The Chatter: Between Headwinds and Tailwinds
Edition #27
Welcome to the 27th edition of The Chatter — a weekly newsletter where we dig through what India’s biggest companies are saying and bring you the most interesting bits of insight, whether about the business, its sector, or the wider economy. We read every major Indian earnings call and listen to the interviews so you don’t have to.
We’re always eager to improve—please share your ideas on how else we can innovate “The Chatter” format to better serve your needs.
In this edition, we have covered 20 companies across 8 industries, along with some international features.
Chemicals
Sharda Cropchem
Rain Industries
Logistics
TCI Express
Textiles
Ganesha Ecosphere
FMCG
Mrs. Bectors Food Specialities
Dabur India
Energy
NTPC
Financial Services
Muthoot Finance
Poonawalla Fincorp
Cholamandalam Investment and Finance
Metals
Ashapura Minechem
Mishra Dhatu Nigam (MIDHANI)
Auto Ancillary
Precision Camshafts
JBM Auto
International
Virgin Galactic
Crocs
Krispy Kreme
Micron Technology
Hanesbrands
Novavax
Chemicals
Sharda Cropchem | Small Cap | Chemicals
Sharda Cropchem Limited specializes in exporting a wide range of agrochemicals and non-agro products to countries worldwide. Their product portfolio includes formulations and active ingredients for fungicides, herbicides, insecticides, and disinfectants, catering to the needs of different crops and markets.
Bubna said growth momentum should continue as long as currency stability holds
“We should be able to sustain it (growth). See, our business is also dependent upon the cross currency exchange rate….sourcing is all in dollars… Around 95% of sourcing is from China and our majority sales are in Europe. So, the euro-dollar exchange rate has a very critical impact on our performance. This year the euro dollar exchange rate is very stable and very respectable that is why the performance is good.”
— Ramprakash V. Bubna, Chairman & MD
He clarified why the company won’t be affected by proposed U.S. tariffs.
“So, the customer has no choice but to buy the products from the same source… so, we are able to pass on all the tariff increase to our customers and he then is able to also pass it on to his customers and finally the citizens of the US are going to pay.”
— Ramprakash V. Bubna, Chairman & MD
Bubna highlighted that earlier industry-wide stress is behind them.
“What happened about two years back or last year is the past. Now the global trend is normal, the global uh inventory levels are also normal and there’s a…..good match between the consumption and production.”
— Ramprakash V. Bubna, Chairman & MD
Rain Industries | Small Cap | Chemicals
Rain Industries Limited is a global manufacturer of critical raw materials for various industries. It has three main segments - Carbon, Advanced Materials, and Cement. The company is a major producer of CTP and CPC, supplying essential raw materials worldwide.
Management explained the multiple headwinds affecting the Carbon segment’s distillation operations.
“The challenges of our Carbon segment’s distillation business are manyfold right now. Most, however, are linked to the Russian - Ukraine conflict over the last several years. Initially, skyrocketing energy prices in Europe resulted production curtailments by several aluminum smelters which were native customers for our European operations. Next, the elimination of both Russian and Ukrainian coal tar from the historic European supply pool, due to a combination of factors, has greatly limited the availability of traditional coal tar raw materials in Europe. Lastly, the recessionary trend, which has stemmed from the war in Ukraine, has resulted in high energy prices and shifting supply chains. These changes have increased costs and forced steel mill rationalizations in Europe over the last few years, further exacerbating the coal tar supply situation. In addition to our continuously increasing use of alternative raw materials and sources, our focus will be cost control to re-establish margins and then grow back volume over time.”
— Gerard Sweeney, President, Rain Carbon Inc.
He described the effect of global oil market swings on RAIN’s businesses.
“The recent oil price volatility has been due to a combination of the recent conflicts in the Middle East and on-going uncertainty on international trade flows as the US continues to negotiate new trade agreements with other nations and economic blocs. Oil prices have little to no impact on our Carbon segment’s calcination business beyond the links to transportation fuel prices. However, oil prices do have some impact on the pricing of both our raw materials and our finished goods in both our Carbon segment’s distillation business and in our Advanced Materials segment. Oil price volatility usually causes companies and economies to change the speed at which they make purchasing commitments and investments. As such, in some countries and product lines, we saw customers ordering more products from RAIN, and in other areas, customers delayed their purchases from RAIN. While there may be opportunities which arise during times of volatility, in general, businesses are more stable, and business decisions are made in a more predictable manner, when there is less volatility.”
— Gerard Sweeney, President, Rain Carbon Inc.
Logistics
TCI Express | Small Cap | Logistics
TCI Express Limited offers transport, storage, warehousing, and support services with a focus on express distribution. They provide time-bound solutions across various sectors like automotive, pharmaceutical, textiles, IT, retail, and e-commerce, including domestic and international air express services.
Management reaffirmed volume growth targets driven by festive season momentum.
