Jupiter Wagons Feb-25
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Questions and Answers

What was the approximate revenue from operations for Jupiter Wagons in Q3 FY25?

  • Rs. 1,100 crore
  • Rs. 950 crore
  • Rs. 875 crore
  • Rs. 1,029 crore (correct)
  • By approximately what percentage did Jupiter Wagons' EBITDA grow in Q3 FY25 compared to Q3 FY24?

  • 19.5% (correct)
  • 14.4%
  • 9.2%
  • 15%
  • What was the approximate EBITDA margin for Jupiter Wagons in Q3 FY25?

  • 15.2%
  • 13.9%
  • 14.4% (correct)
  • 12.8%
  • What can be inferred about Jupiter Tatravagonka Railwheel Factory (formerly Bonatrans India) after its acquisition?

    <p>Its revenue approximately doubled compared to the previous year. (B)</p> Signup and view all the answers

    Which of the following quantities of specialized containers did Jupiter Wagons supply to Indian Railways in the current nine months of FY25?

    <p>The quantity is not mentioned. (C)</p> Signup and view all the answers

    What is the expected timeline for the Joint Ventures (JVs) of Jupiter Wagons to start earning profit, and why?

    <p>From next year onwards, on account of sustainable localization of manufacturing processes. (C)</p> Signup and view all the answers

    Approximately how many axle boxes did Jupiter Wagons export in the current nine months of FY25?

    <p>Close to 10,000 (B)</p> Signup and view all the answers

    According to the discussion, which company currently stands as the primary competitor in the electric vehicle segment that Jupiter Wagons is entering?

    <p>Tata Motors (C)</p> Signup and view all the answers

    What is the current annual production capacity for electric vehicles at Jupiter Wagons' manufacturing plant?

    <p>10,000 vehicles (C)</p> Signup and view all the answers

    What is the primary reason Jupiter Wagons Limited approved the Rs. 3,000 crore QIP?

    <p>To prepare for potential growth opportunities arising from an expected substantial railway budget. (D)</p> Signup and view all the answers

    When is the commercial launch of the TEZ vehicle scheduled?

    <p>February 26, 2025 (A)</p> Signup and view all the answers

    What is the approximate value of Jupiter Wagons' current private order book for wagons?

    <p>Rs. 5,500 crore (C)</p> Signup and view all the answers

    What is the company's strategic goal regarding wagon revenue contribution by FY28?

    <p>Reduce wagon revenues to less than 50% of total revenues. (A)</p> Signup and view all the answers

    Looking ahead to the next financial year, what value of private order book does Jupiter Wagons expect to add?

    <p>More than Rs. 2,000 crore (A)</p> Signup and view all the answers

    What revenue target is the company aiming for by FY28?

    <p>Rs. 8,000-10,000 Cr. (B)</p> Signup and view all the answers

    What is Jupiter Wagons' strategy for revenue mix and growth?

    <p>Balanced revenue mix through innovation, operational excellence, and market leadership in both wagon and non-wagon segments. (A)</p> Signup and view all the answers

    Besides railways, in which other sector has Jupiter Wagons received initial orders for its lithium-ion battery systems?

    <p>BESS operations (A)</p> Signup and view all the answers

    For FY26, what topline revenue is Akash projecting for Jupiter Wagons?

    <p>Rs. 5,000 crore (D)</p> Signup and view all the answers

    Which specific business sector is expected to contribute significantly to the company's revenue growth in FY26, alongside wheel, container and brake businesses?

    <p>The auto business. (A)</p> Signup and view all the answers

    What factor makes it challenging for Jupiter Wagons to accurately project the value of upcoming tenders from Indian Railways?

    <p>Unpredictability of tender releases (B)</p> Signup and view all the answers

    What revenue is the company targeting for FY26?

    <p>Close to Rs. 5,000 crore. (B)</p> Signup and view all the answers

    How does Jupiter Wagons plan to leverage a potentially substantial railway budget?

