The Chatter: Swiggy, Hyundai, Shree Cement & More
Edition #52
Welcome to the 52nd 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 an international features.
Financial Services
Yes Bank
HDFC Asset Management Company
Canara Bank
AU Small Finance Bank
Metal
MOIL Ltd.
Energy
Power Grid Corporation
Torrent Power Limited
Building Material
Shree Digvijay Cement
Shree Cement Limited
Engineering & Capital Goods
KSB Limited
Rail Vikas Nigam Limited
Suzlon Energy Limited
Auto
CEAT Limited
TVS Motor Company
Uno Minda Limited
Hyundai Motor India
Retail
Swiggy Limited
Varun Beverages
Voltas Limited
International
Saudi Aramco
Financial Services
YES Bank Limited | Large Cap | Private Sector Bank
YES Bank is a major Indian private sector bank offering a wide range of products across retail, corporate, and SME segments. The bank has successfully undergone a structural transformation focused on asset quality improvement, deposit granularity, and cost efficiency.
[Concall]
The bank is successfully reducing its exposure to low-earning legacy government investments. This move frees up funds to be reinvested into higher-interest loans, which will naturally improve the bank’s interest margins.
Rural Infrastructure Development Fund (RIDF) balances represent mandatory deposits made by commercial banks into NABARD to cover shortfalls in Priority Sector Lending (PSL) targets, particularly for agriculture.
“As a result, our RIDF balances have continued their steady decline from a peak of around 11% in FY ‘24, to around 6.9% in quarter 3, and Bank remains well on track to further reduce it to below 5% of Total Assets by FY ‘27 in line with our guidance.”
— Prashant Kumar, Managing Director and Chief Executive Officer
The bank is intentionally avoiding very competitive loan markets where the profit margins are currently too thin. This focus on high-return lending protects the bank’s capital from being tied up in low-profit activities.
“In the Retail segment, it is important to note that the Bank has strategically chosen not to pursue aggressive growth in two major product categories, that is the Home Loans and new Car Loans, as these product sub-segments currently do not generate attractive risk-adjusted returns.”
— Prashant Kumar, Managing Director and Chief Executive Officer
Bank branches are being transformed into sales hubs for various financial products rather than just being used for taking deposits. This multi-purpose use of the branch network increases the overall revenue generated from each physical location.
“Our strategy is designed to leverage this physical network, not just for gathering liabilities, but as multi-product engines, capable of generating assets, fee income and high-velocity transaction flows.”
— Prashant Kumar, Managing Director and Chief Executive Officer
The bank has been more aggressive than its peers in lowering the interest rates it pays to depositors. This indicates strong brand trust, allowing the bank to maintain deposit growth while lowering its cost of funds.
“Along with this, the Bank has also maintained a strong focus on sustained reduction in its Cost of Deposits which has reduced to 5.6% from 6.1% last year, driven by higher deposit-rate cuts relative to the rate cuts undertaken by RBI and competitors.”
— Prashant Kumar, Managing Director and Chief Executive Officer
The amount of new loans turning into bad debt has dropped to a two-year low. Improving asset quality reduces the need for emergency provisions and makes the bank’s earnings much more predictable.
“Similarly, the Quarter 3 was the second consecutive quarter of improvement in overall Fresh Slippages, which were contained at INR 1,050 crores... This is the lowest slippage level seen in last eight quarters.”
— Prashant Kumar, Managing Director and Chief Executive Officer
The retail division has finally reached a point where its income covers its costs, ending a long investment cycle. This segment will now start contributing positively to the bank’s total profit rather than being a drag on resources.
“I’m really happy to report that this quarter, our Retail businesses have breakeven, and going forward, we would be going to see a significant contribution in the Profitability of the Bank from the Retail.”
— Prashant Kumar, Managing Director and Chief Executive Officer
The number of credit card customers missing payments has dropped sharply, indicating a much healthier loan portfolio. Better behavior in high-risk segments like credit cards supports higher overall margins for the bank.
“So entry rates in cards from 20% is down to around 12% which gives us significant confidence on the way things are panning out... both in terms of entry rates, resolution and slippage and recovery, each of the product, including cards, is showing a significant improvement.”
— Rajan Pental, Executive Director
HDFC Asset Management Company Limited | Large Cap | Asset Management
HDFC Asset Management Company is one of India’s largest mutual fund managers, offering a diverse range of investment products across equity and fixed income. The company leverages a vast distribution network and the strong HDFC brand to serve millions of retail and institutional investors.
[Concall]
HDFC AMC is successfully expanding its footprint into high-margin alternative investment vehicles like private credit. This diversification allows the company to tap into sophisticated capital pools beyond traditional retail mutual funds.
“In alternatives, we completed the first close of our structured credit fund, raising commitments of approximately INR13 billion from institutions, family offices and UHNI investors.”
— Simal Kanuga, Chief Investor Relations Officer
As the company’s funds grow larger, regulatory rules force them to charge lower fees to investors. This natural fee compression means the company must focus on operating efficiency to maintain its historical profitability levels.
“On the equity margins, I mentioned that some degree of compression is inevitable over time because you have a sliding scale structure of TER, so which naturally leads to lower expense ratio as the AUM scales.”
— Navneet Munot, Managing Director and CEO
Recent regulatory changes removing certain fee allowances will noticeably reduce the revenue potential for all asset management companies. This creates a headwind that the industry must navigate through cost management or volume growth. But, lower regulatory fees make large mutual funds more attractive by improving their net returns relative to the market index. This could lead to further consolidation where larger, established players attract more capital than smaller rivals.
“Removal of 5 basis points of additional TER, which AMCs were allowed to charge in lieu of exit load... The impact for the industry as a whole is definitely material.”
“The positive side of this change, if I can highlight, one is reduced TER and hence, even better alpha. So clearly in favor of larger sized funds.”
— Navneet Munot, Managing Director and CEO
The company is currently returning nearly all of its annual earnings to shareholders in the form of dividends. This highlights the asset-light nature of the business and a strong commitment to shareholder rewards.
“Our dividend payouts for the last two years have been almost close to the entire post-tax cash profits that we generate as a business.”
— Naozad Sirwalla, Chief Financial Officer
Management is open to using its cash reserves to launch new fund categories or acquire other businesses if the price is right. Investors can expect potential inorganic growth if an opportunity aligns with their strategic goals.
“We will use the balance sheet judiciously for seeding businesses... And the third option of strategic acquisitions always is on the table.”
— Naozad Sirwalla, Chief Financial Officer
Canara Bank | Large Cap | Public Sector Bank
Canara Bank is one of India’s largest public sector banks, offering a wide range of retail, corporate, and agricultural banking services. The bank is currently focused on optimizing its credit mix through its RAM (Retail, Agriculture, and MSME) strategy to drive profitability.
[Concall]
Management has met or exceeded almost all strategic targets for the fiscal year except for margin-related metrics. This demonstrates strong execution capabilities despite broader industry-wide pressure on low-cost deposits.
“In the beginning of the year, we have given guidance numbers for 13 parameters, and we have easily surpassed and comfortably surpassed 11 parameters, except CASA and NIM, which is industry challenge.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The bank plans to lean into its strong retail lending momentum to drive future credit growth. This shift towards granular retail loans typically helps in diversifying risk and improving yields.
“Our strategy going ahead is to further capitalize because if you see our guidance number on advances, our advances growth is more than 13.59%. So… to capitalize on this Retail momentum that has been built.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The transition to new accounting standards for bad loan provisions will require an estimated 10,000 crore buffer. The ability to spread this cost over four years makes the financial impact manageable relative to the bank’s annual profits.
“In the ECL under Stage 2… provisioning increases from 0.4 to 5%. And there we see that 2,500 crores additional provision will be required... If I total that one, it will come around 10,000 crores, and that can be amortized in 4 years. The impact may come to 2,000 to 2,500 crores.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The stock of potential problem loans is declining even as the overall loan book grows. This suggests that the bank’s underwriting standards are effective and future credit losses are likely to stay low.
“Total SMA is 35,604 crores. Last year in December, it was 43,917 crores... Our SMA, on absolute numbers, it has come down from 43,917 crores to 35,604 crores. So, that’s a credible achievement, I tell you. And slippage also, it is in absolute control.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The bank continues to benefit from selling its excess priority sector lending credits to other banks. This provides a high-margin, sustainable stream of fee income that bolsters the non-interest revenue.
