LAVA International Limited Unlisted Shares

(i) Lava International Limited is an Indian multi-national company in the Mobile Handset industry. The company was founded in 2009 as an offshoot of a telecommunication venture by Hari Om Rai, Sunil Bhalla, Shailendra Nath Rai, and Vishal Sehgal. It is headquartered in Noida, India, and has overseas operations in Thailand, Nepal, Bangladesh, Sri-Lanka, Indonesia, Mexico, and the Middle East. The company started its Africa operations by launching its product in Egypt in 2016.

(ii) The company has been building mobile handset design capability including industrial design, mechanical design, hardware design & software design.

(iii) It has demonstrated quick and robust expansion since inception, showing profitability and growing sales since the first year of operations. Lava and Xolo are two brands that operate under the parent company. With ‘Create Possibilities’ as its guiding principle, Lava has embarked on an ambitious journey of becoming the 1st global consumer brand from India by empowering every human with quality innovative products.

(iv) LAVA has a wide product portfolio that encompasses tablets, feature phones, and smartphones having various models in bar and touch form factors at multiple price points to suit all categories of consumers. The handset-maker a couple of years ago had 50 products (about 20 smartphones and some 35 feature phones) in its portfolio which has now brought down to less than 15 phones (five smartphones and nine feature phones).

(v) Lava has two manufacturing plants in India and the company claims to be the only Indian brand to design devices in India and do PCB SMT in its own factory.

The Company has an in-house research and development center and manufacturing facilities in Noida.

LAVA International Limited Unlisted Shares Details:

Total Available Shares:	1000
Face Value:	₹ 10 Per Equity Share
ISIN:	INE745X01014
Lot Size:	100 Shares
Current Unlisted Share Price:	₹ Best in Industry Per Equity Share

Promoters And Management:

1. Shailendra Rai -Wholetime Director

2. Sunil Bhalla- Director

3. Hariom Rai – Managing Director

4. Vinod Rai- Director

Financials of LAVA International Limited Unlisted Shares:

Balance Sheet

Particulars(in Crores)	Mar-16	Mar-17	Mar-18	Mar-19	Mar-20
Sources of Funds
Share Capital	31.217	31.217	129.866	129.866	129.866
Reserves	703	851	1,015	1,125	1,278
Long- Term Debt	36	33	79	67	55
Short-Term Debt	128	105	280	80	109
Trade payable	1,168	884	1,493	726	555
other liability	399	288	258	252	257
Total Liabilities	2,465	2,192	3,254	2,381	2,384
Application of Funds
Fixed Assets	49	124	91	97	79
CWIP	4	4	16	0	2
Investments	1	70	50	15	8
Trade receivables	670	513	1089	1014	1,314
Inventories	849	686	731	424	234
Other Assets	892	796	1277	831	747
Total Assets	2465	2192	3254	2381	2,384

Profit & Loss

Particulars(in Crores)	Mar-16	Mar-17	Mar-18	Mar-19	Mar-20
Revenue	7,272	5,940	4,810	5,108	5264
COGS	3,308	3,134	2,672	3,353	1130
Stock in Trade	2,456	1,232	976	863	3204
Employee Cost	291	423	460	323	199
Other Expense	786	872	547	407	548
EBITDA	430	279	155	163	183
OPM	5.92%	4.70%	3.23%	3.19%	3.48%
Other Income	23	39	22	3	5
Interest Cost	41	48	15	42	25
Depreciation	34	41	75	41	33
Profit before tax	376	229	88.3	81.5	130
Tax	110.9	70.1	33.1	8	18
Net Profit	267	159	55	73	107
NPM	3.68%	2.68%	1.13%	1.43%	2.03%
Shares	3.12	3.12	12.98	12.98	12.98
EPS in Rs	85.66	50.93	4.2	5.63	8.24

Valuation of LAVA

Lava total shares outstanding are 12.48 Crores
Current share value = 75
Valuation = 6400 Crores.
Revenue (FY19-20) = 5200 Crores.
Mcap/revenue = 1.2 (<2 is Under-Valued)

Company Address:

C-7/227, Second Floor Sector-7, Rohini Delhi DELHI, INDIA – 110085

Lava Share Price & Pre-IPO/Unlisted shares – Company Overview

Lava International Limited was founded on 27 march, 2009 and registered as the registrar of companies in Delhi. The company is engaged in trading and manufacturing mobile phones, storage devices, and other wireless telecommunication devices. The Company is a public limited company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India.