    <p>By seeking growth opportunities and being ready to capitalize on them. (A)</p> Signup and view all the answers

    What information regarding the electric vehicle business is unclear until product deliveries commence?

    <p>Margin levels (B)</p> Signup and view all the answers

    What is the primary reason cited for the slow growth in Earnings Per Share (EPS)?

    <p>Very high equity base. (B)</p> Signup and view all the answers

    Prior to the discussion about the Rs. 3,000 crore QIP, Jupiter Wagons had completed another QIP. What was the approximate value of the earlier QIP?

    <p>Rs. 800 crore (B)</p> Signup and view all the answers

    Besides the Indian Railways, which sector contributes significantly to the order book of Jupiter Wagons?

    <p>Private sector (C)</p> Signup and view all the answers

    What is the significance of Jupiter Wagons already having order confirmations for over 500 TEZ vehicles before the commercial launch?

    <p>It suggests a strong initial market reception and demand for the TEZ vehicle. (B)</p> Signup and view all the answers

    Why does the management believe EPS will improve?

    <p>Once investments in key sectors mature and generate revenue. (D)</p> Signup and view all the answers

    How long does management estimate it will take for investments in the wheel sector to mature and begin yielding returns?

    <p>2 years to 2.5 years. (C)</p> Signup and view all the answers

    What aspect of its current financial status does Vivek Lohia emphasize to Darshil Pandya regarding Jupiter Wagons?

    <p>The company is very well funded on its existing business. (C)</p> Signup and view all the answers

    What level of EBITDA margins does the company anticipate maintaining as revenues increase to Rs. 8,000-10,000 crore?

    <p>EBITDA margins are expected to remain strong. (C)</p> Signup and view all the answers

    What is the primary reason Vivek Lohia mentions for seeking an enabling resolution for raising funds?

    <p>To prepare for potential future growth opportunities that may arise post tender. (B)</p> Signup and view all the answers

    According to Vivek Lohia, what funding mix is the company likely to consider for future growth opportunities?

    <p>A mix of both debt and equity to balance financial obligations and growth. (D)</p> Signup and view all the answers

    What revenue did Jupiter Wagons Limited project for the brake business for the current financial year?

    <p>Approximately 250 crore. (D)</p> Signup and view all the answers

    Why does Vivek Lohia decline to disclose the cost per kilometer for the 'battery as a service' initiative?

    <p>The information is proprietary and cannot be disclosed at this stage. (D)</p> Signup and view all the answers

    What potential risk to Jupiter Wagons' overseas market exposure is Jyothi Ranjan Pandey concerned about?

    <p>Global tariff policies. (B)</p> Signup and view all the answers

    If Jupiter Wagons has significant growth opportunities that require funding of $100 million, and they decide to use a 30/70 equity/debt mix, how much debt would they need to raise?

    <p>$70 million (C)</p> Signup and view all the answers

    Jupiter Wagons projects brake business revenue of approximately 250 crore for the financial year. If their actual revenue is 90% of the projected value, what would be the actual revenue?

    <p>225 crore (A)</p> Signup and view all the answers

    If global tariffs increase significantly, potentially impacting Jupiter Wagons' export revenue by 15%, what strategy might the company consider to mitigate this risk?

    <p>Diversify into new international markets with lower tariff barriers. (D)</p> Signup and view all the answers

    Vivek Lohia mentions awaiting announcements from the budget. Why is this information critical to the company's projections?

    <p>The budget announcements will clarify specific government initiatives that will drive the company's growth opportunities. (B)</p> Signup and view all the answers

    What is Vivek Lohia's response to the analyst's skepticism about achieving the projected revenue growth?

    <p>He acknowledges the difficulty in predicting precise figures without specific budget announcements but expresses confidence in doubling revenues. (D)</p> Signup and view all the answers

    According to the discussion, what is a key difference between order patterns from the Indian Railways and private sector in the wagon segment?

