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Posts tagged Value Pickr
Indian Energy Exchange (IEX) (05-06-2024)
The boat has rocked(results) enough, lets not rock it anymore(destabilize Electric exchange which is not ideal, but not bad either).
For now, shelve it and approach later could be another speculation.
Omkar’s Portfolio Analysis and Discussion (05-06-2024)
Cera - Getting constructive, tracking position soon
Following are not the reasons why I am getting constructive on Cera
- Industry tailwinds
- 2-3 years earnings outlook
- Any immediate earnings trigger
Following is the reason why I am going to take tracking position in Cera (1-2%)
- Odds of getting long term call ( good or bad ) - over 2-3 cycles - right are high. According to me returns over 2-3 cycles depend on answering following question right
Considering business will remain pretty much india focused over next 2-3 cycles - can company’s strategy of focussing on only two product lines- bathware and sanity ware making it vulnerable to competition or it will improve the focus and thereby making it harder and harder for a competition to break in?
Aadhar Housing Finance Limited (“AHFL”) – Good time to buy (05-06-2024)
Performing a fundamental analysis briefly on AHFL.
Facts:
- It is a HFC retail focused on the low income housing segment (ticket size less than Rs. 1.5 million) and has highest AUM and net worth among segment HFC peers.
- Present in 20 states and UT.
- In FY 23 it had highest number of live accounts.
- Average ticket size was Rs. 1 million in FY 23.
- Loan applications from salaried-customers go through its regional processing unit (“RPUs”), increasing efficiency while those from self-employed customers, which require close understanding of the customer and their cash flows, are managed regionally; this helps in lowering operational costs compared to banks and other HFC where everything is zonal for such customer types.
- Apparently they have some proprietary credit assessment model backed by Blackrock.
- Branch model is something unique for them: On a regional level, it has categorized branches as main and small branches which are hubs and it further penetrate deeper through micro or ultra-micro branches under the ambit of main or small branches. Usually the company establish its presence in a new location with an ultra-micro branch based on the geography, potential and low delinquency trends, and once the ultra-micro branch becomes profitable, it upgrades it to a small or main branch to cater to a larger pool of customers.
- Management team including BOD is with solid credentials and directly supervised by Blackstone as it has 75% stake. Important fact for Blackstone is that they are very much upbeat about real estate financing market in India since last 3 years.
Financial numbers (important only)
- gross AUM has been increasing at almost 18% yoy on 3y basis.
- revenue CAGR on 5y basis is 20%.
- operating profit margin for 5y has consistently been around 75%. Even EBITDA margin is around same for 5y basis.
- net profit CAGR on 5y basis has been 36%.
- long term debt is nil.
- ROCE has been hovering between 40-45% since last 3 years.
- ROE has been between 13-15% since last 3 years.
- cost of funds has been 7.6%.
- GNPA has improved to 1.08% which will reduce credit cost for this year.
- book size recently had reached 21000 crores.
View:
- demand for such loans is at almost 35 trillion rs in India. so i dont business building should be an issue.
- company is going to add 70-75 branches a year and venture to almost 25 states in next 2-3 years.
- they are also going to build books basis assignment and colending going forward.
- disbursements on qoq basis needs to be monitored closely as it has been flat in past for some parts.
- they also attach life insurance loans which is something critical for repayment by family for home loans and they have stated it is almost more than 50% loans.
- liquidity buffers are very good for such HFC by maintaining almost 6-8% consistently.
- sourcing mix is also good.
- government policy is also focused on increasing subsidy for affordable housing. will help them in book building further.
Based on the above, I believe it is a good company to be invested in as it is fairly valued. I think institutional money (including MF inflow) will also follow if performance remains in this manner.
Happy to receive feedback/ suggestions/ discussion etc. Thanks.
[Disclaimer: I am invested in this stock in June 2024 at entry price of 340.]
Discussions on broader market, economy and geopolitical events (05-06-2024)
Purpose of This Thread
Having been an active participant on ValuePickr for over three years, I’ve come to rely on this platform as my primary source for company news and developments. Given the wealth of knowledgeable investors here, I believe we have a unique opportunity to engage in productive discussions about broader market news and their potential impacts on various sectors and stocks. Staying informed about global geopolitical events and their secondary effects is crucial for making well-informed investment decisions.
Objectives
- Comprehensive Market Analysis:
- Understanding Broader Trends: Delve into macroeconomic trends and their implications on the market.
- Sector-Specific Insights: Analyze how specific sectors are influenced by current events and market trends.
- Geopolitical Events and Market Impact:
- Election Outcomes: Discuss the ramifications of election results on national and global markets.
- Policy Changes: Evaluate the impact of new policies and regulatory changes on different industries.
- Global Incidents: Consider the effects of international conflicts, treaties, and other geopolitical events on the market.
- Second-Order Effects:
- Ripple Effects: Explore the indirect consequences of major events on various sectors.
- Cross-Sector Influences: Understand how changes in one sector might influence another (e.g., how energy prices affect manufacturing costs).
- Informed Investment Choices:
- Risk Management: Identify potential risks arising from geopolitical and economic changes.
- Opportunity Identification: Spot opportunities created by market fluctuations and global events.
- Strategic Positioning: Discuss strategies for positioning portfolios to benefit from or mitigate the impact of current events.
Examples and Case Studies
- Current Election Outcomes: Analyze the market’s response to recent election results, including potential changes in fiscal policy, regulatory environment, and international trade agreements.
- Trade Wars and Tariffs: Discuss the impact of ongoing trade tensions between major economies and their effects on global supply chains and sectoral performance.
- Technological Advancements: Explore how breakthroughs in technology are reshaping industries and creating new investment opportunities.
Community Engagement
By fostering informed and insightful discussions, we can enhance our collective understanding of the market and make better investment decisions. I encourage everyone to share their perspectives, news sources, and analyses to contribute to a rich and diverse dialogue.
Let’s leverage the power of our community to stay ahead of the curve and navigate the complexities of the market with confidence and foresight.
Praveg Ltd: Play on Indian Tourism Industry! (05-06-2024)
Updates:
- Update the sheet for month of May.
- Expenses likely to be high going forward as well coz of ramping up of Lakshadweep Resorts.
- We will have better understanding by Q3 on the potential profit it can generate.
Indian Energy Exchange (IEX) (05-06-2024)
Not that straightforward but let’s speculate a step deeper
So basically the MBED means Market Based Economic Dispatch. This is a proposal to have a centralized clearinghouse that will sort all the sources of power and dispatch the lowest-cost ones, thereby lowering the cost of average power nationally. But this would theoretically impinge on the Electricity Act and independence of state-owned discoms. Now with a weaker Government at the center with a coalition with the state-level regional players, this issue of market coupling can become a contentious issue and with the dynamic of power shifting towards the state government and regional players they can dictate the center on multiple issues including this issue as well. So I don’t think that the loss of RK singh will impact market coupling, but dependence on the regional parties running state governments can.
IRB INVIT TRUST- new game in the town! (05-06-2024)
Thank you for this insight Shiva. But in the IRB concall, they maintain guidance of Rs 8 for the year and also mentioned slight increase of cash from new HAM asset. If that’s the case the div yield before any taxes is as Kalyan mentions above i.e 12%. They have enough space for debt and the toll revenue would increase slightly over time. So why is it not good for invit price if the invit doesn’t take more assets in the near future? Is it cus there are other options out there that do it and therefore might actually provide a better yield? Sorry for the long question:smiling_face_with_tear: