Thanks, @Ketan_Chheda, @vibhor_vaish, and @paragbharambe for sharing your thoughts! I really appreciate it.
Here is my summary
Mr. Market Concerns (Cons)
- Asset quality
- Inexperience in the Retail lending business (It is outside of their core strength for wholesale (real estate) leading business)
- Some PEL investors are interested in their Pharma business. They are selling their Financial business after the entities emerged.
- Fear of DHFL acquisition
- RBI’s new regulation for NBFC
- Competition from Banks and Fintech
Pros
- Good management track record (Textile → Phrama → NBFC)
22% Revenue CAGR for 34 years
26% Net Profit CAGR for 34 years
They started their journey with the Textile business and successfully converted the Pharma business. Now added NBFC in the emperor. - No corporate governance issue as per my knowledge
- Good valuation the PEL market value (stock price is ~800 and market cap is ~19k crore) is 0.5% of its book value.
- Skin in the game (more than 50% promoters holding)
- Trying to get a Bank license.
Feel free to let me know if I miss anything here.
Note: Invested in COVID time and will increase holding.
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