“We have guided for 8–9% volume growth in FY26. Demand has been strong in September, particularly in electronics and lifestyle products, supported by the GST cut. We expect the festive season to provide an additional boost. For the full year, we should end with 8–9% growth in volumes and about 11–12% growth in revenue.”
— Mukti Lal, ED & CFO
He explained how GST restructuring is supporting sector-wide consumption.
“GST V2, moving from four layers to two, was long awaited. The reduction in rates will boost consumption across India. As a domestic express company, we serve auto, engineering, and lifestyle segments, all of which stand to benefit. Quick commerce is another area where we are seeing demand, especially from dark stores during the festive season. This will support stronger growth in the second half of the year.”
— Mukti Lal, ED & CFO
Management clarified why GST cut on trucks has no direct cost benefit and how margins will improve.
“The reduction of GST on trucks from 28% to 18% has no impact on our costs. We don’t own trucks — our supply is fully outsourced. Our vendors were already able to take input tax credit earlier and continue to do so now. The increase in our costs is largely due to investments in building air and rail networks to de-risk our surface business. These networks are now in place, and with higher utilization, we expect gross margins to improve. Last year margins fell by 200 basis points, but higher volumes and better truck utilization should support recovery.”
— Mukti Lal, ED & CFO
He outlined recovery trends across customer segments supported by reforms and monsoon.
“In Q2 and beyond, we expect recovery in kitchenware, pharma, lifestyle, and engineering segments. The reduction in GST on farming-related equipment, such as tractors, will also boost demand. With a good monsoon this year, we expect higher sales in these categories, which will benefit us.”
— Mukti Lal, ED & CFO
Textiles
Ganesha Ecosphere | Small Cap | Textiles
Ganesha Ecosphere Ltd is a manufacturer of Polyester Staple Fibre, Textured/Twisted Yarn. Their products find diverse applications in carpet manufacturing, blending with woolen yarn, non-woven filling, fabric weaving, and more.
Management explained why they believe they can maintain an edge despite a potential price war.
“None of the qualities of any of the competitors have yet been proven on ground. And we think that still we are very, efficient in our operations from any of our competitors currently operating in the Indian market, be it about sourcing, be it about operations, be it about sales and volumes. So we think that we will always be able to remain -- be able to maintain that alpha from the competition no matter what.”
— Yash Sharma, Director
CFO highlighted that margins should hold until demand–supply equilibrium is reached.
“The industry is a very nascent industry, and the industry is developing. And so it is very, very difficult to predict the pricing and the margins presently over next 3, 4 years. So definitely, we expect the margins would be maintained until the demand supply gap is there and which we expect would be next 3, 4 years when the 60% mark is achieved.”
— Gopal Agarwal, CFO
Management described demand cycles across their two verticals.
“We have 2 verticals. One is textiles and the other is packaging… For Packaging, usually, the summer season is the best, though this summer was really badly affected due to the early onset of monsoons in India. So for beverages, especially in packaging for us, the summer season is usually the best demand quarter. In case of textiles, it really varies. The festive season, generally, I think quarter 2, quarter 3 are usually remain the better ones.”
— Yash Sharma, Director
Yash Sharma explained how consumption differs between South and North India.
“South India is a much more consistent industry in terms of volume in beverages and FMCG throughout the year because they don’t have winters. But certainly in North… during the winter season, the volumes go down. So they go down by about 30% to 40% in the winter half of the year.”
— Yash Sharma, Director
FMCG
Mrs. Bectors Food Specialities | Small Cap | FMCG
Mrs. Bectors Food Specialities Limited is a leading company in the premium biscuit and bakery segment in North India. They offer a range of biscuits and bakery products under brands like ‘Mrs. Bector’s Cremica’ and ‘English Oven’, catering to retail and institutional customers across India.
Ishaan Bector explained how distribution, quick commerce, and health-focused innovation fueled outperformance.
“On the Bakery side, we have basically always been saying that our vision is to be a pan-India player… we have extensively increased our distribution… we have a very strong market share on the quick commerce, where we are aggressively working… most of our breads today on the healthy side are made of no maida, they are using no palm oil. We have also now added a new brand to our portfolio, which is called Nature Bake… taking the health portfolio to the next level.”
— Ishaan Bector, Whole-time Director
Management shared channel mix and growth outlook.
“For the Bakery, it’s about 30% our contribution of modern trade and e-commerce, quick commerce. What we are seeing is that this contribution… will go up higher as expansion of these segments, quick commerce becomes deeper into tier 2 cities as well.”
— Ishaan Bector
Management highlighted resilience in exports despite U.S. disruptions.
“We are not facing any concerns other than the US market. So, otherwise, business is as normal. But what has happened is that with a lot of US disruptions going on… a lot of shipping, transportation has been moving in and out to other countries. Otherwise, other than the US, we don’t foresee anything… Everything else stands normal to us.”
— Manu Talwar
Management explained why they expect stability ahead.
“On the inflation front, particularly in the raw materials, the sharp price hikes driven by geopolitical disruptions and supply chain bottlenecks appear to be behind us. Prices of key commodities like cocoa, palm oil and maida, even though still elevated, are now stabilizing.”