“From a PSLC perspective, we don’t see much difference... There will always be surplus and deficient players of PSLC, and Canara Bank has that advantage.”
— Shri S.K. Majumdar, Executive Director
Operating expenses this quarter were elevated by roughly 250 crores due to one-time costs related to subsidiary listings and employee benefits. Investors should view the current cost structure as slightly higher than the normalized run rate.
“One was IPO charges for Canara Robeco and Canara HSBC. That needs to be absorbed by the promoter. So, for that, there is a fee of around 80 crores. Another 80 crores is of depreciation... that is around 160 crores. This is more or less around 250 crore, which is additional, which is not of a routine nature.”
— Shri S.K. Majumdar, Executive Director
Divestments in subsidiary companies contributed over 2,000 crores to the bank’s quarterly profit. This unlocks value from non-banking units and strengthens the bank’s overall capital position.
“In Q3, due to listing profits of Canara Robeco and Canara HSBC… in Canara HSBC we offloaded 14.5% stake, and in Canara Robeco we offloaded 13% stake and could gain 2,006 crores.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The bank is intentionally slowing its lending to large NBFCs to avoid low-yielding loans. This disciplined approach prioritizes margin protection over simple volume growth.
“The NBFC exposure is at 1,51,000 crores, and it is growing at 6.09%... normally the AA, AAA rated NBFCs, when they approach us, but the rates are not competitive, then we are shying away from that because protection of NIM is also our major criteria.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
Canara Bank is investing 1,000 crores annually into technology, including a dedicated AI department for fraud and default prediction. These investments are intended to drive long-term operational efficiency and risk management.
“A vertical has been created separately for AI which is working on identification of use cases that can be implemented in the bank... Around 1,000 crores we are spending annually on digital initiatives.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
The bank generates enough internal profit to fund its growth without needing to issue new shares. This is positive for investors as it avoids equity dilution in the near term.
“We are adding around 17,000 to 20,000 profit per annum. So there is no reason… I mean, as of now, we are adequately capitalized to do business... In the immediate future, I don’t think bank will require that [QIP].”
— Shri S.K. Majumdar, Executive Director
The bank’s fastest-growing segments are also its high-yielding segments, particularly gold and retail loans. This alignment between growth and yield supports the bank’s long-term profitability goals.
“RAM sector is the strength which is growing at 18.70% and where the yield is also 8.88%... gold is also growing at 30% where the yield is around 9%.”
— Shri Hardeep Singh Ahluwalia, MD & CEO
AU Small Finance Bank Limited | Mid Cap | Private Sector Bank
AU Small Finance Bank is a leading Indian retail bank that provides financial services across vehicle finance, MSME loans, and housing finance. The bank recently transitioned into a larger franchise following its merger with Fincare SFB and is currently optimizing its digital and AI capabilities for scale.
[Concall]
Recovery in the microfinance segment has reached its best level in over a year, signaling the end of a difficult credit cycle. This stabilization reduces the risk profile of the bank’s unsecured portfolio and suggests lower future provisioning needs.
“Non-overdue collection efficiency in MFI improved to near-normal levels at 99.3% for the quarter and 99.5% for the month of December, the highest in six quarters.”
— Gaurav Jain, Interim CFO
The bank has significantly de-risked its microfinance exposure by securing government-backed credit guarantees for the majority of the portfolio. This protection limits the potential downside for investors in the event of future systemic stress in the micro-lending sector.
“83% of the MFI book is now covered under the CGFMU Guarantee Scheme, providing protection against any potential credit losses in the future.”
— Gaurav Jain, Interim CFO
Management is cautiously optimistic about resuming growth in the microfinance segment after a period of consolidation. New growth in this high-yield segment could boost overall margins if the current collection discipline is maintained.
“We are seeing green shoots in MFI business... you will see some sort of growth in MFI business for next year. But difficult to quantify in this call. We would be ready to do this kind of decision-making by April.”
— Sanjay Agarwal, MD & CEO
The bank is prioritizing caution in its credit card portfolio for another year to ensure long-term stability rather than chasing immediate growth. This measured approach suggests management is focused on quality over quantity in the unsecured lending space.
“Credit card business will go for another one year for the readjustment and settling down. And personal loan, of course, we are banking big on the whole STP journeys.”
— Sanjay Agarwal, MD & CEO
The bank will continue to lead with its core secured retail products, which offer a proven balance of risk and reward. Investors should view this as a commitment to the bank’s foundational strengths rather than pivoting to riskier new segments.
“We believe we are stronger in our retail asset strategy where wheels, mortgages, gold loan will take the front seat. We want to push our system engine there as much as possible.”
— Sanjay Agarwal, MD & CEO
Management emphasizes that their liquidity and credit-to-deposit ratios are managed with internal prudence that exceeds regulatory requirements. This focus on self-governance provides a safety cushion for investors against liquidity shocks in the banking system.
“The risk of deposit is 80% of the book, which is the CD ratio of 80%... the idea is to tell you that how solid we are in terms of our approach is not about the regulator pushing us... it is about how we want to really build ourselves on a self-governance basis.”
— Sanjay Agarwal, MD & CEO
Metals
MOIL Ltd. | Small Cap | Metals
MOIL Limited, a Schedule ‘A’ Miniratna Category-I Company, is a leading producer of different grades of Manganese Ore in India. Their product range includes High Grade Ores, Medium grade ore, Blast furnace grade ore, and Dioxide for various industries. MOIL fulfills half of India’s dioxide ore requirement and has also ventured into renewable energy with wind farms in Madhya Pradesh.
[Concall]
MOIL maintains a pricing strategy that consistently sets its domestic manganese ore prices 5-6% higher than imported prices, ensuring it captures market movements and maintains a premium.
“Our prices are always kept about 5% to 6% higher than the imported prices. So whatever movement is there in the index, that is captured in our prices... our prices will always increase slightly more than the international prices. Always, as a rule.”
— Rashmi Singh, Director Commercial
The decreasing manganese ore inventory at Chinese ports from 6 million to 4.3-4.4 million tons is a significant factor supporting upward price movements in the international market.
“inventory at Chinese ports is also one of the major factors which determine the price movement... inventory has been coming down. Earlier, it used to be around 6 million ton. Currently it’s about 4.3 million, 4.4 million ton, so inventory is low.”
— Rashmi Singh, Director Commercial
MOIL has a total capex target of INR600 crores for the current year, allocating INR325 crores for existing mine modernization and INR275 crores for potential overseas acquisitions.
“This year our capex is around INR600 crores target is there... Of this INR325 crores we are trying to achieve in our mines itself... And INR275 crores we have marked for the overseas acquisition.”
— Rakesh Tumane, Director, Finance
MOIL expects its cost of production to significantly decrease due to increased outsourcing, mechanization, and a shift to the highly productive long-hole open stoping mining method, which will reduce reliance on its substantial 48% manpower cost.
“And the way we are operating our mines is that we would be doing more of outsourcing... And we are, as Abdullah saab said, we’ll be doing more and more of mechanization... from conventional cut and fill method which is very laborious... to a long hole open stoping which is very, very productive. It is 5x to 6x or 10x more productive... So the cost of production will go down because at the moment the biggest portion of our cost of production is our manpower, which is almost around 48% something.”
— Rakesh Tumane, Director, Finance
MOIL’s cost of production for manganese ore was approximately INR 5,500 per ton in FY25 and is expected to decrease this year, positioning it competitively globally.
“last year, that is ‘24-’25 our cost of production was around... INR 5,500 per ton and this year would be around 53 something so there will be reduction in the cost of production... This is the Q1 kind of the cost of production. It is very competitive.”
— Rakesh Tumane, Director, Finance
MOIL is actively pursuing mechanization and experimenting with changing its mining methods to the more productive long-hole stoping, aiming to enhance efficiency.
“In addition to that, we are going for mechanization also... We are deploying some LHDs, SDL machines in underground and we are also thinking of changing our method of mining from conventional cut and fill to long hole stoping method also that experiments are also going on.”
