Foods & Inns (FIL) is a manufacturer and exporter of a range of processed tropical fruits pulps, purees and vegetables with state of the art factories in Mumbai, Chittor, Valsad, Sinnar and Gonde (Nasik). The company operates in the food processing industry. Its principal divisions are Aseptic, Canning, Spray drying, frozen fruits, IQF (Individually Quick Frozen) vegetables and snacks. Product range includes tropical fruit purees and concentrates of Mango, Guava, Papaya and recently commissioned lines for Tomato Paste, Flavor Compounds & Natural Fruit & Vegetable Powders. Margins to improve in FY20 During the year, the company’s EBITDA stood at Rs 26.0crore in FY18 vs. Rs 22.74 crore in FY17. For the same period, EBIDTA margins have improved by 136 bps from 6.42% to 7.78% due to decrease in raw material prices and improve supply chain and lower cost of production. We expect EBITDA margins to improve by ~250 bps to ~10-11% and PAT margins of ~3-4% in coming years. By-1) Installation of solar panel will have potential to save 15-20% electricity cost 2) Expansion planning of new and modern processing facilities to amplify synergies 3) Saving of raw material procuring cost due availability of cash 4) Making regular advancements in technology and acquiring or developing new technologies for its processing activities. Proceeds from Land Bank sale to unlock value Foods & Inns have sold a land bank of approx. two and a half acres in the Chembur which is in the heart of Mumbai city for ~ Rs 148 Cr. The company will further receive 15.46 Cr according to agreement with Puravankara Ltd. (we expect it to be received by Oct. 2019 due to Maharashtra Elections 2019). Also, we expect ~15 Cr to be received from the sale of TDR on DP road by Oct. 2019. The company already repaid Rs 104 Cr debt by using the proceeds from land sales. FIL now has Rs 65 Cr debt on its balance sheet. The management is keenly evaluating some organic or inorganic expansion proposals. This will help the company to enter into new products and new geographies to boost its revenue and margins. It also has plans to enter into the B2C segment. Valuation & Outlook The company has initiated cost savings wrt. –a) Installation of solar panel will have potential to save 15-12% electricity cost b) Sale of waste material resulting in revenue c) due to low cost of procurement of RM , will improve margins by 100 bps. Also company is looking for organic or inorganic expansion to add new products to its portfolio. We believe company’s focus on diversifying the product portfolio and optimization of capacity utilization during the idle season will have significant impact on the company’s performance over next 2-3 years. Given the fact that the company is planning to enter into B2C segment , we value the company by 14x FY20 EBITDA .We recommend BUY with TP of 281 (14x FY20E EBITDA)

Merger issues & asset quality concerns have been far behind for SBI. With reduction in credit cost combined with improvement in NPA’s, setting aside lower provisions for bad loans, SBI is expected to post good earnings show going ahead. The recent moderation in bond yields is expected to provide boost to treasury performance additionally.

Upholding dominance; Two strategic investments over ten days

Far away from the electric shock

On a firm footing in North America

Transformative capabilities allowing choice of higher value

Remaining dominant in Indian gaming space

JLR’s Feb’19 wholesales in line at 49.7k (est. 48.3k)

Asset monetization process on track