— Anoop Bector, MD
Dabur India Ltd | Mid Cap | FMCG
Dabur India is the largest Ayurvedic company globally with a range of products focused on health, wellness, personal care, and value-added foods.
Malhotra said GST simplification has created a level playing field for organised players.
“What we see optically is a rate reduction, but what we don’t see are the procedural simplifications. Earlier, a local Chyawanprash had 5% GST while a branded one had 12–13%. Now, all Ayurvedic medicines fall under 5%. This bridges the gap between unorganised and organised players, and gives a major boost to quality production in India.”
— Mohit Malhotra, CEO, Dabur India
He explained how even small price changes could have a transformative impact on consumption.
“If you take price points in FMCG — say a Rs 1 product brought down to 93 paise — in absolute terms, for the Indian market, that’s Rs 2 lakh crore of impact. Demand will improve, which means investments will improve, which means employment will improve. The Indian economy will really benefit.”
— Mohit Malhotra
Malhotra highlighted how specific price thresholds dominate rural and urban demand.
“The Rs 5–10–15–20 price points contribute 40–50% of consumption. These magical price points cannot be breached. If they are, it would lead to commensurate grammage increases across the board.”
— Mohit Malhotra
He linked tax/GST savings to rising disposable income for India’s middle class.
“For a Rs 25,000-per-month household, the GST and tax reforms translate into savings of Rs 800–1,000 monthly, or Rs 17,000–20,000 annually. For a household earning Rs 5 lakh a year, this is substantial and will translate into higher consumption.”
— Mohit Malhotra
Malhotra stressed that women shoppers drive rural demand, which is highly price-sensitive.
“A consumer often doesn’t ask for a brand, but asks for a product at a particular price point. That’s why these points are magical, and they cannot be breached.”
— Mohit Malhotra
Energy
NTPC | Large Cap | Energy
NTPC, India’s largest integrated power company, focuses on delivering reliable, affordable, and sustainable electricity to the nation through thermal, hydro, solar, and wind power plants.
CMD shared that NTPC has scaled up its growth ambition significantly, with a higher capex plan.
“We had our business plan almost around six years back. We had kept around 130 gigawatt by FY32. We have already revised that and the upward revision is, it is 149 gigawatt by FY32 instead of 130. And in that also there is going to be, there will be additional capex, which will be going in the PSP, green chemicals, BESS etc., so put together, we aim to invest about INR 7 lakh crore by FY32.”
— Gurdeep Singh, Chairman & Managing Director, NTPC
Management emphasized NTPC’s big entry into nuclear power as part of India’s net-zero journey.
“NTPC has entered the nuclear energy domain with an ambitious goal of installing 30 gigawatt of nuclear capacity by 2047, contributing significantly to the nation’s 100 gigawatt target. We are advancing two key initiatives on the nuclear front. First is ASHVINI, our joint venture with NPCIL… Second is NPUNL, our newly formed subsidiary dedicated to harnessing advanced nuclear technologies.”
— Jaikumar Srinivasan, Director (Finance), NTPC
CMD provided a scale of NTPC’s upcoming investment in Pudimadaka and the strategic flexibility in its model.
“The Pudimadaka itself is going to be around INR 85,000 crore total investment. Whether we are going to do from total on the balance sheet of NGEL, or whether we can also try to start having the model of facilitating others and try to charge. This can be a kind of SEZ model where you can enable people to come, and you can charge on that… But there will be a sizeable investment from our side. Because at the end, this is the coastal location, and this will be proving to be a good export-oriented place.”
— Gurdeep Singh, Chairman & Managing Director, NTPC
CMD gave investors a sense of the economics of nuclear power in India.
“The whole exercise which is going on is that how to reduce the time of execution and how to make it completely indigenous so that the cost will remain under control. So, there are some estimates as of now that it will be somewhere between INR 15 crore to INR 20 crore per megawatt. If that is going to be the cost, tariff will be in the range of anywhere between INR 6 to INR 8.”
— Gurdeep Singh, Chairman & Managing Director, NTPC
Financial Services
Muthoot Finance | Large Cap | Financial Services
Muthoot Finance specializes in providing quick, affordable, and secure gold-backed financing with flexible repayment options and attractive interest rates. Alongside gold loans, the company offers personal and business loans, expanding its presence across the country.
Management was asked whether aggressive rate cuts by peers impact their strategy.
“So the gold loan business is to the flavor of the market. So all competitions are trying to come there. So people come with different strategies. Muthoot has been a long player in this, a very old player in this. And we have our own strategies. And I don’t think we need to respond to small strategy changes by others. We will go our way, as we are -- we have been in the market for such a long time. I don’t think these things matter to us.”
— George Muthoot, MD
Management gave its view on the final guidelines for LTV norms.