    <p>The private sector offers regular order books, while Indian Railways orders tend to be lumpy, with large orders placed less frequently. (D)</p> Signup and view all the answers

    What specific detail indicates the potential for a delay in meeting the anticipated demand for wagons?

    <p>The lumpy nature of orders from Indian Railways. (B)</p> Signup and view all the answers

    How does Vivek Lohia address the concern about the potential risks affecting the projected demand of 35,000 to 45,000 wagons per annum?

    <p>He acknowledges the risk associated with lumpy orders from Indian Railways but indicates that private sector orders are stable. (D)</p> Signup and view all the answers

    What strategy is implied for achieving the revenue target of doubling revenues in the next 3 years?

    <p>Aggressively pursuing new budget-related growth opportunities while maintaining a strong base in current orders. (A)</p> Signup and view all the answers

    What is the significance of Indian Railways releasing an order book for three years of execution?

    <p>It provides a predictable workload for the medium term, but doesn't negate the potential for longer-term order gaps. (C)</p> Signup and view all the answers

    Flashcards

    Q3 FY25

    The third quarter of the fiscal year 2025 for Jupiter Wagons.

    EBITDA

    Earnings before interest, taxes, depreciation, and amortization, indicating operational profitability.

    PAT

    Profit After Tax, which represents net profit for the company after all taxes.

    Revenue Growth

    Increase in revenue, indicating sales performance improvement.

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    Bonatrans India

    A company acquired by Jupiter Wagons, now called Jupiter Tatravagonka Railwheel Factory.

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    Brake Discs

    Components supplied to Indian Railways for braking systems.

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    Operational Excellence

    Achieving efficient operations with a focus on continuous improvement.

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    Joint Ventures (JVs)

    Collaborative agreements between companies to enhance business opportunities.

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    Enabling provision

    A resolution allowing future actions like raising funds if needed.

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    Growth opportunities

    Potential chances for business expansion or improvement.

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    Debt and equity mix

    Combination of borrowed money (debt) and ownership (equity) for funding.

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    Brake business revenue projection

    Estimated earnings of approximately 250 crore for the brake sector this year.

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    Battery as a service

    A business model offering battery usage instead of ownership.

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    Cost per kilometer

    The expense incurred for each kilometer traveled, often related to services like battery usage.

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    Global tariff risks

    Potential financial implications due to international trade taxes or tariffs imposed, particularly in exports.

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    Y-on-Y and Q-on-Q

    Year-on-year and quarter-on-quarter; measures business performance over time.

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    Commercial launch date

    The product will be commercially launched on 26th February 2025.

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    TEZ vehicles

    Over 500 TEZ vehicles have aimed order confirmations before the launch.

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    Lithium-ion battery systems

    Initial orders for lithium-ion battery systems have been received for railways and BESS.

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    QIP

    Qualified Institutional Placement refers to the method used for raising funds.

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    Rs. 3,000 crore QIP

    An approved QIP of Rs. 3,000 crore is an enabling resolution, not an immediate raise.

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    Railway budget

    The railway budget is expected to be substantial and growth-oriented.

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    Utilization of funds

    The previous QIP of Rs. 800 crore has led to the company's strong funding status.

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    Export Market

    Trade of goods to foreign markets, like North America and Europe.

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    Revenue Target FY28

    Aim to achieve revenues of 8,000-10,000 Crore by the fiscal year 2028.

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    Revenue Projection FY26

    Projecting revenues close to Rs. 5,000 crore for fiscal year 2026.

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    Operating Profit Margin

    Percentage indicating the efficiency of generating profit from sales.

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    EPS (Earnings Per Share)

    A measure of a company's profitability divided by the number of outstanding shares.

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    Investment in Wheel Business

    Company's commitment to investing in wheel-related operations for future growth.

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    EBITDA Margin

    Earnings before interest, tax, depreciation, and amortization, expressed as a percentage of revenue.

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    Growth Phase

    A period when a company is expanding its operations and revenues.

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    Tata electric vehicle

    The only electric vehicle currently available in the market.

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    Plant capacity

    The maximum number of vehicles a plant can produce annually.

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    Positive margins

    Profits expected from the electric vehicle business.

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    Wagon order book

    Total pending orders for wagons worth Rs. 5,500 crore.

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    Tender expectations

    Anticipated substantial tenders from Indian Railways for the next financial year.

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    Private order book

    Strong expected orders exceeding Rs. 2,000 crore from private entities.

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    FY26 topline

    Projected top revenue of Rs. 5,000 crore for FY26.

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    Electric mobility segment

    Sector focused on electric vehicles and related products.

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    Growth Trajectory

    The expected path of growth over a specific timeframe.

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    Current Outlook

    The present assessment or forecast of market or business conditions.

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    Revenue Doubling

    Target to increase revenues to twice the current amount within a set timeline.

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    Industry Challenges

    Obstacles and difficulties faced by a sector that can hinder growth.

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    Order Books

    A record of orders received and scheduled for production or fulfillment.

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    Private Side Orders

    Regular and consistent orders coming from private sector clients.

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    Lumpy Orders

    Infrequent or irregular orders that come in large volumes when they do arrive.

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    Key Risks in Demand

    Potential obstacles that could prevent anticipated levels of order demand from being met.

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    Study Notes

    Jupiter Wagons Limited Q3 and 9M FY25 Earnings Conference Call

    • Date: January 30, 2025
    • Management: Vivek Lohia (Managing Director), Sanjiv Keshri (CFO)
    • Q3 FY25 Revenue: Rs. 1,029 crore (15% YoY increase)
    • Q3 FY25 EBITDA: Rs. 148 crore (19.5% YoY increase), 14.4% margin
    • Q3 FY25 PAT: Rs. 97 crore (18.4% YoY increase), 9.2% margin
    • Q3 FY25 EPS: Rs. 2.29 per share
    • Order Book (Dec 31, 2024): Rs. 6,320 crore
    • Jupiter Tatravagonka Acquisition: Successful commercialization, expected revenue doubling in FY25 and further doubling in FY26.
    • Electric Mobility (JEM): Acquired Log9 Technology, 75% stake in subsidiary Jupiter Electric Mobility. Introduced Battery-as-a-Service. Launching new vehicles by Feb. 2025, with >500 order confirmations
    • Wheel Business: Rs. 225 crore turnover achieved, significant improvement from prior year. Projected Rs. 300+ crore FY25 turnover.
    • Railway Business: Strong order book. Current projections for substantial railway orders in FY26.
    • QIP: Rs. 3,000 crore QIP is an enabling resolution, not an immediate fundraise.
    • Target Revenue (FY26): Rs. 5,000 crore
    • Overall Outlook: Growth expected in wheel, container, brake, and electric mobility segments. Long-term vision to reduce wagon segment's contribution to overall revenue.
    • Challenges: Lumpy nature of railway orders.
    • Expected Order Cycle: 4-6 months

    Investor Questions & Answers

    • Specific questions on order books, margins, and profitability for the forthcoming financial year were discussed.
    • Investor inquiries included the company's strategy to increase profits considering increasing competition and increasing investment in non-wagon segments (such as wheels, containers).
    • Investor inquiries focused on the impact of the global economy on sales.
    • Major concerns for investors were potential risks and delays in securing large orders, especially from Indian Railways.
    • A consistent theme was the company's vision to reduce wagons, to less than 50% of the revenue share in the long term.

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    Description

    Highlights from Jupiter Wagons Limited's Q3 FY25 earnings call. Key points include a 15% YoY revenue increase, strong EBITDA and PAT growth, and a robust order book. The acquisition of Jupiter Tatravagonka is showing promise, and the electric mobility sector is expanding with new vehicle launches.

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