Ashish Kacholia Picks Stake in Multibagger Green Hydrogen Stock

Editor's Note: The earnings season has kicked off in full swing, with focus shifting away from the macro headlines towards the corporate setting.

Some banks have been the standouts, with HDFC Bank providing a good update for the listing of its subsidiary, while Kotak Bank has disappointed investors.

The coming few days will be busier than usual on the earnings schedule, with big companies also releasing their quarterly results.

Along with results, companies will also file their shareholding for the quarter. And retail investors would take cues on how big institutional investors and Indian celebrities have modified their holdings in the company.

Ashish Kacholia is one such widely tracked celebrity in the Indian investing community.

He started his career with Prime Securities in 1993 and later in 2003, started Hungama Digital Entertainment Company along with Rakesh Jhunjhunwala. He is also the proprietor of Lucky Securities. He is often referred as the 'Big Whale' of the Indian stock market.

Yesterday, it was revealed that Kacholia has added over 1% stake in a smallcap stock that goes by the name Advait Infratech.

During the July-September 2024 quarter, Kacholia bought 288,185 shares of the company in a private placement on a preferential issue basis.

The shares were issued to Kacholia at Rs 1,388 per unit.

While this buying activity is just now being reported to the stock exchanges, we wrote to you about it back in July 2024 when Kacholia initially initiated the buying.

Continue reading.

Ashish Kacholia Picks Stake in Multibagger Green Hydrogen Stock

The allure of multibagger stocks is undeniable. These financial powerhouses, capable of multiplying investments manifold, have captured the imagination of investors worldwide.

The likes of Ashish Kacholia, Rakesh Jhunjhunwala, and Mukul Agrawal have attained legendary status for their uncanny ability to unearth these hidden gems. Their success stories inspire countless individuals to seek their fortune in the stock market.

However, the art of identifying potential multibaggers before they soar is a complex one, often perceived as a form of financial intuition.

Recognising this, many investors turn to studying the strategies of these investment maestros, hoping to glean insights that can propel their portfolios to new heights.

In this instance, ace investor Ashish Kacholia recently bought a stake in a multibagger green hydrogen stock that has already experienced impressive growth of 244% in 2024.

Which Stock Did Ashish Kacholia Buy Stake in and Why?

The stock in question is Advait Infratech.

Advait Infratech is a prominent Indian company specializing in power transmission, substation, and telecommunication infrastructure.

According to data available on exchanges, the Board of Directors (Board) of the company, at its meeting held on Thursday, 4 July 2024, approved the issuance of 288,185 shares to Ashish Kacholia by way of private placement on a preferential issue basis.

The shares, with a face value of Rs 10 each, were issued for cash at Rs 1,388 per equity share.

Before this, on 30 May, Ashish Kacholia had bought 288,185 shares or a 2.7% stake in Advait Infratech. This brings his total holding in the company to 5.3%.

While we?don't know why he added additional shares of Advait Infratech, there are some reasons that we can guess.

#1 Green Hydrogen Venture

On 4 July 2024, Advait Infratech formed a wholly-owned subsidiary, Advait Energy Holding AS, in Norway. This new subsidiary will engage in strategic collaboration and investments, services, marketing, manufacturing, and the exchange of technical know-how within the green hydrogen ecosystem.

In a stock exchange filing, Advait Infratech stated that it had submitted a 100% initial subscription to the share capital in cash through the ODI route.

Advait Infratech is notably one of the six firms that emerged as successful bidders for government incentives aimed at setting up facilities to manufacture electrolysers, which are critical components for green hydrogen production.

Advait Infratech plans to expand its electrolyzer manufacturing capacity to 200 MW per year by 2025.

The company ventured into green energy in 2023 by forming a special-purpose vehicle, Greenergy, focusing on electrolyser assembly and manufacturing for hydrogen production, fuel cell supply, and sustainable services like carbon consultancy.

Currently, its electrolyzer manufacturing plant in Kadi, Gujarat, has a capacity of 120 MW per year, producing 0.3/0.5/1 MW electrolysis cell stacks and 2/4/8 MW modules.

This venture into the booming renewable energy space could be one of the reasons why ace investor Ashish Kacholia decided to increase his stake in the company.

#2 Recent Order win

According to recent stock exchange filings by Advait Infratech Limited, the company has announced a significant achievement by its subsidiary, Advait Greenergy Private Limited.