The company is a leading Mobile Handset Company in India and has expanded its operations to multiple countries across the world. Lava products are available through a nationwide retail network of 1.65 Lakh retailers who in turn are directly served by over 1000 distributors. Lava’s after-sales service network is one of the largest in the country with close to 800+ professionally managed service centers focused on speed and quality of service.

Lava share is available in the unlisted stock market in India. The lava share price is unstable,it keeps changing regularly.

Lava Share Price, Share Details as of March 31, 2022

Lava International Outstanding Shares:	575,465,778
Face Value of Lava International Unlisted Share:	Rs. 5 Per Equity Share
ISIN of Lava International Unlisted Share:	INE745X01022
Lot Size of Lava International Unlisted Share:	200 Shares
Lava International Share Price:	Best in Industry
PAN Number of Lava International:	AABCL5987H

Incorporation Details of Lava

Lava International CIN Number	U32201DL2009PLC188920
		Lava International Registration Date	27-Mar-09
Category / Sub-Category of Lava International	Limited by Shares/Non-govt company
		Lava International Registered Office Address	C-7/227, Sector – 7, Rohini, New Delhi – 110085
Lava International Registrar & Transfer Agent Address and Contact Details	A – 56, Sector – 64, Noida, Uttar Pradesh – 201301

Principal Business Activities of Lava

Name and Description of main products/services	NIC Code of the product/service	% to the total turnover of the Company
Mobile phones, Tablet & Communication Equipment	46524	100%

Board of Directors of Lava

Mr. Hari Om Rai, Chairman, and Managing Director

Mr. Shailendra Nath Rai, Whole Time Director

Mr. Sunil Bhalla, Director

Mr. Vishal Sehgal, Director

Mr. Vinod Rai, Independent Director

Mr. Rahul Kansal, Independent Director

Ms. Chitra Gouri Lal, Independent Director

Mr. Vinod Shrama, Independent Director

Particulars of Subsidiary and Associate Companies of Lava

XOLO – Subsidiary

China Bird Centro America S.A – Subsidiary

Shareholding Pattern of Lava (As of 31-03-2021)

S. No.	Shareholders’ Name	Number of shares	% of total Shares of the company
1.	Promoter Group	35,31,95,428	65.27%
2.	Public Shareholding	18,79,30,788	34.73%
	Total	12,48,66,902	100.00%

Lava Industry Outlook

It is a market leader in several countries being 4th largest in India, 2nd largest in Thailand, 3rd largest in Sri Lanka, and 5th largest in Bangladesh. It is currently in the works to expand its presence in the continent of Africa. The company has been building mobile handset design capabilities including industrial design, mechanical design, hardware design & software design.

It has demonstrated quick and robust expansion since inception, showing profitability and growing sales since the first year of operations. Lava and Xolo are two brands that operate under the parent company. With ‘Create Possibilities’ as its guiding principle, Lava has embarked on an ambitious journey of becoming the 1st global consumer brand from India by empowering every human with quality innovative products.

LAVA has a wide product portfolio that encompasses tablets, feature phones, and smartphones having various models in bar and touch form factors at multiple price points to suit all categories of consumers. The handset-maker a couple of years ago had 50 products (about 20 smartphones and some 35 feature phones) in its portfolio which has now brought down to less than 15 phones (five smartphones and nine feature phones).

Lava has two manufacturing plants in India and the company claims to be the only Indian brand to design devices in India and do PCB SMT in its own factory. The Company has an in-house research and development center and manufacturing facilities in Noida.