— M.M. Abdulla, Director, Prod. & Plng.
Energy
Power Grid Corporation | Large Cap | Energy
Power Grid Corporation Of India operates a transmission network for power distribution and has diversified into telecom services by utilizing its transmission infrastructure. The company also offers consultancy services in areas such as power transmission, sub transmission, and distribution management.
[Concall]
Emerging technologies and industrial growth are projected to be major drivers of electricity demand, creating a robust growth environment for transmission infrastructure.
“Electricity demand is set to increase significantly as we move toward 2047, driven by data centers, artificial intelligence, electric vehicles, and industrial electrification.”
— Dr. R.K. Tyagi, Chairman and Managing Director
Aggressive renewable energy targets by 2035 necessitate substantial investment in long-distance transmission infrastructure for green energy evacuation.
“Renewable energy expansion, as per the 2035 CEA guidelines, suggests we will have 786 gigawatt of renewable capacity, with a total capacity of approximately 1,100 gigawatt. This will require long-distance green evacuation transmission systems.”
— Dr. R.K. Tyagi, Chairman and Managing Director
The company projects significant year-over-year growth in capital expenditure, with a substantial increase to over 82,000 crores by FY28, indicating a strong pipeline of projects.
“Looking ahead, our capex for next year is committed at 37,000 crores, though it will likely be higher. For FY27, it will reach 45,000 crores, and by FY28, it is projected to be more than 82,000 crores.”
— Dr. R.K. Tyagi, Chairman and Managing Director
The company forecasts a massive long-term market opportunity for transmission projects, potentially reaching 15 trillion rupees, driven by domestic demand and international interconnections.
“The 10-year visibility for transmission projects is approximately 8 trillion rupees based on peak demand projections of 459 gigawatt by 2035. If we include international interconnections with countries like Sri Lanka, UAE, Saudi Arabia, and Singapore, plus the Brahmaputra basin projects, the total visibility increases to approximately 15 trillion rupees.”
— Dr. R.K. Tyagi, Chairman and Managing Director
The company anticipates executing a substantial volume of projects, averaging 60,000 crores annually, by leveraging a high capture rate on its extensive project pipeline.
“We have visibility of 900,000 crore worth of projects up to 2035. Even at a 60% capture rate, we expect to execute 600,000 crores in projects by 2035, averaging 60,000 crores per year.”
— Dr. R.K. Tyagi, Chairman and Managing Director
The company is undergoing a strategic restructuring by merging numerous Special Purpose Vehicles (SPVs) and subsidiaries to enhance administrative efficiency and streamline management.
“Regarding governance, we have received approval to merge 19 SPVs into two. We are also pursuing the merger of 28 wholly-owned subsidiaries into two further entities. This will reduce administrative complexity and improve management.”
— Dr. R.K. Tyagi, Chairman and Managing Director
The company demonstrates strong financial health and capital allocation capability, indicating sufficient internal accruals to fund substantial annual capital expenditure requirements even after dividend payouts.
“Over the next 10 years, we anticipate an average annual requirement of 60,000 to 70,000 crores... Even after dividends, we will have enough to cover the equity requirements for a 70,000 crore annual capex.”
— Management, Company Leadership
Project commissioning timelines are shifting to a more realistic 30-36 month range, acknowledging past challenges with Right of Way and supply chain, which should improve project predictability.
“We have advised the government that 18-24 months is often not feasible due to ROW and supply chain issues. Most new projects are now being tendered with 30-36 month timelines, which we believe are realistic and achievable.”
— Management, Company Leadership
The company is adopting a selective approach to intra-state projects and seeking partnerships in the competitive Battery Energy Storage Systems (BESS) market to optimize costs and focus on high-value opportunities.
“We are participating in intra-state projects but are selective, as smaller projects require the same administrative effort as larger ones. In BESS, competition is high from smaller players. We are refining our methodology and seeking tie-ups with battery suppliers to optimize costs.”
— Management, Company Leadership
Torrent Power Limited | Large Cap | Energy
Torrent Power is an integrated Indian utility company involved in power generation, transmission, and distribution. It operates a diverse portfolio of coal, gas, and renewable energy assets across various Indian states.
[Concall]
Torrent Power is acquiring a major thermal power asset from L&T to expand its generation capacity. This acquisition significantly boosts the company’s operational portfolio with a high-efficiency supercritical plant.
“As communicated earlier today, we have entered into a definitive agreement with L&T to acquire a 100% equity stake in Nabha Power Limited. Nabha Power operates a 1.4 GW supercritical coal-based power plant located at Rajpura, Punjab.”
— Saurabh Mashruwala, Executive Director and CFO
The plant has a long-term contract in place for the next 13 years, ensuring stable revenue. The use of reliable technology suggests the plant will remain functional well beyond the current contract period.
“The PPA life is 25 years, which is fully contracted with the Punjab state discom. Out of these 25 years, the first 12 years are already over, and there are 13 years remaining. The plant was manufactured using reliable technology and is technically very sound.”
— Jagdish Mehta, Whole-time Director of Generation
The acquired site has enough space and infrastructure to support a significant brownfield expansion. Adding capacity at an existing site is usually faster and more cost-effective than starting a new project elsewhere.
“One additional module of 700 MW is possible at this site. Land is available. Once we take over the plant, we will evaluate how we can expand by adding that one module.”
— Jagdish Mehta, Whole-time Director of Generation
The plant’s pricing structure allows for full recovery of fuel costs, protecting the company from coal price spikes. This two-part tariff ensures consistent margins regardless of fluctuations in raw material prices.
“The capacity charge was about 1,400 crores, which works out to about Rs.1.49 per unit. The variable cost is roughly Rs.2.80 to Rs.2.90... it is completely recoverable.”
— Saurabh Mashruwala, Executive Director and CFO
The acquired company has significant tax credits that will lower tax payments for the next few years. This will result in higher net cash flows for the parent company in the short to medium term.
“They have net tax credits available. They are under the MAT regime right now, and we have credits available that will be used over the next 2-3 years.”
— Saurabh Mashruwala, Executive Director and CFO
The company has performed due diligence to account for past legal and regulatory disputes in the purchase price. This proactive approach helps mitigate the risk of unexpected costs from historical litigation.
“While doing the transaction, we ensured that major ongoing issues are either closed or appropriately factored into the valuation. Some regulatory issues are still pending but have been considered in our assessment.”
— Saurabh Mashruwala, Executive Director and CFO
Building Materials
Shree Digvijay Cement | Micro Cap | Building Materials
Shree Digvijay Cement Company Limited is one of India’s pioneer in manufacturing Cement. It started its operations in India in 1944 at the coastal township of Digvijaygram (Sikka) in Jamnagar District of Gujarat. Since 2019, it is a part of True North formerly known as India Value Fund Advisers (IVFA). The company has been a unique trendsetter in providing superior quality of Ordinary & Special Portland Cement.
The integration of Highbond Cement through a Brand Distribution Agreement is a strategic move designed to enhance the company’s capabilities and drive sustainable growth.
“Today’s discussion marks an important milestone as we integrate Highbond Cement with our operations as per the agreement. Under the brand, we have a Brand Distribution Agreement (BDA). This strategic move enhances our internal capabilities and positions us for sustainable growth.”
— Suresh Maher, Senior Vice President of Legal and Company Secretary
Shree Digvijay Cement will purchase cement from Highbond Cement at a fixed margin of INR 588 above cost and subsequently sell it at market prices.
“According to the BDA, Shree Digvijay Cement will purchase cement from Highbond Cement at cost plus a fixed margin of 588 rupees and we will sell it at the market price.”
— Vikas Kumar, Chief Financial Officer
The combined entity will achieve an installed capacity of approximately 5.2 million tons, establishing it as the third-largest cement player in Gujarat.
“The total installed capacity, including the alignment of both plants, is approximately 5.2 million tons. This makes us the third-largest player in Gujarat after UltraTech and Adani.”
— Vikas Kumar, Chief Financial Officer
The combined companies currently hold a 9-10% market share in Gujarat, with a significant 60-70% concentrated in the key Saurashtra region.
“At present, both companies combined capture about 9-10% of the total market share in Gujarat. Approximately 60-70% of this is in the Saurashtra business, which is the primary market for both Shree Digvijay Cement and Highbond Cement.”
