Porinju Veliyath has mastered the art of spotting “hidden gems” i.e. stocks which have a lot of embedded value in them but which are not given their true worth by the market for various reasons.
Ansal Buildwell is a case in point. Till a few days ago, the stock had no takers because it is in the unpopular realty sector and is backed by promoters with a so-so track record.
However, Porinju was not deterred by all the negatives that were floating around about the company. Instead, on 23rd March 2015, Porinju’s Equity Intelligence Fund bought a chunk of 55,000 shares of Ansal Buildwell Ltd at Rs. 64.25 each. He bought another chunk of 45,000 shares on 16th April 2015 at Rs. 99 per share.
Today, Ansal Buildwell closed at Rs. 108. This means that in less than four weeks since his first purchase, Porinju has raked in massive gains of 68%.
Porinju’s latest tweet suggests that Ansal Buildwell is deeply undervalued because it has assets worth Rs. 5000 crore while its enterprise value is only Rs. 100 crore.
Ansal Buildwell – Why 100 Cr EV for 5000 Cr wealth? http://t.co/hQuXt2Qosl
— Porinju Veliyath (@porinju) April 17, 2015
(Ansal Buildwell – Why 100 Cr EV for 5000 Cr wealth?)
Porinju has drawn attention to a talk by Ansal Buildwell’s director where he pointed out that the Company has low debt (about Rs. 100 crore) and that the development potential of the land bank held by it is in excess of Rs. 10,000 crore. The director also pointed out that while Ansal’s past has been ordinary with sluggish growth in sales and profits, its future is bright because it has several ambitious plans on the anvil.
So, it does look like Porinju Veliyath has got himself yet another multi-bagger stock to add to his roster of winning stocks.