Lava International Limited Balance Sheet (Rs in Million)

Particulars	31-03-2023	31-03-2022
Assets
Non-current assets
Property, plant and equipment	578.91	1619.64
Capital work-in-progress	191.99	568.69
Intangible assets	2108.47	2220.05
Goodwill	451.51	426.90
Right of use asset	116.89	130.14
Investments accounted for using the equity method	60.87	61.09
Investments	987.31	695.15
Other financial assets	130.93	87.23
Deferred tax assets	310.23	315.49
Other non-current assets	237.03	117.37
Current assets
Inventories	7361.2	6828.77
Investments	28.73	–
Trade receivables	7381.88	12921.16
Cash and cash equivalents	963.59	930.69
Other bank balances	914.95	1084.36
Other financial assets	209.68	1266.45
Other current assets	3226.74	4660.42
Total assets	25260.91	33933.62
Equity and liabilities
Equity
Equity share capital	2705.63	2705.63
Instruments entirely equity in nature	33.42	33.42
Securities premium reserve	5690.34	5690.34
Treasury shares	-63.34	-63.34
Foreign currency translation reserve	898.58	696.71
Share based payment reserve	372.14	355.41
Retained earnings	4411.64	13474.16
Other reserve	17.31	17.31
Equity attributable to equity holders of the holding company	14065.71	22906.64
Non-controlling interest	-22.83	-22.13
Total equity	14042.88	22884.51
Liabilities
Non-current liabilities
Borrowings	229.82	524.79
Lease liabilities	109.47	132.44
Provisions	59.34	56.51
Current liabilities
Borrowings	2828.58	2699.37
Lease liabilities	38.4	30.16
Total outstanding dues of micro enterprises and small	132.17	241.9
Total outstanding dues of creditors other than micro enterprises	5730.74	4915.71
Other financial liabilities	1512.84	1392.8
Other current liabilities	332.02	642.71
Provisions	133.78	147.35
Current tax liabilities	110.87	265.37
Total equity and liabilities	25260.91	33933.62

Lava International Limited Profit & Loss Statement (Rs in Million)

Particulars	31-03-2023	31-03-2022
Income
Revenue from operations	54435.99	58776.45
Other income	273.87	203.68
Total income	54709.86	58980.13
Expenses
Cost of raw material and components consumed	16913.71	11473.79
Purchase of traded goods	28807.15	38700.71
Changes in inventories of finished goods, spares and stock in trade	-490.99	-1037.89
Employee benefit expenses	2106.34	2122.74
Other expenses	4446.51	4280.4
Total expense	51782.72	55539.75
Earnings before share of loss	2927.14	3440.38
Depreciation and amortization expense	1400.54	967.14
Finance costs	538.32	441.17
Profit before share of loss of an associate & joint venture and tax	988.28	2032.07
Share of loss of joint venture, associates	0.22	0.96
Profit before tax	988.06	2031.11
Current tax	119.6	265.13
Tax charge	-16.98	-16.21
Deferred tax	5.69	-86.47
Income tax expense	108.31	162.45
Profit for the year	879.75	1868.66
Other comprehensive income
Re-measurement gains/ losses of defined benefit plan	-1.71	0.07
Income tax relating to this item	-0.43	-0.02
Exchange difference on translation of foreign operations	-204.87	-261.46
Other comprehensive income/ loss for the year	-207.01	-261.46
Total comprehensive income for the year	1086.77	2130.12
Profit for the year is attributable to
Equity holders of holding company	880.44	1869.19
Non-controlling interest	-0.7	-0.53
Other comprehensive income of the year is attributable to
Equity holders of holding company	207.01	261.46
Non-controlling interest
Total comprehensive income for the year is attributable to
Equity holders of holding company	1087.45	2130.64
Non-controlling interest	-0.7	-0.53
Earnings per equity share
Basic	1.63	3.54
Diluted	1.5	3.25

Lava International Limited Cash flow statement (Rs in Million)