— Vikas Kumar, Chief Financial Officer
The cement market is growing at 6-7% annually, primarily propelled by government investments in the infrastructure sector.
“The cement market is expanding by 6-7% year-on-year, driven by the government’s focus on the infrastructure sector.”
— Vikas Kumar, Chief Financial Officer
The company is actively negotiating with third parties, including Reliance, to potentially handle 1-1.5 million tons of commercial cargo at its jetty.
“We are under discussion with third-party administrators (TPAs) as well as Reliance, as there is an opportunity to handle commercial cargo. In the past, we handled one or two shipments. We are still in discussions regarding larger volumes of about 1 to 1.5 million tons.”
— Vikas Kumar, Chief Financial Officer
The combined entity currently achieves 2.4 million tons in sales volume and targets an aggressive growth rate of 150-200% of the projected 7-8% industry growth, driven by upcoming infrastructure projects.
“At present, we are capturing about 2.4 million tons of sales volume from both companies combined. We expect to grow faster than the industry. With infrastructure projects in the pipeline, we expect the market to grow by 7-8%, and we aim to grow at 150-200% of the market rate.”
— Vikas Kumar, Chief Financial Officer
The company is the leading supplier of oil well cement services in India, providing 90% of ONGC’s volume for over 30 years and also supplying other major players.
“Yes, we have been supplying to ONGC for more than 30 years. At present, we have about 90% of their total volume, as well as other players like Oil India. We are the number one supplier in India for oil well cement services.”
— Vikas Kumar, Chief Financial Officer
The oil well cement division contributes 7-8% to total volume but a disproportionately higher 15% to the company’s total sales revenue.
“In terms of volume, it is about 7-8%. However, in terms of sales revenue, it contributes about 15% of our total revenue.”
— Vikas Kumar, Chief Financial Officer
Over the past three years, the company has acquired two new limestone mines totaling approximately 20 million tons of reserves and continues to seek further acquisitions.
“In the last 3 years, we have acquired two new mines with approximately 20 million tons of reserves. We are continuously exploring options to secure more limestone.”
— Vikas Kumar, Chief Financial Officer
The Highbond deal is expected to positively contribute to earnings, primarily due to Highbond’s low production costs supported by 80% captive power and new technology.
“Yes, definitely. The cost of production for Highbond is relatively low because they have captive power that fulfills 80% of their consumption. The plant also uses new technology, leading to lower power and fuel consumption. There will definitely be an earning contribution from Highbond.”
— Vikas Kumar, Chief Financial Officer
After two challenging years, the company anticipates an upward price trend and improved demand and pricing in Q1 FY27, forecasting a strong performance for the full fiscal year 2027.
“The last 2 years were not easy for the industry, but prices started increasing in Q4. We expect the price trend to remain upward in Q1 FY27. Demand and pricing should both improve because current pricing is at a multi-year low. Cement is a cyclical business, and after two sluggish years, we expect FY27 to be good.”
— Vikas Kumar, Chief Financial Officer
Shree Cement Limited | Large Cap | Building Materials
Shree Cement Limited is a leading Indian cement manufacturer known for its cost-efficient operations and strong presence in Northern and Eastern India. The company is strategically shifting focus toward value-based pricing and expanding its Ready Mix Concrete segment to drive long-term growth.
[Concall]
Management has prioritized higher pricing over high sales volumes to bridge the price gap with the industry leader. This strategy is intended to improve long-term profitability even if it causes a temporary dip in market share.
“since October ‘24, I had been maintaining that we will be concentrating on value over volumes. That was with a purpose... we have narrowed the gap [with competitors] from about INR30 a bag to about INR15 a bag.”
— Ashok Bhandari, Senior Advisor
The company is focusing on the Ready Mix Concrete (RMC) business to improve plant usage and lower transport costs. This move helps the company reach customers more effectively while supporting its core cement sales.
“the capacity utilization will further be augmented by concentrating more and more on RMC plants, which shall give me a better geographical reach, a more logistical cost optimization and increase the volumes as well.”
— Ashok Bhandari, Senior Advisor
The company maintains the lowest fuel procurement costs in the industry while sourcing 61% of its power from renewable energy. These efficiencies protect profit margins from fluctuations in global energy prices.
“per kilocalorie cost is lowest in the industry sitting at 1.56. And my renewable energy has kept on increasing and it has reached almost 61%.”
— Ashok Bhandari, Senior Advisor
The company remains open to further expanding its presence in the UAE if market conditions become more attractive. Their existing scale in that region allows them to capitalize quickly on any local construction growth.
“We have the largest cement plant in UAE today in our control... If there is potential, if there is real demand perk up, if the operations are profitable or good enough profitable, we will certainly do whatever is required to be done.”
— Ashok Bhandari, Senior Advisor
Engineering & Capital Goods
KSB Limited | Small Cap | Engineering & Capital Goods
KSB Limited, founded in 1960 and headquartered in Pune, Maharashtra, is a leading manufacturer of pumps and industrial valves globally. With technical expertise in various types of pumps and valves, the company specializes in a wide range of products including Centrifugal End Suction Pumps, High Pressure Multistage Pumps, industrial valves, and more. KSB has invested in state-of-the-art facilities and technologies to cater to the demands of centrifugal pumps and industrial valves in India.
[Concall]
KSB anticipates thermal power plants and continued nuclear projects to be significant domestic growth drivers for the current year, alongside water/wastewater and commercial building services.
“First of all, the growth drivers for this year in the domestic, yes, energy as we presented Power segment, especially the thermal power plants, which are coming up of different users, NTPC as well as Adani as many other projects, JSW. So, energy projects in the thermal power plants is a big growth driver for this year. Apart from nuclear also, nuclear will continue...”
— Rajeev Jain, Managing Director
The ongoing geopolitical situation is beginning to impact KSB’s supply chain, particularly for castings from gas-fired foundries, which could lead to future issues if prolonged.
“Coming to the present geopolitical situation and the supply chain. Yeah, I wouldn’t say that we are not affected that that impacts has started coming a bit in the supply chain, especially in the foundries where there is restriction of the LPG and the gas supply, our furnaces are gas fired.”
— Rajeev Jain, Managing Director
KSB’s exports to the Middle East face potential temporary disruption due to geopolitical shipping challenges, though the company is actively seeking alternative routes.
“The other is of course our supplies, our exports to Middle East region. That is also we are trying to mitigate and try to find another way. But that is also under review and discussion. So, our exports to Middle East may get hampered temporarily because of shipments.”
— Rajeev Jain, Managing Director
KSB’s solar business achieved exceptional order intake growth of 112% CAGR, supported by new in-house manufacturing of solar controllers to enhance competitiveness.
“So talking about solar business, 112% order intake CAGR. Some of the major highlights, we have started in-house manufacturing of solar controller making ourselves more competitive and technical leader.”
— Mahesh Bhave, Chief Financial Officer
KSB’s recent growth is primarily driven by new product introductions and entry into previously underserved segments like solar, water/wastewater, and firefighting, leveraging a low base effect.
“I would say a major part has come through the new products, be it solar, be it water, wastewater, firefighting. The percentage you see high, because I think the base has been very low. We have not been so actively involved in those businesses... This is definitely helping the growth.”
— Rajeev Jain, Managing Director
KSB can pass on increased costs for its 50% standard business and nuclear projects (due to PVC clauses), but domestic project business remains vulnerable to commodity price fluctuations.
“Yeah, of course, it is very natural that for our standard business, which is 50% of the business, we can pass on this increase. But the remaining 50% is project business. So except the nuclear business where there is a PVC clause, there we are safeguarded.”
— Rajeev Jain, Managing Director
KSB is closely monitoring potential spikes in commodity prices due to the geopolitical situation, which could pose an external risk to profitability.
“The only concern is the commodity prices, which I did not mention earlier. But with this market geopolitical situation, we would there is a chances of the spike in commodity prices. And this is something which we will have, we are watching very carefully and that may be the only, let’s say today’s external impact which may come, but we will have to act accordingly on that.”
— Rajeev Jain, Managing Director
KSB typically achieves better margins on exports compared to domestic sales, benefiting from higher international price levels and currency depreciation advantages.
