Nikhil, getting into a business is easy but maintaining profitability, growth may not be easy. I wld like to draw your attention to the rush into airline business in mid 90's, rush into software in late 90's. Similarly rush into the auto sector in the US in the begining of the 20th century. So 60-70 more HFC's, but how many wld remain, time will tell. Secondly the story sld be more than a 10 yr story because urban housing shortage is approx 20 mill and about 8 lacs or so new units are added p.a. And according to estimates about 30 cr pepole expected to move to citites by 2030 ( source: nhb.org.in/publications). The 8 lac figure is frm elsewhere, forgetting the source. Rural housing shortage is even more.
Regards
Discl: invested
Posts tagged Value Pickr
REPCO home finance – another Gruh in the making? (13-11-2015)
Canfin homes ltd (13-11-2015)
It came in ET day before yesterday full page, I think they are preparing before their IPO
REPCO home finance – another Gruh in the making? (13-11-2015)
@RamanTiwari: Repco is one of my largest holding. Still I would like to disagree with couple of points.
Growth visibility for 10 years - HFC space is now super competitive with 60-70 HFC's. Every NBFC is now into mortgage lending. So consistently growing at 25% for 10 years is difficult task. 15-18% over that period is reasonable.
Price doubling every 3 years from this point looks almost impossible. It's not every day that an HFC is valued at 30-40 PE. This is bull market and we should not forget that valuations are much higher than they normally should.
Canfin homes ltd (13-11-2015)
Could you let us know where you have found the financials of PNB Housing FInance?
Kaveri Seeds – Temporary thread for clarifications (13-11-2015)
i think the company turned a loss in a qtr for the first time since 2008.
Kaveri Seeds – Temporary thread for clarifications (13-11-2015)
pretty horrible results for this qtr, high base effect notwithstanding:
http://www.bseindia.com/xml-data/corpfiling/AttachLive/A797E76C_5AE4_40D8_8A00_F4C1CF0E73BE_133208.pdf
disc: invested.
Thomas Cook India-Will it move like Warren Buffet Stock (13-11-2015)
Perhaps there are some clauses in the agreement between Thom Cook and Ikya at the time of takeover by Thom Cook; may be there was some understanding not reduced to writing then and which Mr Issac wants to 'regularise' now. This move is definitely anti minority shareholders in the short and perhaps in the medium term.
Page industries (13-11-2015)
Any idea on the analyst meet for this quarter, unable to find anything around it on the net ?
Entertainment Network India Limited (ENIL) (13-11-2015)
Hi Arjun,
In my understanding, management had always maintained that it will need some debt to fund the renewal of existing frequency and acquiring new frequency in Phase-III. In fact, management had indicated in Q2 Concall, that they had spent around 50 odd crores more than what they had budgeted for which I feel is commendable in the context of extraordinary high prices paid for some frequencies by some bidders. So, My understanding is that 150-200 Crore debt was always on cards and it quite manageable in the context of their very strong cash flows of 100 odd crores + (and growing!)
Coming to ROE, as I mentioned business has two distinct characteristics
- Cash flow is much more than PAT after few years of auction thus ROE (which is PAT/Total equity) is not an accurate measure as it understates the returns from the business
- Secondly, by very nature, this is a business where business accumulates cash an then deploys it at once (during auctions and renewals). Typically, such cash flow focused businesses are evaluated on IRR basis and ROE may not be a right measure.
Though, ROE is very good measure for most of the businesses, it may not be an optimal one for few. This is one such business where ROE may give a wrong impression of the business characteristics
Canfin homes ltd (13-11-2015)
Dear GKNRAO,
No offence, but if you are preparing a presentation on the Housing Finance sector, it would be better to go through the companys' websites and compile the information. It could help you get a better understanding of the sector as you read and try to dig out the information, and who knows, perhaps you may stumble onto some insight/observations which could lead to a better presentation.
Apologies for butting in like this.