Particulars	31-03-2023	31-03-2022
Cash flow from operating activities
Profit before tax	988.06	2031.11
Adjustment to reconcile profit before tax to net cash flows
Depreciation	1400.54	967.14
Profit/ loss on sale of property, plant and equipment	-1.95	0.08
Unrealized foreign exchange gain/ loss	-65.6	-215.87
Net gain on sale of mutual fund investments	-0.3	-0.35
Share of loss/ profit of associate	0.22	0.96
Fair value gain/ loss on derivative	1.96	-5.82
Payment of principal portion of lease liabilities		-23.75
Provision for share based payment expenses	16.83	126.69
Provision for inventories obsolescence	-20.25	5.28
Provision for the trade receivables and advances	-0.2	255.28
Amortization of prepaid security deposit	0.97	1.28
Interest expense	427.75	322.82
Interest income	-74.77	-73.2
Operating profit before working capital changes	2673.26	3391.65
Movements in working capital:
Increase/ decrease in trade payables and other liabilities	511.58	-423.65
Increase/ decrease in provisions	-10.73	-14.7
Increase/ decrease in in trade receivables	-1841.69	-919.54
Increase/ decrease in in inventories	-512.21	-738.42
Increase/ decrease in other assets	-189.09	-351.42
Cash generated from operations	631.12	943.92
Income taxes paid	-262.22	-390.69
Net cash flow from/ used in operating activities	368.91	553.23
Cash flow from investing activities
Purchase of property, plant and equipment	198.36	-1910.38
Proceeds from sale of property, plant and equipment	3.16	0.17
Investment in equity shares of other companies	-291.79	-244.1
Purchase of mutual fund investments	-53.5	-419.98
sale of mutual fund investments	25	430.37
Investment in bank deposits	-2859.66	-943.04
Maturity of bank deposits	2995.09	1441
Interest received	49.22	39.73
Net cash flow from/ used in investing activities	65.89	-1606.23
Cash flow from financing activities
Proceeds from issuance of equity	–	1020
Proceeds from issuance of NCD	–	250
Proceeds from long-term borrowings	-71.03	301.67
Movement in short term borrowings	-94.72	349.78
Interest paid on lease liability	-18.68	-20.78
Payment of principal portion of lease liabilities	-33.8
Interest paid on borrowings	-387.79	-257.62
Net cash from/ used in financing activities	-606.02	1643.05
Net increase in cash and cash equivalents	-171.23	590.05
Effect of exchange rates on translation of operating cashflows	204.12	37.4
Cash and cash equivalents at the beginning of the year	930.69	238.75
Cash of China bird as acquisition happened during the year	–	64.49
Cash and cash equivalents at the end of the year	963.59	930.69

Here is a summary of the Cash Flow Statement for the years 2023 and 2022:

Cash Flow from Operating Activities

Profit Before Tax:

2023: ₹988.06 thousand

2022: ₹2031.11 thousand

A decrease in profit before tax, indicating reduced profitability.

Adjustments to Reconcile Profit Before Tax to Net Cash Flows:

Depreciation:

2023: ₹1400.54 thousand

2022: ₹967.14 thousand

Increase in depreciation, suggesting higher capital investments or a change in depreciation policy.

Profit/Loss on Sale of Property, Plant, and Equipment:

2023: ₹-1.95 thousand

2022: ₹0.08 thousand

Loss in 2023 compared to a small profit in 2022.

Unrealized Foreign Exchange Gain/Loss:

2023: ₹-65.60 thousand

2022: ₹-215.87 thousand

Reduced unrealized foreign exchange losses.

Net Gain on Sale of Mutual Fund Investments:

2023: ₹-0.30 thousand

2022: ₹-0.35 thousand

Slight decrease in net gain.

Share of Loss/Profit of Associate:

2023: ₹0.22 thousand

2022: ₹0.96 thousand

Minor decrease in share of loss/profit.

Fair Value Gain/Loss on Derivative:

2023: ₹1.96 thousand

2022: ₹-5.82 thousand

Shift from loss to gain.

Payment of Principal Portion of Lease Liabilities:

No entry in 2023.

2022: ₹-23.75 thousand

Provision for Share-Based Payment Expenses:

2023: ₹16.83 thousand

2022: ₹126.69 thousand

Significant decrease in share-based payment provisions.

Provision for Inventories Obsolescence:

2023: ₹-20.25 thousand

2022: ₹5.28 thousand

Reversal of provision for inventory obsolescence.

Provision for Trade Receivables and Advances:

2023: ₹-0.20 thousand

2022: ₹255.28 thousand

Reversal of provision for trade receivables and advances.

Amortization of Prepaid Security Deposit:

2023: ₹0.97 thousand

2022: ₹1.28 thousand

Slight decrease in amortization.

Interest Expense:

2023: ₹427.75 thousand

2022: ₹322.82 thousand

Increase in interest expenses.

Interest Income:

2023: ₹-74.77 thousand

2022: ₹-73.20 thousand

Slight increase in interest income.

