When I spotted Sankaran Naren of ICICI Mutual Fund quietly scooping up a chunk of Gateway Distriparks stock in July 2014, I immediately sounded the red alert. I remarked at that time that Sankaran Naren is a value investor to the core and that he does not touch a stock if he is not convinced about its fundamentals and valuations. Also Naren expects his stocks to deliver hefty gains, sooner or later.
Well, I was perfectly correct in my prognosis because while Sankaran Naren bought the stock at Rs. 228, today the price is Rs. 342, giving gains of 50% in less than six months.
Today, we have a sense of Déjà vu because another value investor of impeccable credentials is walking the same path in buying Gateway Distriparks.
Akash Prakash is the founder of Amansa Capital and manages a massive AUM of nearly Rs. 5000 crore. In an interview to Saurabh Mukherjea in the bestseller “Gurus of Chaos”, Akash Prakash disclosed that his investment philosophy is very simple. He buys stocks of top quality companies, run by competent management, which have a “long runway” ahead of them, and which are quoting at reasonable valuations.
This is borne out by Amansa Capital’s latest portfolio which is crammed with multi-baggers like Eicher Motors, Federal Bank, Ashok Leyland, Cholamandalam etc.
So, it is very significant that yesterday (18th December) Amansa Capital bought 34 lakh shares of Gateway Distriparks at Rs. 334 each, shelling out Rs. 113.56 crore.
What appears to have attracted Akash Prakash to Gateway Distriparks is the fact that the company is expected to be one of the big beneficiaries of the Goods & Services Tax (GST) Act, when passed by Parliament.
This was confirmed by Arvind Sanger, whiz-kid with Geosphere Capital in an interview to ET. He said “If you have GST then you have the freight corridors coming up then clearly companies like Gateway Distriparks will have some significant tailwinds for the next several years and will be very well positioned”.
Sharekhan has also supported this analysis by pointing out that companies like Gateway Distriparks and Concor will be major beneficiaries and that over the long term, the outlook of the rail freight business is extremely favourable given the investments in dedicated freight corridors. The secular growth caused by improving macro-economic environment will also have a positive effect on the logistic companies like Concor and Gateway Distriparks.