“Yes. I would say it has to be from a related party transaction. It has to be and but, yes, the price levels are much better outside than in India, I would say, definitely. And plus, when you get a lot of when the currency depreciates, it gives us also an advantage to be competitive. So definitely, I would say margins are better compared to the domestic market.”
— Rajeev Jain, Managing Director
Rail Vikas Nigam Limited | Large Cap | Engineering & Capital Goods
Rail Vikas Nigam Limited is a leading Indian public sector undertaking specializing in the implementation of rail infrastructure projects across the country. The company is actively diversifying its portfolio into highways, metro rail systems, and international infrastructure projects to drive future growth.
[Concall]
The company is on track to deliver the first Vande Bharat prototype train set by June or July of the current year.
“First prototype which is required as per the key dates will be met and will be ready with the first prototype in June or July of this year.”
— Saleem Ahmad, Chairman and Managing Director
RVNL is uncertain about direct participation in new high-speed rail corridors due to existing project assignments to other entities but plans to bid for related works.
“And about the new corridors, which have been recently announced for the high-speed train network, so we are not sure whether we can be part of that work because that work is entrusted to another organization. But definitely, we will try to take some work from the bidding point of view.”
— Saleem Ahmad, Chairman and Managing Director
RVNL projects a revenue split of 50% from railway nomination works and 50% from diversified bidding projects (Vande Bharat, BharatNet, highways, other railways) over the next three years.
“for the next 3 years, our 50% of revenue will be from the railway works, which is 40,000; and 50% of our revenue will be from our bidding works, whether from Vande Bharat or from BharatNet, from highways and other railway sector.”
— Saleem Ahmad, Chairman and Managing Director
RVNL’s order book is diversified, with railways forming 45%, roads 10%, and the electrical sector (RDSS, transmission, railway electrification) 15%.
“Railway orders comprises of around 45% of our total orders. Then road sector, we have got around 10% of our total orders. Electrical sector, where we have got a diverse mix of orders from basically RDSS, which are basically revamped distribution support system in 4 states and transmission line and railway electrification works, they comprise of around 15%.”
— Chandan Verma, Chief Financial Officer
Signalling and telecom, including BharatNet, accounts for 15% of the order book, mechanical sector (Vande Bharat) 7%, and international projects contribute INR3,500 crores.
“And signalling and telecom work, which includes railway telecom works, signalling works as well as the BharatNet projects, they comprise of around 15% of our order book. And around 7% order book is from our mechanical sector, which includes our share in Vande Bharat and some of the workshop projects. And besides that, we have got an order book of around INR3,500 crores from international projects.”
— Chandan Verma, Chief Financial Officer
Suzlon Energy Limited | Large Cap | Engineering & Capital Goods
Suzlon Energy is a leading Indian renewable energy solutions provider specializing in the manufacturing and maintenance of wind turbine generators. The company operates a vertically integrated business model that spans the entire wind energy value chain, including forging and foundry services.
[Concall]
The Indian wind industry is on a clear trajectory to exceed 10 GW in the next two years and reach 100 GW by 2030, supported by existing installations and a robust pipeline.
“Industry is well positioned to move to higher installation year - after - year with a clear trajectory to surpass 10 gigawatt over the next 2 years. With 54 gigawatt already installed and a strong pipeline with STU and PSU bids as well as C&I demand, India is set to achieve the near - term target of 100 gigawatt by 2030.”
— Rahul Jain, Group Chief Financial Officer
The company is positioning itself to capture a significant share of the global wind turbine market as India becomes a manufacturing hub. Investors should look for increased export revenues as the company leverages its domestic cost advantages globally.
“India is emerging as a credible supplier for nearly 10% of global wind demand. Suzlon is also focusing for strong export-driven volume growth powered by competitive Make in India manufacturing base and our long-standing global operating experience.”
— Rahul Jain, Group Chief Financial Officer
The company is creating a dedicated development vertical to identify and secure wind sites years in advance. This proactive approach aims to solve land acquisition issues early and secure long-term contracts with major corporate clients.
“This business unit would concentrate on two things. So because the first thing it identifies which are the potential sites over the next 5 years based on the wind data what we have... And we start acting on that. And that is where we will have more strategic sales with the large customers.”
— J.P. Chalasani, Group Chief Executive Officer
There is substantial demand for wind energy from private commercial and industrial customers outside of the government auction process. This diversified pipeline reduces the company’s reliance on competitive state-run bidding cycles.
“The order pipeline is strong... as we speak today, we are now clearly talking about three to four gigawatts non bidding route of discussions are happening.”
— J.P. Chalasani, Group Chief Executive Officer
Execution remains a challenge for Suzlon and the sector, primarily due to limited control over land and Balance of Plant (BOP) in the 80% of projects that are non-EPC.
“Execution obviously remains a challenge for us as well as sector, in fact maybe for us more because of the numbers because others numbers we don’t know fully... The reason why the execution is getting delayed is the first of all th is is until now it is 80 - 20. 20 is EPC and 80 is non - EPC. So we have a limited control on land and BOP in those projects. So that’s one reason.”
— J.P. Chalasani, Group Chief Executive Officer
The Indian government has established a specialized task force to address the regulatory and land issues hampering wind power projects. If successful, this intervention could significantly speed up project commissioning timelines for the entire sector.
“They formally announced a task force by MNRE... basically to resolve issues with respect to land and ROW and the connectivity. So, therefore, it is now picking up the importance of it.”
— J.P. Chalasani, Group Chief Executive Officer
The company is using digital tools and AI to improve the performance and maintenance of its installed turbine fleet. Higher machine availability improves customer satisfaction and protects the high-margin service revenue stream.
“My entire OMS system is going to get digitized. So therefore the our predictive maintenance, preventive maintenance and everything can be tracked... it actually improves our up-time because of this data.”
— J.P. Chalasani, Group Chief Executive Officer
While Suzlon’s 5 MW turbine is in prototype, the company is successfully selling 3.15 MW units and has introduced a 3.3 MW turbine offering a lower cost per kilowatt-hour.
“Our 5 megawatt turbine is now getting into the proto stage and that will come at appropriate time. But the thing let me tell you is that the in spite of the fact there is a 5 megawatt turbine launched, our 3.15 megawatt is going significantly. And now we have also introduced started selling 3.3 megawatt with the revised power curve which has a lower cost per kilowatt hour compared to 3.15.”
— J.P. Chalasani, Group Chief Executive Officer
Auto
CEAT Limited | Small Cap | Auto Ancillary
CEAT Limited, a leading tyre brand in India and part of RPG GROUP, specializes in manufacturing automotive tyres, tubes, and flaps. With a focus on innovation, the company offers durable products that ensure safety with a secure grip on the road. CEAT is expanding its distribution, introducing new products, and strengthening its brand presence across social media platforms.
Capex remains disciplined and aligned with cash flows, with ~₹1,000 crore planned for the current year while maintaining leverage ratios.
“We manage capex year to year based on cash flows. We cannot abandon capex completely because that will compromise growth in the future. For the current year, capex will be around ₹1,000 crore, and we will stay within our guidance so that leverage ratios are maintained.”
— Arnab Banerjee, Chief Executive Officer
Capacity utilization is running high at 80–90%, with ongoing capex expected to support growth into FY28–29.
“Capacity utilization is 80% plus, and in some cases it goes up to 85–90%. The capex we are about to incur will give us the required capacity in FY28 and FY29.”
— Arnab Banerjee, Chief Executive Officer
Q4 remains largely unaffected by geopolitical tensions, but Q1 will see impact across freight, currency, and raw materials.
“Quarter four is almost done, and most raw materials were bought prior to the conflict, so we may not see much impact. Quarter one will have impact from higher freight rates, rupee depreciation, and escalation in crude-based derivatives.”
— Arnab Banerjee, Chief Executive Officer
Raw material costs are expected to rise sharply, with inflation of around 10%+ into May.
“The price escalation in raw materials could be around 10% plus going into May, which is a significant escalation.”
— Arnab Banerjee, Chief Executive Officer
Supply disruptions and elevated prices are both key risks, even if the conflict ends.
“There will be availability issues as well as price escalation. Even if the war ends, supply chains will take time to normalize and prices will remain high for some time.”
