maverick
11-12-2007, 07:04 AM
Consolidated Finvest-Maximising Wealth, Minimising Risk
BSE 500226
Consolidated Finvest and Holdings Limited belongs to the Shyam Jindal stable, being the repository of a huge portfolio of listed shares, unlisted group companies and liquid mutual fund assets worth close to Rs 570 crore, with major holdings that include Asian Hotels, Jindal Photo, Jindal Polyfilms, Prakash Industries and Ester Industries. The stock at Rs 57 quotes at a massive 68 per cent discount to NAV of Rs 180 per share, and this gap should get rapidly bridged over the next six months.
The Promoters hold a majority stake of 67 per cent. With whom one of the recent entrants to India, the legendary Ruanne Cunniff and Goldfarb Fund-Account Acacia Partners, and also one of the savviest investors in the game has entered the stock with a near 7 per cent Equity stake. This leaves a mere 26 per cent holding with the public at large.
The financials of Consolidated Finvest are just too strong to ignore. For FY07, Consolidated Earnings after tax worked out to Rs 28.11 crore or Rs 9 per share approximately and the corporate came out with a nominal dividend on its shares.
More important, than earnings per share are the stocks which are held and how well they are doing independently. This is where Consolidated Finvest has picked its stocks well. It owns Asian Hotels (1974999 shares) one of the finest Hotel property in New Delhi that runs the Hyatt Delhi. Consolidated Finvest also holds 316,141 shares of Jindal Photo Films and 70,15, 951 shares of Jindal Polyfilms.
The Value of Quoted Investments as of December 7, 2007 worked out to Rs 326 crore, and the Liquid Mutual Fund Investments worked out to another Rs 81 crore.
Quite significantly, the corporate holds Rs 100 crore in unlisted concerns and these investments are being carried at cost. Some of these investments like those in Jindal Thermal may get unlocked soon, and others in Real Estate concerns like Vigil Farms should have multiplied in quantum terms given the rapid rise in Real Estate prices around New Delhi.
Some of the Investments held by Consolidated Finvest are carving out their own expansion plans and those like Jindal Photo's expansion will be worth over a $ 1 bn. Jindal Photo has been allotted a Coal Mining Block in Orissa alongside which would be set up a 600 MW Thermal Power Plant initially, worth Rs 2500 crore. The capacity of this unit will be ultimately raised to 1000 MW involving an investment of Rs 5000 crore including mine development costs.
In all probability, Jindal Photo may put up this power plant under Jindal Thermal-an unlisted entity, owned by Consolidated Finvest, which has been set up for the purpose.
The advantage for shareholders at large is that they minimise risk by investing in a diversified basket of stocks owned directly by Consolidated Finvest, instead of taking a stock specific risk.
Also, the significant 68 per cent discount to NAV of Consolidated Finvest is akin to buying the Sensex at a level of 6000 giving a major protection against any adversity.
At the same time, entering at current levels in the Consolidated Finvest stock implies partaking in the Value Accretion that independent expansion plans of Jindal Photo, Jindal Polyfilms, Jindal Thermal and Vigil Farms will bring in as the Indian Economy continues to roll forth at a healthy clip exceeding 8 per cent per annum over the next 5 years.
BSE 500226
Consolidated Finvest and Holdings Limited belongs to the Shyam Jindal stable, being the repository of a huge portfolio of listed shares, unlisted group companies and liquid mutual fund assets worth close to Rs 570 crore, with major holdings that include Asian Hotels, Jindal Photo, Jindal Polyfilms, Prakash Industries and Ester Industries. The stock at Rs 57 quotes at a massive 68 per cent discount to NAV of Rs 180 per share, and this gap should get rapidly bridged over the next six months.
The Promoters hold a majority stake of 67 per cent. With whom one of the recent entrants to India, the legendary Ruanne Cunniff and Goldfarb Fund-Account Acacia Partners, and also one of the savviest investors in the game has entered the stock with a near 7 per cent Equity stake. This leaves a mere 26 per cent holding with the public at large.
The financials of Consolidated Finvest are just too strong to ignore. For FY07, Consolidated Earnings after tax worked out to Rs 28.11 crore or Rs 9 per share approximately and the corporate came out with a nominal dividend on its shares.
More important, than earnings per share are the stocks which are held and how well they are doing independently. This is where Consolidated Finvest has picked its stocks well. It owns Asian Hotels (1974999 shares) one of the finest Hotel property in New Delhi that runs the Hyatt Delhi. Consolidated Finvest also holds 316,141 shares of Jindal Photo Films and 70,15, 951 shares of Jindal Polyfilms.
The Value of Quoted Investments as of December 7, 2007 worked out to Rs 326 crore, and the Liquid Mutual Fund Investments worked out to another Rs 81 crore.
Quite significantly, the corporate holds Rs 100 crore in unlisted concerns and these investments are being carried at cost. Some of these investments like those in Jindal Thermal may get unlocked soon, and others in Real Estate concerns like Vigil Farms should have multiplied in quantum terms given the rapid rise in Real Estate prices around New Delhi.
Some of the Investments held by Consolidated Finvest are carving out their own expansion plans and those like Jindal Photo's expansion will be worth over a $ 1 bn. Jindal Photo has been allotted a Coal Mining Block in Orissa alongside which would be set up a 600 MW Thermal Power Plant initially, worth Rs 2500 crore. The capacity of this unit will be ultimately raised to 1000 MW involving an investment of Rs 5000 crore including mine development costs.
In all probability, Jindal Photo may put up this power plant under Jindal Thermal-an unlisted entity, owned by Consolidated Finvest, which has been set up for the purpose.
The advantage for shareholders at large is that they minimise risk by investing in a diversified basket of stocks owned directly by Consolidated Finvest, instead of taking a stock specific risk.
Also, the significant 68 per cent discount to NAV of Consolidated Finvest is akin to buying the Sensex at a level of 6000 giving a major protection against any adversity.
At the same time, entering at current levels in the Consolidated Finvest stock implies partaking in the Value Accretion that independent expansion plans of Jindal Photo, Jindal Polyfilms, Jindal Thermal and Vigil Farms will bring in as the Indian Economy continues to roll forth at a healthy clip exceeding 8 per cent per annum over the next 5 years.