My portfolio includes:
Bajaj finance: 26%
Ugro Capital: 19%
RBA: 9%
Samhi Hotels: 8%
Aavas Financiers: 12 %
Sona BLW: 14%
Aether Industries: 9%
What do this about it?
My portfolio includes:
Bajaj finance: 26%
Ugro Capital: 19%
RBA: 9%
Samhi Hotels: 8%
Aavas Financiers: 12 %
Sona BLW: 14%
Aether Industries: 9%
What do this about it?
Why not Ugro capital for betting on growing MSME financing sector, NBFC should do better as compared to banks or SFBs?
Hi Community,
Would like to share a though and seek your feedback!
Sona BLW is a R&D driven organization and playing in the EV adoption theme. EV adoption is inevitable, now or later cars will transition to EV, management also said that by the end of 2035 most of the automobiles are going to be EV.
I have the following thesis points:
Company is trading at rich valuation, it does justified as there are not many companies who has such a unique business model.
What do you think of the company and do you think Sona BLW is long term portfolio stock, that you can keep in your portfolio for the next 10-15years? Could it be a silent wealth creator?
Hello sir, thank you very much for asking such good question, there by clarifying our doubts with sir answer. Please expect reply from Vishu sir, I may wish to clarify a spec,
In answer to your queries.
I have not used their service, so will not be able to comment if the list is the same or not. I preferred to do things myself. It does not take me more than 15 min every weekend to process this data. This activity and subsequent results gives me a lot of satisfaction.
The overall reduction in XIRR is couple of % points. When the XIRR of pf is 80%+, I don’t mind losing some to DP charges or STT.
I follow different rebalancing strategy for different market caps. For this and the microcap pf, I do weekly. For midcap, it is 15 days and for Nifty 50 / Next 50, I do it monthly.
I believe 3 months is too long even for a large cap pf.
Churn costs will come down, but I guess the risks will be a lot higher.
We are looking at creating a pf that is system driven without any discretion. Therefore, if we keep a rebalancing frequency that is distant, you might be tempted to rebalance using discretion.
My view -
Company has done backward integration by putting plant to manufacture required raw materials, prima-facie it seems strategically good decision.
but what they are going to manufacture are all commodity products, which will earn returns above cost of capital for few years and then below cost of capital for next few years.
I would have liked to see capex in existing products they manufacture instead of those commodity products.
Rational managements always try to earn better returns than existing or at least same returns, this decision of such a magnitude of investment seems completely irrational to me.
If someone has connections, please ask the exiting promoter (Dashrathbhai Patel) why he is exiting?
Not Invested
++ to add to above point on ebitda
last year ebitda is 275 crore
FY 25 would be
275 +
40 crore from esop saving +
4% * 275 = 11 crore from corporate g & a +
10% revenue growth might result in 14% ebitda growth = 275 * .14 = 38.5
Total = 275 + 40 = 315+11 = 326 + 38.5 = 366 crore roughly for FY 25
ev/ebitda multiple of 16 gives 6222 crore valuation
Which is very close to the current enterprise valuation
4200 + 2153 debt = 6353 crore
Now, are any of the mutual funds getting such a pristine quality NBFC at such as cheap valuation? I doubt.
SBFC, Fivestar and Ugro are all MSME lender, i guess we can compare them. Also, their target customers in many ways are also similar.
Now, are any of the mutual funds getting such a pristine quality NBFC at such as cheap valuation? I doubt.
SBFC, Fivestar and Ugro are all MSME lender, i guess we can compare them. Also, their target customers in many ways are also similar.
Hitesh Sir,
As many experienced & seasoned investment gurus say that low base capital investors need to first build a decent corpus with aggressive but sensible investing and then look for wealth creation through that decent corpus.
Being an aggressive investor with high risk appetite and low capital base, is it advisable to invest in fundamentally decent/good SME and mirco cap stocks.
Of course, the investment will be after proper study.
Regards.
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