“So I think if you want to know my view on the new regulation, I feel it is quite gold loan business friendly. The new revised guidelines are quite gold loan business friendly. It gives more flexibility and actually more product offering to the customer in the new regulation. And up to INR2.5 lakhs, the LTV has been revised from 75% to 85%. So any company who wants to give even up to 85%, there is flexibility. That is what I said, it gives more flexibility and we can give more products to the customer also. And for your information, 85% of customers are below INR2.5 lakhs.”
— George Muthoot, MD
CFO explained why opex improved and how scaling helps efficiency.
“See, opex, yes, we are better because the AUM is going up. Per branch business is also going up. Per branch business, which is much lower earlier, today is more than INR25 crores. So as the per branch business goes up, proportionately a part of the opex also will come down. Of course, there is inflation and other things to consider. But if any company wants to reduce the opex, they have to increase the per branch business. So if this time, the opex has come down, it is because we had an INR10,000 crores growth in the AUM.”
— Oommen Mammen, CFO
Poonawala Poonawalla Fincorp | Small Cap | Financial Services
Poonawalla Fincorp Limited, formerly known as Magma Fincorp Limited, provides finance through a widespread branch network across India. Specializing in consumer and MSME financing, it offers a diverse range of financial products to cater to the evolving needs of customers and businesses.
Management explained the secured vs. unsecured split in MSME lending.
“So, if you ask for MSME book, around 65%-70% of my business is mortgages which is LAP of which 75%-80% are all self-owned property. So, to that extent, the LAP book is behaving extremely well for us. So, it is secured if you ask me- overall, it is around 63%-70% is the range which I could give you.”
— Shriram Iyer, Chief Credit and Analytics Officer
Management emphasized MSME as a key focus area with controlled risk.
“But overall, MSME for us is going to be a very robust growth engine and I see a great opportunity both on the business side as well as I don’t see any concerns on the risk on the portfolio. Even our new calibrations and the way 30-60-90 is going, my assessment is that it’s a fantastic opportunity in terms of well-calibrated risk. As a matter of fact, if you look at our GNPA on that, it is fairly low right now and it is not a small size, and we are very focused on it being very well calibrated. We are not in any hurry. So, we are following our philosophy that it should be good quality and that is what we are doing. So, in our case, MSME, whether it is this or we double on this, the quality will be well calibrated. You can be rest assured. The GNPA on that is really low right now.”
— Arvind Kapil, MD & CEO
Management dismissed broad concerns about MSME sector stress, stressing risk calibration.
“So, MSME for us, I think what Shriram was alluding to, and he can chip in if he likes, is 63% of whatever MSME we do happens to be secure. So, that’s point, approximately ballpark what I heard him say. But more importantly, whether it’s secured or it’s unsecured, whether it’s loans against property, whether it’s business loans, or any of the other versions of MSME that we do, what I can assure you is, is extremely well calibrated on the risk side.
Now, industry might be going through its various, I don’t think there’s anything too unusual about when I was handling, before my previous assignment, a very large portfolio as well. I think we have always had these situations of MSMEs - always have to be very well risk-calibrated. I don’t see any storm in the industry in my assessment. These storms have always existed if you don’t calibrate it well. So, to blame the industry is not something I see that way. I see that if you’ve got to be well risk-calibrated, and the industry is what it was, I don’t think there’s a deterioration in the industry level, and I am not a large enough size to comment on it. So, I don’t see it that way. And so that’s what I like to share with you. As far as the book is concerned, it’s behaving really well right now. So, that’s all I can share with you. Our new calibration will be extremely well calibrated because that’s what we are here for. But I don’t even think industry is at any concern level, to be honest with you. If you don’t calibrate yourself well, it’s very easy to blame the industry.”
— Arvind Kapil, MD & CEO
Cholamandalam Investment and Finance | Large Cap | Financial Services
Cholamandalam Investment and Finance Company is an RBI-registered NBFC-UL, offering diversified financial services including Vehicle Finance, Home Loans, Loan against Property, SME loans, and Unsecured Loans.
Ravindra Kundu explained the internal measures being taken to manage stress and maintain growth guidance.
“Yes, so the calibration of underwriting and our collection mechanism is a continuous process and it actually improves when you have a tough time and as we mentioned about CSEL underwriting last year itself in the Quarter 4, that we cut down the number of enquiries. We have reduced the trade where we are giving the business loan and also, we were also very clear about it that some of the markets are basically negative in terms of repayment. So, we have done it from Quarter 4 itself.
In vehicle finance, they have been continuously improving their underwriting models. So, those are important things, and we also mentioned that this year is actually a year of collection, not the year of disbursement. So, we are trying our level best to ensure our first bucket collection is actually very good and roll forward rates are lower. And if you continue to do that, then obviously we will start getting benefit from quarter 3 onwards and in terms of the loan losses are concerned, loan losses are actually not because of the current collection. It is also because of the roll forward that happened in the past. So, our job is to ensure that whatever roll forward happened, how can we curtail into stage two or stage one in the next quarter and that is the reason we are saying that if the economy improves that will help us to achieve our goal.”
— Ravindra Kundu, MD & CEO
Question on why home loan growth slowed.
