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Day 1 of the Conference kicked off in a grand way, with participation by 44 companies. We saw 460 plus clients consuming over 1100 meetings through the day. Our carefully-chosen MainTracks covered the hotly-debated topics of green energy (Mr Sarma @Larsen), EMS (Mr Lall @Dixon) and NBFC renaissance (Mr Piramal @Piramal Group).

MainTrack Takeaways

Despite attendance by managements of disparate sectors, enthusiasm about future growth and India’s manufacturing resurgence was clearly evident. A pivot towards green energy is a given and will entail billions, as India strives towards a net-zero target by 2070. Mr. Sarma highlighted Larsen’s investments in electrolysers and that the renewable power value-chain will lower the cost curve and improve the pace of adoption. It is likely that regulatory intervention will increase the cost of competing substitutes, as climate change is an existential crisis. Atul Lall expects continued momentum in EMS, with a multi-step change in value addition or deepening in manufacturing. Dixon, meanwhile, is planning years in advance and tapping IPRs in research & design. Our conversation with Mr. Piramal was multidimensional: about how Indian scriptures have influenced his business decisions, to leadership hiring and his mantra around “buying imperfect and selling perfect” — a skill only an outstanding entrepreneur like himself can pull off.

Company Conversations — Connecting the dots

* We hosted 45 companies across multiple sectors in our conference today. A quick brief on business plan, outlook, competitive dynamics, input & output price inflation, etc is attached with the presentation herewith. A few relevant observations are tabled below.

* Monsoon progress and farm crop assessment remains bright. Auto companies like Mahindra & Mahindra are more bullish on rural demand, especially for tractors, while consumer companies like Marico are experiencing very initial green shoots.

* Most companies are witnessing input deflation — dairy and energy related. Cement companies are pushing for volumes over prices, and we are seeing very guarded increases from building-material companies. MDF oversupply will remain an overhang on price realisations

* Chemical companies continue to see substantial drag from slowdown in China and Europe, and the consequent inventory de-stocking. These could last for a few more quarters.

* China plus one strategy is most evident in the auto eco-system and EMS. Sansera’s order win as a Tier-I supplier to Tesla marks not only cost advantage, but also superior engineering prowess. Likewise, Dixon’s partnership with Xiaomi highlights the big reset in value-addition metrics and for global markets.

* NBFCs are perhaps outpacing banks in disbursement growth, while not taking any undue risk. M&M Financial Services is echoing its parent outlook on improvement in rural demand. Shriram Transport is forecasting far better unit economics for its truck drivers, given the substantial improvement in asset utilisation — a function of more miles driven per day and less idle days. AUM growth will be much faster hereon.

* MMT too forecast better demand for airline tickets, hotels, etc, as consumers seek more frequent leisure, and more so domestically on longer weekends. The Services sector is booming, per the robust PMI data.

* IT companies’ commentary is much similar to their most-recent earnings commentary: no change.

Tomorrow is another day

* We are hosting more than 70 companies tomorrow and are keen to host you again. Don’t miss Mr Bhargava @ICICI Lombard or the AI czar Mr Pushpak @IIT Mumbai in our MainTrack.

* We value your presence and look forward to another enriching day.

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