— Arnab Banerjee, Chief Executive Officer
Impact of disruptions could extend into early Q2, with H1FY27 bearing the brunt.
“It could spill over into the early part of the second quarter, which means the first half of FY27 is going to bear the brunt.”
— Arnab Banerjee, Chief Executive Officer
Growth expectations are being tempered, with double-digit growth now seen as a reasonable outcome vs earlier 15–20% guidance.
“15–20% growth for FY27 looks ambitious in the current situation. If we manage double-digit growth, it will be a good outcome assuming the war stops.”
— Arnab Banerjee, Chief Executive Officer
Price hikes are being implemented in replacement, with lagged pass-through impacting margins.
“We have already announced about 3% price hikes in replacement, and there will be further hikes. There is always a lag effect, which impacts margins.”
— Arnab Banerjee, Chief Executive Officer
OEM pricing remains indexed to raw materials, with partial pass-through and quarterly adjustments.
“In OEM, pricing is indexed to raw materials and revised quarterly. By and large, the pass-through happens, though not 100%.”
— Arnab Banerjee, Chief Executive Officer
Demand remains structurally strong but could moderate if sentiment weakens due to price increases.
“Underlying demand was absolutely strong, but if sentiment changes, customers may defer purchases, leading to moderation in demand.”
— Arnab Banerjee, Chief Executive Officer
TVS Motor Company Limited | Large Cap | Auto
TVS Motor is a leading global manufacturer of two and three-wheelers with a significant presence in India and international markets. The company produces a diverse portfolio ranging from entry-level commuter bikes to premium motorcycles and electric vehicles.
[Concall]
TVS is expanding its reach into the high-end luxury motorcycle market through the Norton brand. Success in this premium segment can improve the overall brand perception and lead to much higher profit margins.
“The new Max and Atlas families position the TVS ecosystem firmly in the premium and high-emotion luxury motorcycle segment. It is going to create a special super-premium experience for affluent global customers.”
— K.N. Radhakrishnan, Director and Chief Executive Officer
The transition to electric vehicles is accelerating, particularly in the three-wheeler segment where nearly a third of sales are now electric. This shift demonstrates the company’s successful adaptation to new technology and changing market demands.
“While EV penetration is slightly lower now, it will improve. Overall, EV penetration in two-wheelers and three-wheelers will increase; three-wheelers have already reached 30-32% this quarter.”
— K.N. Radhakrishnan, Director and Chief Executive Officer
International sales are rebounding, driven by recovery in key African and Asian markets. Strong export performance helps the company diversify its revenue sources and reduce dependence on the Indian domestic market.
“Exports from India grew by 23%, and demand in Africa continue to grow sequentially. Sri Lanka coming back in a big way and Nepal continuing to do well.”
— K.N. Radhakrishnan, Director and Chief Executive Officer
Customer demand is shifting toward more expensive and feature-rich motorcycles rather than basic models. This trend of premiumization is beneficial for the company as higher-end products typically carry better profit margins.
“Premium and super-premium segments are also growing faster, as is the executive motorcycle category. The entry-level segment is not growing as much.”
— K.N. Radhakrishnan, Director and Chief Executive Officer
Supply chain issues that restricted electric vehicle production are now being resolved. Investors can expect higher EV delivery volumes in the coming months as the company catches up with demand.
“Regarding EVs, we had a setback due to magnet availability, but that is recovering. By next month, we should have full EV supplies in the market.”
— K.N. Radhakrishnan, Director and Chief Executive Officer
Uno Minda Limited | Large Cap | Auto Ancillary
Uno Minda is a leading global supplier of proprietary automotive solutions and systems to original equipment manufacturers. The company specializes in safety, lighting, and switching systems for both two-wheeler and four-wheeler vehicle segments.
[Concall]
Recent trade developments between India and the U.S. significantly reduce export costs for Indian manufacturers. This policy shift makes Indian auto components more competitive in the American market and supports long-term growth for exporters.
“The proposed reduction in reciprocal tariffs from 50% to 18% announced on 2nd February is a positive step for export-oriented manufacturing. Lower tariff barriers are expected to improve the competitiveness of Indian suppliers.”
— Sunil Bohra, Group Chief Financial Officer
The conclusion of the India-EU Free Trade Agreement is expected to eliminate tariffs on auto components exported to Europe. This provides a major structural advantage for Indian companies to integrate into global supply chains at a lower cost.
“With the new FTA framework, tariffs are expected to revert to 0%, restoring competitiveness for Indian exporters. Overall, while the agreement increases openness in certain vehicle categories, we believe the net outcome for Indian auto and auto component players will be positive.”
— Sunil Bohra, Group Chief Financial Officer
The company is gaining market share by winning contracts with manufacturers where they previously had a smaller presence. This diversification reduces reliance on any single customer and expands their total addressable market.
“The 2-wheeler switch business continued to strive to increase its domestic market share, supported by new order wins from OEMs where our historical share of business had been relatively lower.”
— Sunil Bohra, Group Chief Financial Officer
Vehicle manufacturers are rapidly switching from traditional bulbs to more expensive LED lighting systems. This transition allows Uno Minda to sell higher-value products for every vehicle produced, boosting revenue even if car sales volumes stay flat.
“A key structural lever driver remains the industry-wide transition towards LED-based lighting, coupled with rising consumer preference for advanced design-led and aesthetically differentiated lighting solutions. These trends have contributed to a meaningful increase in kit value per vehicle.”
— Sunil Bohra, Group Chief Financial Officer
The company is investing over 700 crore rupees to build a large new plant for manufacturing alloy wheels. This massive investment highlights management’s confidence in the long-term demand for premium vehicle parts.
“The Board has approved the setting up of greenfield 4-wheel alloy wheel manufacturing facility with a capacity of 1.8 million wheels per annum. The project entails fresh capital expenditure of INR 764 crores to be deployed in a phased manner over the next 3 years to 4 years.”
— Sunil Bohra, Group Chief Financial Officer
New safety regulations will soon require all electric vehicles to emit artificial sounds to protect pedestrians. Because the company has already developed this technology, they are ready to capture this entirely new mandatory market.
“The Ministry of Road Transport and Highways has notified mandatory implementation of acoustic vehicle alerting systems called as AVAS for electric vehicles. Uno Minda has been investing in AVAS technology development over the past several years and is now well positioned to capitalize on this regulatory shift.”
— Sunil Bohra, Group Chief Financial Officer
Management has found a way to make sensors without relying on expensive and hard-to-find rare earth magnets. This switch makes their supply chain more stable and protects profit margins from volatile raw material prices.
“As part of our supply chain resilience and localization efforts, we have successfully developed alternatives to rare earth magnets and have commenced supplies of sensors using some of locally sourced magnets to our customers.”
— Sunil Bohra, Group Chief Financial Officer
The company is proactively building capacity to replace imported car wheels with locally made versions. Investors should watch this as a sign of the company’s aggressive strategy to win business from foreign competitors.
“We are also targeting some of the players who might be currently importing the wheels into the country and the discussions have so far been encouraging and motivating. It was like whether you wait for all the customers to get business and then start construction or you take a call.”
— Sunil Bohra, Group Chief Financial Officer
Hyundai Motor India Limited | Large Cap | Auto
Hyundai Motor India Limited is the Indian subsidiary of the South Korean automotive giant and serves as the country’s second-largest passenger vehicle manufacturer. The company operates high-capacity production facilities in Chennai and Pune, catering to both domestic demand and international export markets.
[Concall]
Government policies in 2025, including income tax cuts, GST 2.0 reforms, and interest rate reductions, significantly boosted consumer demand and optimism in the Indian auto industry.
“Reflecting on calendar year 2025, the Indian automobile industry benefited from a series of supportive policy measures by the Indian government that strengthened consumer demand sentiments. 2025 started with the government announcing income tax cuts, which acted as a direct catalyst for discretionary consumption. Further, the implementation of GST 2.0 reforms brought greater clarity and stability to the indirect tax framework. This, coupled with interest rate cuts, significantly improved consumer buying sentiments and brought in a renewed wave of optimism.”
— Tarun Garg, Managing Director and Chief Executive Officer
The company is successfully expanding its footprint in rural India, which now accounts for nearly a quarter of its total domestic sales. This diversification reduces reliance on urban centers and taps into a resilient source of consumer demand.