“In the housing loan, we said that this year we are not expanding and therefore disbursement growth will be lower and asset growth will be 30%... generally housing loan will be around 10% disbursement only for this year because we have not started expanding further and we are focusing more into OPEX deduction.”
— Ravindra Kundu
Management compared their performance against SIAM data.
“Industry all the manufacturers showing -5%… Against that, we have registered 7% growth. Most of the product line, we have achieved an increase in the market share… we are doing better than industry.”
— Ravindra Kundu
Asked if they are being aggressive despite stress.
“Two years back we cut down tractor funding and two-wheeler funding ahead of the time… but now that is not the case and our vehicle finance is predominantly into the rural market… last year onward, the monsoon is actually looking better. That is the reason some of the products… we started focusing more on.”
— Ravindra Kundu
Question on why expand when stress is visible.
“When the market is looking bad, manufacturers are also down. And at that point in time, if they are coming to us, that is the best time to basically gain market share. When market is doing very well and you start gaining market, that is not a great idea.”
— Ravindra Kundu
Asked about synergies across product lines
“Around 25% of disbursement is actually coming from the existing customer… As of now, we are not cross-selling LAP against vehicle finance or vehicle finance against LAP… we are definitely making that transition from product-based views to a customer.”
— Vellayan Subbiah
Metals
Ashapura Minechem | Small Cap | Metals
Ashapura Minechem Limited is a leading multi-mineral solutions provider with a global footprint, having a wide network of operations Pan-India and in many other countries. The company is engaged in the mining, manufacturing and trading of various minerals and its derivative products and related services. From soaps to steel, energy to edible oils, metal to medicine and cement to ceramics, the company offers multi-mineral solutions across several industries.
Manan Shah detailed how mining contributes little to overall cost, with logistics dominating.
“Typically the mining cost is the very small part of the total cost. Typically in this entire thing the mining cost may be hardly a few percentage points of the total cost. The major cost is the transportation which happens from the mines to the port and then from the port via capsized vessels to our end users mostly in China, that is a significant part of the total cost. So that includes barging trans shippers if any and then finally the actual freight of the cargo being carried from Guinea to China. So majority of the cost involved is all related to logistics and can be a function of the performance of various sea routes in terms of how their pricing is faring is one of the basic impact of that. So the costing is majorly on the logistics and logistics management side which is predominantly what is on the costing. Regarding to your question and there are some taxes also in terms of to the government which has to be paid as royalties on the export so that also exists. So that is also as the some percentage of the total cost.”
— Manan Shah, Promoter Group, Ashapura Minechem Limited
Manan Shah explained how sales realization is tied to index prices and adjusted for quality.
“Regarding to the index pricing so the our pricing will always be linked to the index, but whether it’s a premium or penalty depends customer to customer based on the grade of bauxite which they would be buying and the kind of moisture which is in the material, but you can understand that our EBITDA would have a some correlation to index prices.”
— Manan Shah, Promoter Group, Ashapura Minechem Limited
Mishra Dhatu Nigam | Small Cap | Metals
Mishra Dhatu Nigam (MIDHANI) is a Government of India Enterprise under the Ministry of Defence focused on achieving self-reliance in the production and supply of super alloys, special steels, and materials for Defense, Nuclear, Aeronautical, and Space sectors.
Management was asked about opportunities in light of India’s push for indigenous fighter jet engines.
“Any fighter jet program or any aero-engine program basically it uses three kinds of strategic materials… very high strength steels, super alloys, and Titanium alloys… these are the three main materials for MIDHANI. We are very strong in all these things… in Kaveri engine program also, MIDHANI was closely associated with GTRE and we have developed a number of grades… we expect a significant number of orders for these upcoming projects also.”
— Dr. S.V.S. Narayana Murty, Chairman & Managing Director
Question on product portfolio evolution and global positioning.
“Our core strength is our new alloy development. We have about 500 types of alloys… about 100 grades are exclusively for aeronautical grade. With respect to additive manufacturing, yes, we wanted to go for powder manufacturing… we are in the process of establishing powder manufacturing facility because AM is coming up in a big way… we will be establishing facility for manufacture of strategic powders.”
— Dr. S.V.S. Narayana Murty, Chairman & Managing Director
Investor asked about three-to-five-year growth ambition.
“We are expecting in a time period of about five years our targets will be around ₹2,000 crores. That is a target we are looking at from the current ₹1,100 crores approximately… in strategic sector what happens is the quantities are small and the numbers are large… the required quality is very, very high. So, ₹2,000 crores is what we are looking for.”
— Dr. S.V.S. Narayana Murty, Chairman & Managing Director
A follow-up on earlier MD’s statement that “India needs five MIDHANIs.”
“My predecessor was 100% true, his words are absolute… even today if you look at the EXIM data, there are steels, super alloys and titanium alloys imported by around ₹8,000 crores every year… we need to strengthen. We need to expand. We need to become big. We need to cater. And all the Government of India’s idea is to have everything done within the country under Aatmanirbhar.”
