S WHERE THE STABLE CASH COMES FROM:
👉 Tooling business - tools for aero structures used to load planes
👉 MRO tooling for maintenance cycles
👉 Long qualification cycles - precision here can't be compromised
👉 Low value as a % of total project size - keeps OEM spend sticky, non-discretionary, inevitable

HERE'S WHERE THE ENTIRE OPPORTUNITY ACTUALLY LIVES:

Precision Component Assembly (PCA). This is the vertical to watch.

👉 Precision parts and assemblies for A&D, Energy, Semiconductor industries
👉 Currently in the investment phase - qualifications, First Article Inspections (FAI), new SKUs
👉 Operating leverage building aggressively, waiting to show up in the numbers once scale kicks in

HERE'S THE THEME THIS ACTUALLY TAPS INTO:

PCA doesn't just ride the A&D wave. It sits at the intersection of four decadal themes

🟢A&D
🟢Nuclear
🟢Oil & Gas
🟢Semiconductors

Yes, scale-up raises working capital needs. But recurring, long-dated contract revenue might overpower that drag.

HERE'S THE NEAR-TERM TRIGGER:

👉 Management expects a better PCA mix in H2FY27
👉 Recent Hobel Bellows acquisition adds metallic bellows, flexible tubing, tubular structures - expanding product offerings
👉 AS9100 certification pending for Hobel - expected to clear by Q4FY27

That certification clearing is the next re-rating catalyst.

IS NOW THE RIGHT TIME TO ENTER?

The stock has built a long IPO base and is now headed into a breakout.
Historically, IPO base breakouts have preceded multi-month rallies.

One final word -

There's immense operating leverage building up.
Once the scale builds up, there'll be massive flow down to the bottomline - a key catalyst for aggressive multiple re-rating

⚠️ Not a recommendation - purely educational. DYOR 🙏🏻

#aerospace #defence #stockmarket #india

[Avikshit Vijay @VariantIQ]

https://t.co/IuN2SOEnkq

[Avikshit Vijay @VariantIQ]

PM Modi's 80th Independence Day speech wasn't just symbolic....

It was the BIGGEST INSIDER INFORMATION on India's economic transformation 🇮🇳

12 years. One direction - SELF-RELIANCE.

👉 Defence output up 4X
👉 Textile production up 5X
👉 Semiconductor plants now LIVE
👉 Solar capacity: 2 GW to 160 GW
👉 100% household electrification
👉 Gas pipeline cities: 70 to 700

And the next chapter is bigger:
👉 ₹1 lakh crore Viksit Bharat Rozgar Yojana for jobs
👉 5 new nuclear reactors this decade, eyeing 100 GW by 2047
👉 Deep sea oil & gas exploration opened up
👉 Made in India chips going mainstream
👉 GST rate cuts on the table

The message is clear. India isn't depending on anyone else anymore.

The govt has told you exactly where the capital is flowing.

Question is: are YOU positioned in the right sectors?

#StockMarket #India #finance #IndependenceDay #Indiaindependenceday

[Avikshit Vijay @VariantIQ]

The Strait of Hormuz is not just about Oil and Gas

And this is creating one of the BIGGEST MIS-READS in the market

Everybody is thinking - Oil is costly, so fuel becomes expensive....
EVs are the next thing, let me invest in them

But here's what they're missing

The Hormuz crisis affects EV industry just as much as it does to the ICE (Internal Combustion Engine) industry

Give me 4 minutes, and I'll open your eyes

EV Battery makers have 2 choices for their products...

LFP (Lithium Iron Phospate) and NMC (Nickel Manganese Cobalt) batteries

Here's how they're different:

LFP Batteries are for the common man.
- Cost effective
- Longer Life
- Tolerates partial charging

Made using an olivine cathode, and abundant elements of Iron and Phospate, these are used in entry level and economical EVs like Ather Rizta, Tata Curvv, BYD, E-Buses and House batteries

NMC Batteries are a performance powerhouse
- High performance due to high density
- More range
- Cold-tolerance

Made using layered oxide cathode, it's reserved for applications where performance is non-negotiable - Premium EVs like Tesla, Ather 450, Ola S1, Data Centres, Phones/laptops, etc

In short, LFP trades range for cost, safety and longevity, while NMC trades cost for performance.

What's Hormuz got to do with this?

Sulphur.

Over 50% of global sulphur transits that narrow strait - and right now, that's choked.

Sulphur is produced in the process of Oil and Gas refining - so the Gulf owns abundant sulphur

Sulphur is used for production of Sulphuric Acid - a critical ingredient for the High Pressure Acid Leaching (HPAL) and Solvent Extraction and Electrowining (SX-EW) processses.

HPAL and SX-EW are methods used in processing metals like Nickel, Cobalt, and Copper - all of which is facing a MASSIVE supply crunch.

China's export ban on sulphuric acid adds fuel to the fuel.

These crucial metals are abused quite extensively in EVs - copper usage in EVs is 10x more than ICE, and Nickel and Cobalt are the very elements that constitute the NMC batteries

When the very acid used to make the elements constituting the batteries fall short, the price inflation for the metals that ensues get directly passed on to OEMs, and then invariably to consumers.

If you think LFP batteries are insulated,,,, You're WRONG

LFP too takes a hit, albeit a less intense one

The P in LFP stands for Phosphate, made using Phosphoric Acid.
To make Phosphoric Acid, you need to mix Phosphate Rock with....

Yes, Sulphuric acid...

Estimates suggest over half of global lithium, cobalt, copper, phosphoric acid, nickel and rare earths depend on sulphur for processing

One element affecting six critical minerals.

That's systemic risk at peak.

But, within EVs, LFPs are relatively less affected, and thus, i believe LFP adoption to accelerate....

Already at 55% mix globally - if the supply issues persist, LFP adoption can gain immense pace...

Final Words:

EVs aren't any less affected than ICE vehicles.

If there's any relativity, the inflation among EVs might be more profound - given that most base metals used in multiples of ICE vehicles are witnessing an unprecented inflationary outlook

NMC is most affected, followed by LFP, and then EVs on the whole

The OIL PRICE IS BULLISH FOR EVs is a thesis to be re-worded and re-thought of.

Follow the second and third order effects - that'll give you the most insights!

If that opened your eye, do consider liking the post, sharing it with your investor friends and dropping me a follow for more such content

#straitofhormuz #copper #stockmarket #EV #battery

[Avikshit Vijay @VariantIQ]

We're just getting started my friend!!

Gold already up 10.5% from this level.

The previous highs might just be the next target to be flirting around with!

#gold #investing #metals #silver #copper

[Avikshit Vijay @VariantIQ]

https://t.co/fV90CNIRon

[Avikshit Vijay @VariantIQ]

https://t.co/fV90CNIRon

[Avikshit Vijay @VariantIQ]

https://t.co/DatvMmDoRb

[Avikshit Vijay @VariantIQ]

https://t.co/fV90CNIRon