The subsidiary has secured two substantial work orders amounting to a total of Rs 727.9 million (m) from a domestic client, KPI Green Energy Limited.

The first order pertains to the engineering, procurement, construction, and commissioning (EPCC) work for a 30MW solar project in Gujarat, valued at Rs 590 m. This project is to be completed within 9 months from the date of the order.

The second order involves the engineering, procurement, and construction (EPC) for a 1 MW green hydrogen plant at Matar, worth Rs 136.9 m, with a completion timeline of 8 months from the date of the order.

In FY24, Advait Infratech completed 149 orders, amounting to Rs 376 m.

This new order win represents a significant addition to their order book and showcases the company's growing capabilities and market presence.

The securing of these substantial orders could be one of the key reasons why ace investor Ashish Kacholia decided to increase his stake in Advait Infratech.

#3 Sound Financials

Another reason why Ashish Kacholia may have purchased shares in the company is its consistent business growth between 2022 and 2024.

The company's revenue has grown steadily over the past three years, with a CAGR of 62.7%. This indicates a strong and expanding business.

Rising power demand across India created a favourable market for Advait Infratech's transmission capacity.

Net profit has also increased over the period but at a greater pace than revenue of CAGR 102.8%. This is due to decrease in interest and admin expenses.

The net profit margin increased from 6.7% in FY22 to 10.3% in FY24, reflecting improved efficiency and cost management.

Financial Snapshot (2022-24)

(Rs m, Consolidated)	FY22	FY23	FY24
Total Revenue	799.5	1059.3	2117.2
Sales growth (%)		18.4	99.9
Net profit	53.2	81.2	218.8
Net profit margin (%)	6.7	7.8	10.3

Source: Equitymaster

What Next?

Advait Infratech has outlined ambitious plans to solidify its position as a leader in power transmission and a pioneer in the green energy sector.

The company aims to incorporate more renewable energy sources like wind and solar into its projects, emphasising sustainable practices.

Additionally, Advait Infratech plans to explore opportunities beyond its current regions to expand its market reach and tap into new growth avenues.

India's green hydrogen energy industry is aiming to achieve energy independence by 2047 and reach net zero emissions by 2070. To meet these ambitious targets, India is increasingly embracing green hydrogen energy.

The Indian government has unveiled a US$ 2 bn (Rs 160 bn) scheme to promote the production of green hydrogen fuel in the country.

With its new subsidiary in the green hydrogen space, Advait Infratech is well-positioned to contribute to and benefit from these developments.

This strategic move will further support the company's growth plans and reinforce its commitment to sustainability and innovation.

Update: Recently, Advait Infratech signed a Memorandums of Understanding (MoU) with the Government of Gujarat. These MoUs entail a proposed investment of Rs 450 million.

Apart from this, the company with KPI Green Energy inked a Memorandum of Understanding (MoU) with the government of Uttarakhand. This agreement will pave the way for the establishment of a 500 MW solar park under the captive power producer (CPP) segment.

Going forward, the company plans to bolster its position in the green hydrogen space by expanding its renewable energy capacity.

How Shares of Advait Infratech have Performed Recently

The Advait Infratech stock rose around 11% in the past month. Over a year, the share price has gained by 473%.

Advait Infratech share price touched its 52-week high price of Rs 2,052.1 on 15 July 2024. Its 52-week low was Rs 344 touched on 17 July 2023.

The company is currently trading at a PB (price to book value) multiple of 35.8 times.

About Advait Infratech

Advait Infratech is an India-based company, which is engaged in providing products and solutions for power transmission, substation, and telecommunication infrastructure.

It operates with various verticals such as turnkey telecommunication projects, installation of the power transmission, substation and telecom products, marketing, and providing end-to-end solutions to the customers.

The company manufactures and supplies capital stringing tools for the construction of transmission lines. It is involved in manufacturing optical fiber ground wire (OPGW), OFC cables, aluminium-clad steel wire, emergency restoration systems, and OPGW joint boxes.

It provides live-line and off-line installations of the OPGW system. Its service range includes survey, erection, jointing, and commissioning until end-to-end line testing.

The company also offers emergency restoration systems, porcelain and composite insulators, glass disc insulators, and earthing solutions stringing tools.

To know more about the company, check out Advait Infratech's fact sheet and quarterly results.

You can also compare Advait Infratech with its peers.

Advait Infratech vs KPT Industries

Advait Infratech vs TRF

Advait Infratech vs Disa India

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