— Dr. S.V.S. Narayana Murty, Chairman & Managing Director
CMD explained why supply chain dependence is one of the biggest challenges for the alloy business.
“Yes. This is one important challenge because many of the raw materials that we use for making the alloys are imported. And because of the global chain disruption, sometimes it happens that some of these raw materials that go into production of materials, alloys are not available in time. So it will put stress on us sometimes. Suppose say, for example, some materials or some strains are not available or some pure elements which we use in the manufacturing of these nickel-based super alloys, even if one element is not there, like typically a super alloy consists of six to seven elements. Absence of any one of the elements is going to be a critical thing. And one of our objectives is also to develop some domestic market, but it takes time. It will not happen immediately because these are all long, I mean, very heavy investments are required for making these elements, okay, whatever we import, if you want to make within the country, it takes time. So short term, yes, we want to meet the targets. And long term, we want to have some collaborations and all, how to recover, maybe some of these alloy elements if they are possible to recycle and use, that also we are looking. So supply chain is a very, very important thing in our type of production, where we depend on external countries for resources.”
— Dr. S.V.S. Narayana Murty, Chairman & Managing Director
Auto Ancillary
Precision Camshafts Limited | Small Cap | Auto Ancillary
Precision Camshafts Limited is one of the world’s leading manufacturers and supplier of camshafts, a critical engine component, in the passenger vehicle segment based on its estimated global market share by volume. The company supplies several varieties of camshafts for passenger vehicles, tractors, light commercial vehicles and locomotive engine applications
Ketan Chheda asked whether standalone revenues have plateaued.
“Yes, okay. So, even with that, I think there is growth. The Indian market is growing. We are a significant source to all the major OEMs across India and wherever there is growth with the OEMs, we are growing along with them. The only thing that is offsetting this is, of course, the significant slowdown in Europe that we are facing right now. It has a tremendous impact on what we do and from one week to the other, there are drops in volumes of 20%, 30% which is unprecedented or not planned. Despite these drops in volumes, we are able to maintain our capacity utilization as well as our revenues because of the addition in business in India.”
— Karan Shah, Whole Time Director, Business Development
Karan Shah elaborated on future revenue drivers.
“Second, while this is the current business that we have, we have acquired new business from customers in India and overseas that will go on to production later this year, later this calendar year or by mid of 2026. All of this will surely add to the turnover that we have today and for which we are also incurring a lot of CAPEX during this current year and in the last year as well. So, there will be growth but at this point of time, what is happening is the slowdown in Europe as well as the complete uncertainty of what is happening in the American market. Despite that slowdown, we are able to offset that with the growth in the Indian market.”
— Karan Shah, Whole Time Director, Business Development
Analyst pressed for order size expectations.
“No, so it is very difficult to do that right now because we are still at the very beginning of this journey. We are still trying to see where we can expand and whatnot. Right now, we have this LCV conversion that we are talking about, which we have the orders for in various cities. But we also have this HCV product, which is a high-end product. It is for a very niche customer. The selling price and the margins there are very different. To give you an example, the LCV that we do conversions for is in the Rs. 5 lakh to Rs. 6 lakh rupee range per vehicle, whereas the HCV conversions are in the Rs. 70 lakh to Rs. 80 lakh rupees per vehicle kind of conversion. So, we are still consolidated on all the numbers. We are still putting together the plans and so on. So, it is very difficult for me to give you a number today, like what the next financial year looks like in terms of revenue. But for sure, there is slow and steady growth in this business. It is, like I have mentioned in my previous calls, it is much slower than what we have expected due to the various challenges in the ecosystem altogether but moving slowly.”
— Karan Shah, Whole Time Director, Business Development
Karan Shah reports that the company returned to profitability driven by growth in their domestic Indian business which is offsetting challenges faced in Europe.
“These are domestic orders. The new orders that I am talking about are in India. This particular order we are talking about is in several hundreds, but it is done in phases, of course. No customer is willing to retrofit a very large fleet in one go because you can understand that these vehicles are pulled out of operations to be converted and then put back into operations. So, typically it is in small batches of fifteen to twenty vehicles at a time. But if you look at this customer, they are spread across India and we have a commitment of several hundred vehicles that we want to convert for this customer and we are starting in very key cities like Mumbai, Pune and Nagpur at this point.”
— Karan Shah, Whole Time Director, Business Development
JBM Auto | Small Cap | Auto Ancillary
JBM Auto Limited is a company in the automotive industry that specializes in manufacturing and selling sheet metal components, tools, dies & moulds, buses, spare parts, accessories, and maintenance contracts.
Nishant Arya highlighted the strategic importance of the UAE entry.
“This is a very positive step in our global expansion journey. Last year, we entered new international markets, and now with the UAE, we are partnering with Al Habtoor Group, one of the leading automotive players in the region with a strong presence across multiple segments. We see this as a cornerstone for our growth, and the Middle East will contribute significantly to our EV business going forward.”