“Rural markets continued to be a key growth driver for us. With sustained focus and targeted initiatives, we achieved our highest ever quarterly rural contribution to domestic sales, exceeding 24%.”
— Tarun Garg, Managing Director and CEO
The company is realizing higher revenue per vehicle through a combination of strategic price hikes and a shift toward premium models. Higher average selling prices contribute directly to protecting profit margins against inflationary pressures.
“Our blended ASP this quarter improved by 5% year-on-year, reflecting our strong sales mix and prudent pricing strategy. Notably, the improvement in ASP was seen both in domestic and exports with a growth of 4% and 8% respectively.”
— Tarun Garg, Managing Director and CEO
Alternate fuel options like CNG are becoming a significant part of the product mix as consumers look for cost-efficient mobility. Maintaining a diverse fuel portfolio allows the company to capture demand across different price points and geographic preferences.
“CNG continued to see strong traction, contributing 16% to domestic volumes, while diesel penetration was at 21% during the quarter.”
— K S Hariharan, Head of Investor Relations
New product launches like the Venue initially carry lower margins due to introductory pricing strategies. Profitability for these models is expected to trend upward as the company moves past the launch phase and increases component localization.
“At the same time, when a model is launched, it is typically launched at the lowest level of profit and then improves as we have headroom to increase prices and localization happens. This was the first quarter of the Venue launch and an introductory price was in place.”
— Tarun Garg, Managing Director and CEO
Increasing the percentage of locally sourced parts is a key pillar of the company’s strategy to reduce costs and mitigate supply chain risks. High localization levels improve competitive pricing and insulate the company from global currency fluctuations.
“Our localization level is already at 84% compared to 82% last year. We are continuously working on localizing high-technology parts. We feel we can manage the supply chain without hindrance.”
— Tarun Garg, Managing Director and CEO
The company’s product mix is shifting toward SUVs, which typically command higher margins and better consumer demand. The aggressive plan to launch 26 new models or facelifts ensures the portfolio remains fresh and competitive.
“Overall SUV contribution went from 54% to 56.2%. We are well on our way to meeting the numbers we promised at Investor Day across 26 models and facelifts.”
— Tarun Garg, Managing Director and CEO
Retail
Swiggy Limited | Large Cap | E-commerce & Food Delivery
Swiggy is a leading Indian consumer internet platform operating a hyperlocal marketplace for food delivery and quick commerce services. The company connects millions of consumers with restaurants and grocery stores through an extensive dark store and delivery partner network.
[Concall]
Increasing the volume of orders per store allows the company to use its existing infrastructure more efficiently. This scale also gives the company better bargaining power to earn more revenue from brand partnerships.
“The scale of operation, which effectively is measured in either Gross Order Value (GOV) per store or the number of orders per store, will have an impact on better utilization of our infrastructure... Regarding the movement for all the items that we sell, there is a bigger opportunity for monetization with the brands.”
— Amitesh Jha, CEO, Instamart
The company has significantly expanded its warehouse footprint to bring products closer to customers and lower transport costs. Investors should expect continued spending in this area to further streamline the delivery network.
“Over the last four quarters, we have more than doubled our warehousing capacity, which has been a key component of CAPEX. We expect a little more spending on CAPEX, especially on the warehousing space, to structurally improve our supply chain efficiencies.”
— Rahul Bothra, CFO
Swiggy is refusing to spend money on acquiring customers who only stay on the platform because of heavy discounts. This shift prioritizes long-term profitability over temporary, expensive increases in order volume.
“One thing we have taken as a very clear output is that we are not going to throw good money at bad growth. We are fully committed to that. We will never compromise good growth for margin, but we may compromise bad growth as it is not a sustainable advantage.”
— Amitesh Jha, CEO, Instamart
The MaxSaver initiative, which encourages users to build larger grocery baskets, is successfully improving profits per order. High customer retention for this program proves that users are willing to plan their purchases on the platform.
“We reiterate our commitment to MaxSaver because it increases profitability in terms of revenue per order... The retention of MaxSaver customers is actually similar to or higher than what we see for non-MaxSaver customers.”
— Amitesh Jha, CEO, Instamart
Long-term users are ordering more frequently, which provides a stable foundation for the business. Management is avoiding ultra-low-cost orders because they do not contribute to building a healthy, profitable platform.
“Our mature cohorts are growing faster, showing customers are becoming more sticky. We believe such interventions will always be required, and that is why we want flexibility in how we spend. However, vanity metrics based on 99-rupee orders are not conducive to how we are building our platform.”
— Amitesh Jha, CEO, Instamart
Sales of items like electronics and home goods now make up nearly a third of the quick commerce business. Management expects this mix to stabilize, focusing now on making these categories more profitable.
“We also believe non-grocery has now crossed 30%, and we do not see significant headroom for that to expand at the same pace. Monetization initiatives will mean the ratio starts converging on the higher side.”
— Management, Executive Team
The company aims to significantly increase the number of orders processed by each existing dark store. This strategy focuses on getting more out of their current locations rather than just building new ones.
“Getting a 25-30% increase in throughput per store is a near-term target. Our store strategy and network are well laid out for densification. We have the right consumer input in place without needing significantly more stores apart from densification.”
— Management, Executive Team
Currently, 30% of the company’s local delivery areas are profitable, and they need to reach 50% to break even as a whole. They are working to increase this by finding more ways to earn money from each order and location.
“More than half of our business in terms of polygons will have to be positive for break-even to happen. Today that number is closer to 30%. As we add monetization and improve the Contribution Margin journey, more stores and polygons will become positive.”
— Management, Executive Team
Varun Beverages Limited | Large Cap | FMCG
Varun Beverages is one of the largest franchisees of PepsiCo globally, manufacturing and distributing a wide range of carbonated and non-carbonated drinks. The company operates across India and several international markets including Sri Lanka, Nepal, Morocco, Zambia, Zimbabwe, and South Africa.
[Concall]
More than half of the company’s total beverage volume now consists of healthier, low-sugar or no-sugar options. This transition reduces regulatory risks and aligns the product portfolio with growing consumer demand for health-conscious drinks.
“In CY 2025, the mix of low sugar and no sugar products increased to the level of ~59% of consolidated volumes, reflecting our continuous focus on healthier beverage offerings.”
— Raj Gandhi, President and Whole-Time Director
The company expects its international snacks business to eventually generate 100 million dollars in revenue. Diversifying into snacks provides a significant new growth engine that complements its existing beverage distribution network.
“We think this is going to go close to a $100 million business, and this is not an unforeseen number that can happen with two of these three territories [snacks in Morocco, Zimbabwe and Zambia].”
— Ravi Jaipuria, Chairman
The company is expanding its successful Nimbooz brand into new traditional flavors like Jeera. Leveraging established brands for new product launches reduces marketing risks and taps into existing consumer loyalty.
“About March, we will be launching our Nimbooz Jeera range... Nimbooz which is growing very fast for us and is doing phenomenally well, we are planning to launch more flavors and price points in that.”
— Varun Jaipuria, Executive Vice Chairman and Whole-Time Director
The company is making its first move into the alcoholic beverage space through a partnership with Carlsberg in African markets. This entry expands the company’s total addressable market while utilizing its existing distribution expertise.
“We are starting with Carlsberg in Africa, the capital allocation will not be so large. We will be starting to set-up one plant this year.”
— Ravi Jaipuria, Chairman
The acquisition of Twizza in South Africa is expected to increase overall profit margins by saving on transportation costs. By producing closer to customers, the company can improve logistics efficiency and increase supply chain speed.
“Twizza... will be margin accretive for BevCo, capacity accretive and freight reducing because we will be nearer the market. Instead of 5, we will be reaching the market from 8 different locations.”
— Raj Gandhi, President and Whole-Time Director
Voltas Limited | Large Cap | Consumer Electronics
Voltas Limited is India’s leading air conditioning company and a major provider of electromechanical projects and engineering services. A part of the Tata Group, it operates across cooling products, home appliances through a joint venture, and large-scale infrastructure projects.
