Over the past one month, Porinju has been repeatedly storming the Ansal Buildwell counter and grabbing truckloads of the stock.
His first foray was on 23rd March 2015, when he scooped up a chunk of 55,000 shares at Rs. 64.25 each. Then, on 16th April 2015, when the stock had moved up to Rs. 99.41, Porinju again went to the counter and bought a chunk of 45,000 shares. Today, again, Porinju couldn’t resist the temptation. He bought yet another chunk of 50,000 shares at Rs. 113.45.
Porinju’s total investment in Ansal Buildwell now stands at 150,000 shares. The investment is worth Rs. 1.78 crore at the CMP of Rs. 118. The beneficiary of the investment is Porinju’s fund called ‘Equity Intelligence India Pvt. Ltd’.
The reason for Porinju’s fascination with Ansal Buildwell is not difficult to find.
Porinju is convinced that Ansal Buildwell is a “deep value” and highly mispriced stock. On an earlier occasion, he pointed out in his tweet that while Ansal’s enterprise value (EV) is Rs. 100 crore, the worth of its land (development potential) is over Rs. 5000 crore.
In fact, Porinju also provided a link to an interview to Ansal Buildwell’s director on CNBC TV18 where the latter confirmed that the company is now intending to shed its sluggish past and monetize the potential of the vast lands held by it. The Director suggested that the developable potential of the land is close to Rs. 10,000 crore.
Porinju is playing according to his game plan of hoarding stocks of “low quality” promoters available at bargain basement prices. His theory is that someday the perception will shift and the so-called low quality promoters will be in great demand.
He reiterated this theory in his latest tweet:
Look at deep value, 'low quality promoter' real estate stocks; declining trend in black money transactions to benefit minority shareholders!
— Porinju Veliyath (@porinju) April 19, 2015
(Look at deep value, ‘low quality promoter’ real estate stocks; declining trend in black money transactions to benefit minority shareholders!)
So, if Porinju Veliyath had his way, he would probably buy over the entire company instead of just bits and pieces of the stock.