— Nishant Arya, VC & MD
He explained that profitability will be in line with India, but scale is the bigger focus.
“Margins in the UAE will be similar to those in India, but the real focus is on scaling up and bringing in new applications in the region. Our goal, along with Al Habtoor, is to become one of the top two players in the UAE and then expand into the wider Middle East. Over the next 5–6 years, we expect the Middle East and Africa to contribute around 10–12% of our revenues.”
— Nishant Arya, VC & MD
Management shared details of their robust order book and Middle East targets.
“We currently have an order book of more than 10,000 buses, out of which we have already executed a part over the last two quarters. In the Middle East and Africa specifically, we are targeting more than 3,000 buses in the next 5–6 years. We have already supplied some buses in the UAE to local customers, incubating the market and strengthening our partnership with Al Habtoor.”
— Nishant Arya, VC & MD
Arya underlined how IFC’s backing strengthens their EV deployment plan.
“The IFC investment in JBM’s Ecoife Mobility will support the deployment of about 1,500 electric buses across Maharashtra, Gujarat, and Assam over the next year. This partnership is a big boost for us, as working with a global institution like IFC (part of the World Bank Group) validates our strategy. Beyond deploying zero-emission buses, this initiative will create multiple jobs and a wider ecosystem for green mobility solutions.”
— Nishant Arya, VC & MD
International
Virgin Galactic Holdings, Inc. | International
Virgin Galactic is a private spaceflight company focused on designing, manufacturing, and operating air and space vehicles to provide suborbital space tourism to private individuals, researchers, and government agencies. They are pioneering human spaceflight for the masses, aiming to make space travel more accessible and affordable by developing reusable spacecraft launched from an air carrier.
[Concall]
Business model targets $450M revenue and $100M EBITDA with initial fleet, scaling to $1B revenue and $500M EBITDA with expanded fleet.
“To revisit the suborbital spaceflight business model when our initial fleet of two spaceships and existing launch vehicle reaches steady-state operation is expected to support 125 flights per year, ramp to approximately $450 million in revenue and generate $100 million of adjusted EBITDA. By expanding our fleet with a second launch vehicle and two more spaceships, we expect to grow our business to approximately $1 billion in revenue and yield $500 million of adjusted EBITDA.”
– Doug Ahrens (CFO)
First spaceflight pushed from summer to fall 2026 due to fuselage manufacturing issues but commercial timeline maintained.
“While we continue to carry schedule contingency for the remaining phases of our spaceship program, we expect the fuselage skin will have a modest impact on the timeline for completing assembly of our first spaceship. This is why we’ve adjusted the expected timing of our first space flight to the fall of 26 with private astronaut flights still expected to commence later in the fall of 26. We continue to track for launch of our commercial spaceflight business in 2026 with both research and private astronaut flights expected to commence in the fall next year.”
– Michael Colglazier (CEO)
Crocs, Inc.| International
Crocs, Inc. is a global footwear company that designs, develops, markets, and distributes casual lifestyle footwear and accessories under its own brands, Crocs and HEYDUDE, and through wholesale and direct-to-consumer channels. The company is known for its comfortable, innovative footwear, such as clogs and sandals, made with proprietary foam technologies like Croslite.
[Concall]
Tariff impact quantified at $40M for H2 2025 and $90M annually based on current sourcing mix.
“Last week, the US extended the pause period on a series of incremental tariffs on countries in which we source our product. While we can’t predict future tariff changes, we are planning our business at the current rates. The impact from these incremental rates equates to approximately $40 million in the second half of 2025 and approximately $90 million on an annual basis based on our current sourcing mix.”
– Susan Healey (CFO)
$737M non-cash impairment charge on Hey Dude due to extended stabilization timeline and tariff impacts.
“This excludes the non-cash impairment charge of $737 million on Hey Dude’s intangible assets. This impairment comes as a result of a longer than expected timeline to stabilize the Hey Dude brand and return it to growth due in part to a weaker US consumer and the disproportionate impact of tariffs on Hey Dude product.”
– Susan Healey (CFO)
Athletic footwear trend expected to persist through World Cup 2026 and LA Olympics, creating headwinds.
“I think there is an athletic trend in the marketplace. I think everybody’s well aware of that. The consumer is migrating back towards athletic. We know that is a cyclical trend and as we look at some key athletic events coming up. We do think that will persist for a while. You’ve got the World Cup next year. You have the LA Olympics in a couple of years.”
– Andrew Reese (CEO)
Krispy Kreme, Inc. | International
Krispy Kreme creates and sells donuts, coffee, and other sweet treats.
[Concall]
McDonald’s USA partnership terminated and 1,500 underperforming doors being closed due to unsustainable economics.
“First, as announced in June, we have ended our McDonald’s USA partnership effective July 2nd. Our efforts to bring our costs related to the partnership in line with unit demand were unsuccessful, making it unsustainable for us. Second, excluding the exited McDonald’s doors, we also completed a thorough assessment of our US fresh delivery footprint and identified approximately 1,500 underperforming doors. We’ve already exited more than half of these in the first half of the year with plans to complete the remaining closures by year end.”
