Water management in South Asia is a messy patchwork of agreements. Closer co-operation would keep rivers flowing, while keeping the peace https://t.co/usPEpbtuiFPhoto: Getty Images https://t.co/uaRjDupxkr ...

Core Insights - Advanced Drainage Systems, Inc. (ADS) reported strong financial results for the second quarter of fiscal 2026, with a revenue increase of 8.7% year-over-year, reaching $850.4 million, driven by growth in core markets and acquisitions [2][3][9]. Financial Performance - Net sales increased by $67.8 million, or 8.7%, compared to the prior year quarter, with domestic pipe sales rising 1.6% to $413.0 million and allied products sales increasing 13.0% to $199.0 million [3][10]. - Infiltrator sales surged by 25.2% to $179.7 million, attributed to the acquisition of Orenco Systems and strong growth in tanks and advanced treatment products [3][10]. - Gross profit rose by $46.2 million, or 15.7%, to $340.1 million, primarily due to volume growth and favorable pricing [4][11]. - Selling, general and administrative expenses increased by 26.7% to $119.2 million, largely due to the acquisition of Orenco and related transaction costs [5][12]. - Net income per diluted share increased by 19.2% to $1.99, supported by the factors mentioned above and a $17.6 million gain on the sale of assets [6][13]. Adjusted Metrics - Adjusted EBITDA increased by 17.1% to $287.5 million, with a margin of 33.8%, compared to 31.4% in the prior year [7][13]. - Year-to-date fiscal 2026 results showed net sales of $1.68 billion, a 5.2% increase, with net income rising 2.4% to $300.6 million [9][10]. Acquisition Strategy - ADS announced plans to acquire NDS, a leading U.S. supplier of residential stormwater and irrigation products, in a transaction valued at approximately $1.0 billion, aimed at enhancing its product portfolio and market capabilities [2][17]. - The acquisition is expected to unlock over $25 million in annual cost synergies and is anticipated to close in the first quarter of calendar year 2026 [17][18]. Outlook - The company updated its fiscal 2026 guidance, projecting net sales between $2.9 billion and $2.99 billion and Adjusted EBITDA between $900 million and $940 million [19].

Core Thesis - Franklin Electric Co., Inc. is positioned as a compelling investment opportunity due to its critical role in water and fuel infrastructure, high-margin growth potential, and stable demand across its segments [1][4]. Company Overview - Franklin Electric, founded in 1944, initially produced portable generators and later shifted focus to water systems, creating the first commercially viable submersible motor in 1953, which significantly improved agricultural efficiency and global food security [2]. - The company's Water Systems segment remains central to its operations, reflecting a history of technological leadership and consistent demand, including specialized solutions for mining and construction [3]. Financial Performance - As of September 30th, Franklin Electric's shares were trading at $95.20, with trailing and forward P/E ratios of 24.64 and 20.16 respectively [1]. - The Energy Systems segment, while accounting for approximately 13% of revenue, contributes over 30% of operating income due to high operating margins exceeding 30% [4]. Market Position and Growth Opportunities - Franklin Electric provides essential infrastructure solutions that support agriculture, construction, and fueling systems, leading to durable demand and resilient cash flow [4]. - The company benefits from secular tailwinds in water management, energy infrastructure, and regulatory compliance, making it a stable, high-margin industrial operator with significant growth opportunities [4].

Community & Social Impact - The speaker emphasizes the importance of community involvement and taking action to address local issues, rather than just complaining about the lack of action from others [52] - The initiative to restore the lake in பேராவூர்ணி (Peravurni) began with a small association fund of ₹1,000, highlighting the power of collective effort, despite initial skepticism [27][28] - The community rallied together to support the lake restoration project, with contributions ranging from cricket tournament winnings to savings from a 100-day work program, and even a newly married couple donating their treat money [30][31][32] - The speaker was deeply moved when an elderly farmer, who had been forced to cultivate land in other districts due to water scarcity, presented him with the first harvest as a symbol of gratitude, acknowledging him as a "சாமி" (god) [48][49][50][51] Water Management & Agriculture - The speaker highlights the issue of water wastage in the காவேரி (Cauvery) delta region, with 110 TMC (Thousand Million Cubic feet) of water being wasted in the speaker's region during 2016-2017, enough to supply Chennai for 20 years [21][22] - The restoration of a 564-acre lake in பேராவூர்ணி (Peravurni) led to a significant rise in the water level (50 feet), revival of failed borewells, and a resurgence in farming activities [25][38] - The cost of restoring the lake was ₹27 lakhs, significantly lower than the government's estimated budget of ₹4 crore, showcasing the efficiency of community-led initiatives [39] - In Ramanathapuram, where people used to walk 8-10 kilometers daily for water, the lake restoration projects saved women 8 hours of travel time, enabled children to attend school, and brought people back to farming [56][57][58][59] Disaster Relief & Resilience - The speaker initiated a Facebook group called "கஜா புயல் மீட்பு குழு" (Gaja Cyclone Relief Team) to provide assistance during the கஜா (Gaja) cyclone, despite facing ridicule and skepticism from the community [9][10] - The speaker extended his vacation and stayed back to help with disaster relief efforts after the கஜா (Gaja) cyclone, recognizing the potential for significant impact [8] - The speaker and his team initially focused on providing emergency relief, clearing roads, and distributing groceries after the கஜா (Gaja) cyclone [15]

Group 1 - Madison Small Cap Fund's second-quarter 2025 performance was impacted by initial tariff issues but later rebounded due to a pause in tariff implementation and positive macroeconomic data [1] - The Russell 2000 Index increased by 8.5% for the quarter and is down only 1.79% year-to-date, while Madison Small Cap Fund (class Y) returned 4.42% in the quarter, underperforming compared to the Russell 2000 and Russell 2500 [1] - The fund's top five holdings were highlighted as key investment picks for 2025 [1] Group 2 - Advanced Drainage Systems, Inc. (NYSE:WMS) is a leading manufacturer of thermoplastic corrugated pipes and related water management products, with a market capitalization of $10.933 billion [2] - The stock of Advanced Drainage Systems, Inc. experienced a one-month return of 0.12% and a 52-week decline of 9.63%, closing at $140.61 per share on September 17, 2025 [2] - The company holds a dominant position in the stormwater management subsector, being ten times the size of its nearest competitor, and provides solutions that address increasing storm frequency and intensity [3]