Operating Profit Before Working Capital Changes:

2023: ₹2673.26 thousand

2022: ₹3391.65 thousand

Decrease in operating profit before working capital changes.

Movements in Working Capital:

Increase/Decrease in Trade Payables and Other Liabilities:

2023: ₹511.58 thousand

2022: ₹-423.65 thousand

Increase in trade payables and other liabilities.

Increase/Decrease in Provisions:

2023: ₹-10.73 thousand

2022: ₹-14.70 thousand

Decrease in provisions.

Increase/Decrease in Trade Receivables:

2023: ₹-1841.69 thousand

2022: ₹-919.54 thousand

Significant increase in trade receivables.

Increase/Decrease in Inventories:

2023: ₹-512.21 thousand

2022: ₹-738.42 thousand

Decrease in inventory levels.

Increase/Decrease in Other Assets:

2023: ₹-189.09 thousand

2022: ₹-351.42 thousand

Decrease in other assets.

Cash Generated from Operations:

2023: ₹631.12 thousand

2022: ₹943.92 thousand

Decrease in cash generated from operations.

Income Taxes Paid:

2023: ₹-262.22 thousand

2022: ₹-390.69 thousand

Decrease in income taxes paid.

Net Cash Flow from/Used in Operating Activities:

2023: ₹368.91 thousand

2022: ₹553.23 thousand

Decrease in net cash flow from operating activities.

Cash Flow from Investing Activities

Purchase of Property, Plant, and Equipment:

2023: ₹198.36 thousand

2022: ₹-1910.38 thousand

Significant reduction in capital expenditures.

Proceeds from Sale of Property, Plant, and Equipment:

2023: ₹3.16 thousand

2022: ₹0.17 thousand

Increase in proceeds from asset sales.

Investment in Equity Shares of Other Companies:

2023: ₹-291.79 thousand

2022: ₹-244.10 thousand

Increase in investments in equity shares.

Purchase of Mutual Fund Investments:

2023: ₹-53.50 thousand

2022: ₹-419.98 thousand

Decrease in purchase of mutual fund investments.

Sale of Mutual Fund Investments:

2023: ₹25.00 thousand

2022: ₹430.37 thousand

Decrease in sale of mutual fund investments.

Investment in Bank Deposits:

2023: ₹-2859.66 thousand

2022: ₹-943.04 thousand

Significant increase in investments in bank deposits.

Maturity of Bank Deposits:

2023: ₹2995.09 thousand

2022: ₹1441.00 thousand

Increase in maturity of bank deposits.

Interest Received:

2023: ₹49.22 thousand

2022: ₹39.73 thousand

Increase in interest received.

Net Cash Flow from/Used in Investing Activities:

2023: ₹65.89 thousand

2022: ₹-1606.23 thousand

Improvement from negative to positive net cash flow from investing activities.

Cash Flow from Financing Activities

Proceeds from Issuance of Equity:

No proceeds in 2023.

2022: ₹1020.00 thousand

Proceeds from Issuance of NCD:

No proceeds in 2023.

2022: ₹250.00 thousand

Proceeds from Long-Term Borrowings:

2023: ₹-71.03 thousand

2022: ₹301.67 thousand

Decrease in proceeds from long-term borrowings.

Movement in Short-Term Borrowings:

2023: ₹-94.72 thousand

2022: ₹349.78 thousand

Decrease in short-term borrowings.

Interest Paid on Lease Liability:

2023: ₹-18.68 thousand

2022: ₹-20.78 thousand

Slight decrease in interest paid on lease liability.

Payment of Principal Portion of Lease Liabilities:

2023: ₹-33.80 thousand

No entry in 2022.

Interest Paid on Borrowings:

2023: ₹-387.79 thousand

2022: ₹-257.62 thousand

Increase in interest paid on borrowings.

Net Cash from/Used in Financing Activities:

2023: ₹-606.02 thousand

2022: ₹1643.05 thousand

Shift from positive to negative net cash flow from financing activities.

Net Increase/Decrease in Cash and Cash Equivalents

Net Increase/Decrease:

2023: ₹-171.23 thousand

2022: ₹590.05 thousand

Shift from increase to decrease in cash and cash equivalents.