– Josh Charlesworth (CEO)
International equity markets delivered 5.9% organic growth driven by hub-and-spoke expansion in Canada and Japan.
“Within our equity owned international markets organic revenue grew 5.9% driven by point of access growth in Canada and Japan. These markets continue to see the benefit of rolling out our hub and spoke model in a targeted fashion geared towards strategic customers and driving expansion with new shop development generating significant foot traffic. This includes Costco and new theaters in Canada as well as new theaters in Mexico and Japan.”
– Raphael Duvier (CFO)
Micron Technology, Inc. | International
Micron Technology designs, manufactures, and sells computer memory and data storage products, including DRAM, NAND flash memory, and solid-state drives (SSDs). Their memory and storage solutions are essential components in a wide range of devices and markets, such as smartphones, PCs, data centers, AI, automotive, and industrial applications.
[Concall]
HBM4 samples delivered with industry-leading 2.8TB/s bandwidth and 11Gbps pin speeds, partnering with TSMC for HBM4E.
“We have recently shipped customer samples of our HBM4 with industry-leading bandwidth exceeding 2.8 terabytes per second and pin speeds over 11 Gbps per second. We believe Micron’s HBM4 outperforms all competing HBM4 products, delivering industry-leading performance as well as best-in-class power efficiency. We are partnering with TSMC for manufacturing the HBM4E base logic die for both standard and customized products.”
– Sanjay Mehrotra (CEO)
AI delivering 30-40% productivity gains in code generation with 5x increase in wafer image analysis in manufacturing.
“We are using AI throughout the company across product design, technology development, manufacturing, and other functional groups. We have seen strong adoption and as much as a 30% to 40% productivity uplift in select Gen AI use cases such as code generation. In manufacturing, we have driven a 5x increase in wafer images analyzed in the past year and double the amount of useful data and telemetry collected and analyzed from our fab tools.”
– Sanjay Mehrotra (CEO)
Hanesbrands Inc. | international
Hanesbrands Inc. is a global apparel manufacturer and marketer of innerwear and activewear, including brands like Hanes, Bali, Maidenform, and Playtex.
[Concall]
Tariff costs won’t hit until Q4 but company confident it can fully mitigate impacts through various strategies.
“When you think about tariffs and the impact on our business, first of all, we won’t be really experiencing that cost until Q4 because of the inventory that we have and the way cost flows off of our balance sheet, but we’re very confident that we will mitigate the tariffs at the rates that we’re experiencing today. We have very clear plans to do that. And as you think about our business, not only do you have the Q4 impact, but you have to think about those other offsets about meaningful US content that we have in our products that are exempt from reciprocal, the good east west balance that we have in our supply chain.”
– Scott Lewis (CFO)
Company implementing AI for operational improvements in inventory management, assortment planning and demand forecasting.
“We’re leveraging advanced analytics with the use of AI to drive operational improvement around the globe, including inventory and assortment management, as well as demand planning and forecasting. We’ve streamlined our supply chain while remaining diversified and balanced across the globe, which makes us more efficient and provides us with capacity for growth.”
– Steve Bratspies (CEO)
Novavax | International
Novavax develops and markets vaccines for infectious diseases, such as the Nuvaxovid™ 2025-2026 Formula COVID-19 vaccine. Their approach differs from mRNA vaccines, using a protein-based platform to prevent illness.
[Concall]
Signed MTAs with three pharma companies exploring Matrix-M in oncology and other novel indications.
“This quarter, we continue to advance strategic opportunities for our matrix M adjuvant. To date, we’ve signed material transfer agreements with three pharmaceutical companies to explore the utility of MatrixM across novel indications, including its potential application in oncology. These arrangements have led to discussions about potential business partnerships to develop new vaccines and improve existing vaccines.”
– John Jacobs (CEO)
That’s it for now! Your feedback will really help shape how The Chatter evolves. Drop it down in the comments below!
Quotes in this newsletter were curated by Meher, Vignesh & Kashish.
Disclaimer: We’ve used AI tools in filtering and cleaning up these quotes so there maybe some mistakes. Now, if you are thinking why we are using AI, please remember that we are just a small team of 5 people running everything you see on Zerodha Markets 😬 So, all the good stuff is human and mistakes are AI.
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The Crocs section caught my attention, particularly the HeyDude impairment writedown. It's intresting that management is being pretty transparent about the longer stabilization timeline for HeyDude rather than trying to sugarcoat it. The $737M non cash impairment is massive but honestly seems like the right move to recalibrate expectations. I think the tariff impact numbers are pretty substanital at $90M annually, but with Asia still growing strong for Crocs core brand, they have geographic diversification on their side. The athletic footwear cycle headwind you mentioned is real, but Crocs has kind of positioned themselves in a different lane where comfort trumps pure athletic fashion. If they can navigate through the World Cup and LA Olympics period without losing too much share, they might actually emerge stronger when the trend inevitebly swings back.