Sovrenn Daily News - 9th Jan 2025

Tembo Global Industries Ltd

Recent filing: (ORDER) Tembo Global has bagged an order worth INR 40.7 Cr from Domestic Organisation, for Water Irrigation, needs to be completed within 12 months.

SUMMARY: 5y Operating Profit uptrend | 1q Operating Profit uptrend | PE 32.2x (Sector PE range 30-60) | Excellent Sep-24 results | Large Order | Fund raise | Institutional Entry | Promoter Buying | Capacity Expansion | Order Book of INR 1,200+ Cr and Order book of Textile is INR 180 Cr (Sep-24) (3x times of FY24 Revenue) | Capital Goods – Non Electrical equipment.

FUTURE OUTLOOK: As per Q1FY25 Investor Presentation, Company current capacity is pegged at 15,000 tons per annum. The ongoing green field expansion at Vasai will bolster company overall capacity by 6x times, reaching 105,000 MTPA by FY25.

• MCap of INR 871 Crore (share price = INR 784 / share) (as on 9th Jan ‘25)
• TTM PE 32.2x (as on 9th Jan ‘25) Retail float = 23.4% (Sep-24)

FOOD FOR THOUGHT: Negative Cash flow from operations for FY24

Company Description: Tembo is a prominent engineering company, manufacturing high-quality specialised metal products for a wide array of applications, including Pipe Support Systems, Fasteners, Anchors, and HVAC, catering to industries like Automotive, Real Estate, Infrastructure and Oil & Gas. Additionally, the Company process and supplies fibres and yarn (Textiles Division) and is poised to enter the Defence sector by FY26.

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EMS Ltd.

Recent filing: (ORDER) EMS has received a Letter of Acceptance (LoA) worth INR 416 Cr from the Indore Municipal Corporation for designing and building sewage treatment plants with installed capacities of 120 MLD, 40 MLD, and 35 MLD, along with all appurtenant structures and allied works. The project, undertaken on a Design-Build-Operate-Transfer (DBOT) basis, includes the operation and maintenance (O&M) of the complete works—sewage treatment plants, interception and diversion works, pumping stations, and all allied works—for a period of 15 years for Indore city. In this project, EMS holds a 26% share, in partnership with another JV partner.

SUMMARY: 5y Operating Profit uptrend | 1q Operating Profit uptrend | PE 26.4x (Sector PE range 10-50) | Institutional entry | Large Order | Orderbook of INR 2,345 Cr (Sep-24) (2.7x of TTM revenue) | Fund Raise | Acquisition | EPC | Water Infra

FUTURE OUTLOOK: As per the Q2FY25 Concall, Company projected a revenue growth of 25%-30% for FY25, with a target of around INR 1,000 Cr | Management is confident in maintaining EBITDA margins of 25%-27% | Company has a bid pipeline exceeds of INR 6,470 Cr, with expectations of converting 10%-15% into orders within one to two months.

• MCap of INR 4,520 Crore (share price = INR 814 / share) (as on 9th Jan ‘25)
• TTM PE 26.4x (as on 9th Jan ‘25) Retail float = 21.7% (Dec-24)

FOOD FOR THOUGHT: Negative Operating cash flow for FY24.

Company Description: EMS Limited is a multi-disciplinary EPC company, headquartered in Delhi that specializes in providing turnkey services in water and wastewater collection, treatment and disposal. EMS provides complete, single-source services from engineering and design to construction and installation of water, wastewater and domestic waste treatment facilities.

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Rocking Deals Circular Economy Ltd.

Recent filing: (FUND RAISE) BoD of Rockingdeals has approved the issuance of 5.98L equity shares and 2.25L warrants at INR 535/each, aggregating to INR 44 Cr. Subscribers include Sandeep Singh, Grobiz SME Opportunity Fund, and Promoter Group.

SUMMARY: 2y Operating Profit uptrend | PE 51.6x (Sector PE range 30-70) | Fund raise | Institutional entry | Ace Investor | Promoter buying | Consumption

FUTURE OUTLOOK: Company plans to invest INR 100 Cr over the next 12 months to accelerate its expansion across India and internationally. Company expects this strategic investment to help achieve revenue of INR 400-500 Cr by FY27, with projected PAT margins of 10-15%.

• MCap of INR 360 Crore (share price = INR 636 / share) (as on 9th Jan ‘25)
• TTM PE 51.6x (as on 9th Jan ‘25) Retail float = 14.4% (Sep-24)

FOOD FOR THOUGHT: Negative operating cash flow for FY24.

Company Description: Company is a leading Indian B2B re-commerce company specializing in excess inventory management and sustainable procurement solutions. Company specializes in bulk trading of surplus and refurbished inventory across various categories like mobile phones, electronics, home appliances, apparels etc.