Effect of Exchange Rates on Translation of Operating Cash Flows:

2023: ₹204.12 thousand

2022: ₹37.40 thousand

Significant increase in the effect of exchange rates.

Cash and Cash Equivalents at the Beginning of the Year:

2023: ₹930.69 thousand

2022: ₹238.75 thousand

Reflects the prior year ‘s closing balance.

Cash of China Bird as Acquisition Happened During the Year:

No entry in 2023.

2022: ₹64.49 thousand

Financial Ratios of Lava International Limited

Ratios	2023	2022
Current ratio	1.58	2.52
Debt-equity	0.23	0.14
Debt service coverage ratio	1.06	1.42
Return on equity	2.78%	3.07%
Inventory turnover ratio	5.04	4.78
Trade receivable turnover ratio	3.98	2.29
Trade payable turnover ratio	5.18	4.39
Net capital turnover ratio	2.91	1.81
Net profit ratio	1.60%	2.23%
Return on capital employed	7.24%	4.90%
Return on investment	4.04%	4.24%

Here is a summary of the financial and operational metrics for Lava International Limited for the year 2023 & 2022:

Current Ratio

2023: 1.58

2022: 2.52

Insight: The current ratio has decreased from 2.52 in 2022 to 1.58 in 2023. This indicates a reduction in the company’s ability to cover its short-term liabilities with its short-term assets. Although a current ratio above 1 is generally considered healthy, the significant decrease suggests a potential liquidity issue or a change in working capital management.

Debt-Equity Ratio

2023: 0.23

2022: 0.14

Insight: The debt-equity ratio has increased from 0.14 to 0.23. While the company is still conservatively leveraged, the increase suggests a higher reliance on debt financing compared to equity. This could impact the company’s financial stability if the trend continues.

Debt Service Coverage Ratio

2023: 1.06

2022: 1.42

Insight: The debt service coverage ratio has decreased from 1.42 to 1.06, indicating that the company’s ability to cover its debt obligations has weakened. A ratio above 1 indicates the company can still cover its debt payments, but the decline is a concern and could indicate potential cash flow issues.

Return on Equity (ROE)

2023: 2.78%

2022: 3.07%

Insight: The ROE has slightly decreased from 3.07% to 2.78%, suggesting a minor decline in profitability relative to shareholders ‘ equity. This indicates that the company’s ability to generate profits from its equity base has weakened slightly.

Inventory Turnover Ratio

2023: 5.04

2022: 4.78

Insight: The inventory turnover ratio has improved from 4.78 to 5.04, indicating better efficiency in managing and selling inventory. This improvement suggests that the company is effectively managing its stock levels and generating sales.

Trade Receivable Turnover Ratio

2023: 3.98

2022: 2.29

Insight: The trade receivable turnover ratio has increased from 2.29 to 3.98, indicating improved efficiency in collecting receivables. This means that the company is collecting its debts faster, which is positive for cash flow.

Trade Payable Turnover Ratio

2023: 5.18

2022: 4.39

Insight: The trade payable turnover ratio has increased from 4.39 to 5.18, suggesting that the company is paying its suppliers more quickly. While this can be a sign of strong liquidity, it may also indicate less favorable credit terms with suppliers.

Net Capital Turnover Ratio

2023: 2.91

2022: 1.81

Insight: The net capital turnover ratio has significantly increased from 1.81 to 2.91, indicating that the company is generating more revenue per unit of capital employed. This improvement suggests better utilization of capital in generating sales.

Net Profit Ratio

2023: 1.60%

2022: 2.23%

Insight: The net profit ratio has decreased from 2.23% to 1.60%, indicating a decline in profitability. This suggests that the company is earning less profit per unit of revenue, which could be due to higher costs or lower revenue.

Return on Capital Employed (ROCE)

2023: 7.24%

2022: 4.90%

Insight: The ROCE has increased from 4.90% to 7.24%, indicating better efficiency in generating profits from the company’s capital. This suggests improved performance in utilizing capital to generate earnings.

Return on Investment (ROI)

2023: 4.04%

2022: 4.24%

Insight: The ROI has slightly decreased from 4.24% to 4.04%, indicating a minor decline in the returns generated from investments. This suggests that the company’s investments are yielding slightly lower returns compared to the previous year

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