(1/20)
About:
GMM Pfaudler manufactures GLE, heavy engineering & proprietary products.
It is a leading supplier of process equipments to the pharmaceutical and chemical industries
It has 14 manufacturing facilities globally. With 7 in Europe & 3 in India.
About:
GMM Pfaudler manufactures GLE, heavy engineering & proprietary products.
It is a leading supplier of process equipments to the pharmaceutical and chemical industries
It has 14 manufacturing facilities globally. With 7 in Europe & 3 in India.
(2/20)
Journey of GMM:
Journey of GMM:
(3/20)
Key Growth Drivers for Pharma Industry:
• Policy Support:
PLI scheme, an initiative by the
government has changed
the outlook and sentiment of
Indian market in the global
arena.
As of March 2022, govt has
approved 19 applications of
₹4,623 cr, under PLI scheme.
Key Growth Drivers for Pharma Industry:
• Policy Support:
PLI scheme, an initiative by the
government has changed
the outlook and sentiment of
Indian market in the global
arena.
As of March 2022, govt has
approved 19 applications of
₹4,623 cr, under PLI scheme.
(4/20)
• Cost-effectiveness:
Pharma companies
in India possess the ability
to produce high-quality
products at an economical
rate.
Low-cost manufacturing
will help them leverage the
opportunity of $5-6 bn
emerging from patent expiry
across the globe in the next
4-5 years.
• Cost-effectiveness:
Pharma companies
in India possess the ability
to produce high-quality
products at an economical
rate.
Low-cost manufacturing
will help them leverage the
opportunity of $5-6 bn
emerging from patent expiry
across the globe in the next
4-5 years.
(5/20)
Specialty Chemical
Industry:
• With an increase in domestic
production of specialty
chemicals, exports are
expected to rise too
• Improved compliance adherence with strong R&D culture, contract
manufacturing opportunity
and focus of nations on China +1
Specialty Chemical
Industry:
• With an increase in domestic
production of specialty
chemicals, exports are
expected to rise too
• Improved compliance adherence with strong R&D culture, contract
manufacturing opportunity
and focus of nations on China +1
(6/20)
• Business Overview
GMM Pfaudler is present
across Americas, Europe and
Asia through its offerings in
technologies, systems and
services. The company
has sustained its business
relations with marquee
customer base & continues
to strengthen the same.
• Business Overview
GMM Pfaudler is present
across Americas, Europe and
Asia through its offerings in
technologies, systems and
services. The company
has sustained its business
relations with marquee
customer base & continues
to strengthen the same.
(7/20)
Business Highlights:
• Cross-selling of multiple products to customers globally resulting in increased customer spend
• Breakthrough in new markets such as Spain, SE Asia & Eastern Europe
• Gained market share in US & Europe by offering cost-effective solutions
Business Highlights:
• Cross-selling of multiple products to customers globally resulting in increased customer spend
• Breakthrough in new markets such as Spain, SE Asia & Eastern Europe
• Gained market share in US & Europe by offering cost-effective solutions
(8/20)
• Acid Recovery business continues to grow with new orders from South Korea, China and India
• Process know-how and green technologies being developed to target new high growth sectors
• Dedicated engineering and process teams to grow systems business
• Acid Recovery business continues to grow with new orders from South Korea, China and India
• Process know-how and green technologies being developed to target new high growth sectors
• Dedicated engineering and process teams to grow systems business
(9/20)
Acquisition:
The global acquisition has opened multiple growth levers for GMM Pfaudler Limited in terms of competitive sourcing, widening the customer base, broadening the products and solutions portfolio, and opening considerable cross-selling opportunities
Acquisition:
The global acquisition has opened multiple growth levers for GMM Pfaudler Limited in terms of competitive sourcing, widening the customer base, broadening the products and solutions portfolio, and opening considerable cross-selling opportunities
(10/20)
Order Intake & Backlog Trend:
The company is expecting India’s backlog in the glass lined business to range between 4-6 months.
And that the glass line in India is going to be a big driver for them in the next few quarters.
Order Intake & Backlog Trend:
The company is expecting India’s backlog in the glass lined business to range between 4-6 months.
And that the glass line in India is going to be a big driver for them in the next few quarters.
(11/20)
Increase in receivables:
The company’s receivable days is seeing an uptrend. And it is going up for both for India and International markets.
The company expects to get the collection going from this quarter onwards. So we can keep an eye on this number in the future.