[Concall]
Sales growth was largely fueled by tax reductions and customers buying early to avoid expected price hikes from new energy efficiency rules. This indicates that current demand might be partly pulled forward from future quarters.
“Through this quarter, the company’s performance was anchored by the room air conditioning business, driven by healthier channel activity following the GST rate cut and buying ahead of the BEE star label transition.”
— Management, Executive Team
Management has prepared new product models and pricing to meet upcoming mandatory energy efficiency standards. Having production ready across multiple factories ensures they can meet the high demand expected during the summer.
“The company is fully ready and realigned for the new BEE efficiency table with refreshed lineups and calibrated pricing architecture in place and is geared to meet seasonal demand with aligned production plans across Pantnagar and the new Chennai factory.”
— Management, Executive Team
Management expects higher costs from raw materials and currency shifts but is being cautious about when to raise prices for consumers. This suggests there might be a temporary squeeze on profits before price hikes take effect.
“We will maintain a balanced approach regarding pricing. Will commodity and currency fluctuations have an impact? Definitely, yes. However, the exact quantum and timing of passing this on is a dynamic decision.”
— Management, Executive Team
Dealers currently hold about a month and a half of stock, which management expects to sell off as summer begins. Low inventory levels in the future would allow the company to sell more of its newer, higher-priced models.
“Regarding channel inventory, we believe there is approximately 5-6 weeks of inventory. It is just a matter of time. By mid-March, we expect that inventory to be cleared as the summer season picks up.”
— Management, Executive Team
New energy norms are making the production of high-end five-star air conditioners much more expensive. This cost pressure will likely force a significant price hike for premium products in the coming months.
“The table change impact is different for the three-star and five-star models. Three-star is lesser, but the five-star increase is significant. The overall number will be a summation of the table change, copper, and currency impacts.”
— Management, Executive Team
The company has until mid-year to sell off its existing inventory that follows older energy standards. Clearing this stock is a priority before they can fully transition to selling more profitable new-norm products.
“The rules allow brands and channel partners to sell old table products until the end of June. Like our competitors, we have stocks of old table products. Our focus is to liquidate the old table stock first.”
— Management, Executive Team
International
Saudi Aramco | Energy
Saudi Aramco, officially the Saudi Arabian Oil Company, is the world’s largest oil-producing company and a top-ranked global corporation by revenue, headquartered in Dhahran. It manages over 270 billion barrels of crude oil reserves and operates extensive upstream, downstream, and petrochemical businesses globally.
Aramco swiftly ramped up the East-West Pipeline to reroute exports, targeting full utilization within days.
“We ramped up production through the East-West Pipeline, which has a capacity up to 7 million barrels a day, most of it for export… We should be reaching capacity in a couple of days. It’s all building on the repositioning of tankers from the east to west.”
— Amin Nasser, President and Chief Executive Officer
Pipeline utilization is constrained by tanker availability, but flows are already more than double initial levels.
“We are on more than double what we started with… within a couple of days, we should be reaching the capacity on the East-West Pipeline, pending availability of vessels which are currently en route.”
— Amin Nasser, President and Chief Executive Officer
Global storage network across Asia and Europe is being actively leveraged to maintain export continuity.
“We monitor closely the storage facilities available in the Kingdom and out of the Kingdom. We have different storage facilities in Japan, in Korea, in the Netherlands, in Rotterdam… We are capitalizing on these to balance our exports and meet our customers’ requirements.”
— Amin Nasser, President and Chief Executive Officer
Aramco is coordinating with customers while remaining supportive of geopolitical measures to ensure supply flows.
“Majority of our exports are sold on freight-on-board basis… we are working very closely with our customers and partners to minimize the impact of disruption… Of course, we will support any actions or measures that will help to deliver our products to the global market.
— Amin Nasser, President and Chief Executive Officer
LNG strategy is scaling through partnerships, targeting meaningful volumes by 2030.
“We have positioned different projects with a cumulative potential offtake of up to 3.2 million tons by 2030… including the acquisition of stakes in LNG projects and a 20-year sales and purchase agreement with NextDecade for 1.2 million tons.”
— Amin Nasser, President and Chief Executive Officer
Capex discipline remains intact, with spending at the lower end of guidance driven by timing rather than project cuts.
“We did indeed come at the low end of the range… this is a demonstration of our capital discipline and flexibility. The low end is not because of impact on projects… we are on track to deliver our major investment program.”
— Amin Nasser, President and Chief Executive Officer
Production can be ramped back quickly due to operational flexibility and spare capacity.
“We can ramp up in days, not weeks… we have ample spare capacity… even wells that are shut down can be brought back in days to the market.”
— Amin Nasser, President and Chief Executive Officer
A prolonged Strait of Hormuz disruption could remove a significant portion of global supply.
“We’re talking about almost 20% of the global supply… 17–18 million barrels per day coming through the Strait of Hormuz… even with our ability to export through the western region, you’re talking about close to 350 million barrels of disruptions.”
— Amin Nasser, President and Chief Executive Officer
West Coast refineries remain fully operational and are critical for both domestic and export markets.
“We do have a significant number of refineries on the West Coast. These were not impacted whatsoever… they provide products for local and export markets.”
— Amin Nasser, President and Chief Executive Officer
Eastern refineries are being optimized for domestic supply due to export constraints via Hormuz.
“We are sizing the capacity of each refinery in the eastern part of the kingdom based on meeting kingdom demand… we cannot export at this stage through the Strait of Hormuz.”
— Amin Nasser, President and Chief Executive Officer
Infrastructure investments like the East-West Pipeline were built precisely for contingency scenarios.
“We built the East-West Pipeline with contingency in mind… it gives us another exit for our crude through the Red Sea.”
— Amin Nasser, President and Chief Executive Officer
Local supply chain strength (iktva) significantly enhances operational resilience.
“70% of what we use in terms of procurement comes from within the Kingdom… that enabled the establishment of 350 new local manufacturing facilities.”
— Amin Nasser, President and Chief Executive Officer
Aramco’s crisis readiness and contingency planning are unmatched globally.
“Our readiness in terms of equipment… and contingency planning is no match anywhere in the world… we have demonstrated this through various crises.”
— Amin Nasser, President and Chief Executive Officer
Global storage and inventory provide an additional buffer to maintain supply during disruptions.
“We have storage facilities in Asia, Japan, South Korea, Spain, and Europe… that gives us flexibility and inventory to ensure we continue supplying energy during this crisis.”
— Amin Nasser, President and Chief Executive Officer
Projects remain on schedule despite geopolitical disruptions, supported by strong domestic sourcing.
“Projects for our major programs continue as normal… over 70% of our supply chain is from inside the Kingdom… we are on schedule for completion.”
— Amin Nasser, President and Chief Executive Officer
Even with inventory support, prolonged disruptions would materially impact global energy markets.
“That inventory cannot last for an extended period… if this persists for a long term, it will have a significant ramification on the global economy.”
— Amin Nasser, President and Chief Executive Officer
Jafurah gas project remains on track, with significant scale-up planned through the decade.
“Jafurah Phase One will ramp up to 650 billion cubic feet… Phase Two will allow us to reach a sustainable rate of 2 billion cubic feet per day by 2030… we are drilling more wells every year to reach that capacity.”
— Amin Nasser, President and Chief Executive Officer
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.
We’re now on Reddit!
We love engaging with the perspectives of readers like you. So we asked ourselves - why not make a proper free-for-all forum where people can engage with us and each other? And what’s a better, nerdier place to do that than Reddit?
So, do join us on the subreddit, chat all things markets and finance, tell us what you like about our content and where we can improve! Here’s the link — alternatively, you can search r/marketsbyzerodha on Reddit.
See you there!
Have you checked out Points and Figures?
Points and Figures is our new way of cutting through the noise of corporate slideshows. Instead of drowning in 50-page investor decks, we pull out the charts and data points that actually matter—and explain what they really signal about a company’s growth, margins, risks, or future bets.
Think of it as a visual extension of The Chatter. While The Chatter tracks what management says on earnings calls, Points and Figures digs into what companies are showing investors—and soon, even what they quietly bury in annual reports.
We go through every major investor presentation so you don’t have to, surfacing the sharpest takeaways that reveal not just the story a company wants to tell, but the reality behind it.
You can check it out here.