Increase in receivables:
The company’s receivable days is seeing an uptrend. And it is going up for both for India and International markets.
The company expects to get the collection going from this quarter onwards. So we can keep an eye on this number in the future.
(12/20)
Company’s Europe Business:
The company is doing better than expected in Europe which is a positive. It is seeing demand as well as it is able to transfer rise in input prices to its customers.
It has added new small businesses,
through M&A which is seeing growth.
Company’s Europe Business:
The company is doing better than expected in Europe which is a positive. It is seeing demand as well as it is able to transfer rise in input prices to its customers.
It has added new small businesses,
through M&A which is seeing growth.
(13/20)
Key Strengths:
• Market leadership in the domestic GLE industry:
It is the market leader in the domestic GLE segment, with a share of around 55%.
The group has a near monopoly in large vessel segment. However, We should keep an eye on M&As taking place.
Key Strengths:
• Market leadership in the domestic GLE industry:
It is the market leader in the domestic GLE segment, with a share of around 55%.
The group has a near monopoly in large vessel segment. However, We should keep an eye on M&As taking place.
(14/20)
• Strong technological expertise and market presence of Pfaudler group in global markets
The company has acquired technology for manufacturing GLE from Pfaudler and has access to the diversified product mix and strong research and development capabilities of the group.
• Strong technological expertise and market presence of Pfaudler group in global markets
The company has acquired technology for manufacturing GLE from Pfaudler and has access to the diversified product mix and strong research and development capabilities of the group.
(15/20)
Post Acquisition Shareholding Pattern:
• GMMP is holding 100% stake in the 17 Pfaulder International entities through GMMI.
• Equity stake of Patel family in GMMP increased from 22.3% to 24.2%.
• DBAG continues to hold 31.9% in GMMP (currently 32.7%).
Post Acquisition Shareholding Pattern:
• GMMP is holding 100% stake in the 17 Pfaulder International entities through GMMI.
• Equity stake of Patel family in GMMP increased from 22.3% to 24.2%.
• DBAG continues to hold 31.9% in GMMP (currently 32.7%).
(16/20)
Weakness:
• Financial risk profile
GMMP has a total debt of ₹878 cr as on 31 March 2022, which includes pension liabilities worth ₹373 cr.
• Net gearing increased to 0.7 times (from 0.3 times) as on September 30, 2022
Weakness:
• Financial risk profile
GMMP has a total debt of ₹878 cr as on 31 March 2022, which includes pension liabilities worth ₹373 cr.
• Net gearing increased to 0.7 times (from 0.3 times) as on September 30, 2022
(17/20)
• Large working capital requirement
Typically inventory days range from 100-120 days while debtor days remain around 40-50 days.
Operations may remain susceptible to inventory pricing risk and potential delays by customers in taking deliveries.
• Large working capital requirement
Typically inventory days range from 100-120 days while debtor days remain around 40-50 days.
Operations may remain susceptible to inventory pricing risk and potential delays by customers in taking deliveries.
(18/20)
Key Ratios & Numbers:
• Market Cap: ₹8,308 cr
• Stock P/E: 52.8
• RoCE 3 Years: 17.3%
• RoE 3 Years: 20.2%
• Debt: ₹888cr
• PEG: 2.37
• Price to Sales: 2.90
• OPM 5 years: 13.4%
• Cash Conversion Cycle: 151
Key Ratios & Numbers:
• Market Cap: ₹8,308 cr
• Stock P/E: 52.8
• RoCE 3 Years: 17.3%
• RoE 3 Years: 20.2%
• Debt: ₹888cr
• PEG: 2.37
• Price to Sales: 2.90
• OPM 5 years: 13.4%
• Cash Conversion Cycle: 151
(19/20)
GMM Pfaudler should continue to benefit from its strong market position in the GLE segment & technological support from the Pfaudler group. The company is likely to maintain a healthy financial risk profile through steady cash accrual & benefits of synergies flowing in.
GMM Pfaudler should continue to benefit from its strong market position in the GLE segment & technological support from the Pfaudler group. The company is likely to maintain a healthy financial risk profile through steady cash accrual & benefits of synergies flowing in.
(20/20)
What’s your view about the company and it’s medium term performance?
@caniravkaria @kuttrapali26 @chartmojo
What’s your view about the company and it’s medium term performance?
@caniravkaria @kuttrapali26 @chartmojo
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