nalanda capital

7/21/2019 Nalanda Capital

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Nalanda Capital’s Portfolio & TheSecrets To Finding Multibagger

Stocks

Pulak Chandan Prasad, the founder of Nalanda Capital Pte Ltd, is the man

with the golden touch. He is 45 years of age and has rich experience in

identifying winning companies. He did his !" from ## "hmeda$ad in %&&'

and (oined c)insey. *hereafter, in %&&+, he (oined ar$urg Pincus where

he learnt the ropes of e-uity inesting. He is credited with seeral

inestments /such as )otak ahindra !ank, 0intex #ndustries, Nicholas

Piramal #ndia, 0atyam Computer 0erices1 which gae ar$urg Pincusmulti$agger returns. He is $est known for the 23 million inestment that

ar$urg made in !harati "irtel which was sold for 2%.& $illion.

#n ay ', Pulak Chandan Prasad decided to strike it on his own and

started Nalanda Capital for making inestments in #ndia. *hanks to his

c)insey 6 ar$urg Pincus pedigree, he had no pro$lem attracting inestors

who pumped in 24 illion. He raised another 245m in "pril '%%.

7ortunately, he has lied up to the promise and has had an incredi$le track

record of finding multi$agger stocks and enriched Nalanda8s inestors.

Pulak Chandan Prasad makes it clear that when Nalanda Capital seeks to

inest in a stock, it su$(ects the company to the same rigorous screening

process that a priate e-uity inestor seeking to inest in an unlisted



company would do. *he criteria that a stock has to fulfill $efore Nalanda

makes an inestment are9

/i1 High return on capital9 *he company must hae a consistently high

return on capital $ecause return on capital is a ery good indicator of the-uality of the management team and the competitie adantage of the

$usiness.

/ii1 Attractive industry9 *he industry structure, the conduct and

performance of the companies therein is analy:ed to determine the long;

term prospects for alue creation.

/iii1 Quality management with good credentials9 *he entrepreneurs

must $e clean and transparent and hae an outstanding track record. "lso,

the management must $e open to external ideas, discussion and de$ate.

/i1 Risk-reward ratio must be in favour of the investment9

NALANDA CAPITAL’S SECRET FORMULA FOR FINDING WINNINGSTOCKS

- Invest only in top quality stocks with high ROE, good business model and ethical

management;

- Invest only after thorough research into all pros and cons !ever invest on an

impulse;

- "iversify into di#erent sectors to avoid risk;

- $refer %id-&ap and 'mall-&ap 'tocks instead of (arge-&ap stocks;

- )ave a concentrated portfolio of a few stocks that you can watch carefully;

- Invest for the long-term *he minimum holding period is + years;

- void anks . /inancial 'tocks

Now let8s take a look at Nalanda Capital8s latest portfolio and the rationale

for a few of those inestments9

Sr. Company Nos of % o!"#n$ CMP Rs. Cr&



No.sar's

!a(s&

0 M#n")r'' 1231 0044 55150

4 Pa$' In"*s)r#'s 0000 665 +2+

7 E+#"' In"*s)r#'s 15321 +14 +48

1 ,a-'!!s In"#a 5536 +46 162

+ 'r$'r Pa#n)s 08041 +47 135

5 AIA En$#n''r#n$ 2606 813 722

2 S*pr'm' In"*s)r#'s 8022 511 750

8 D Corp 04661 236 71841

6 Gr'a) Eas)'rn S#pp#n$ 03+41 562 73736

03 Car/or*n"*m Un#-'rsa! 40434 007 730

00 0a#/a- G!o/a! 1000 0483 47+

04 Tr#-'n# T*r/#n' 71565 03+4 026

07 Info E"$' In"#a 78+7 7+7 021

01 K#r!os(ar O#! En$#n's 03865 2+7 05283

0+ K'1a! K#ran C!o)#n$ 0433 621 077

05 02G*ar" In"*s)r#'s 4361 234 033

02Ra)naman# M')a!s an"

T*/'s0621 10+0 52

08 0o!)amp Transform'rs 05+7 0571 50

06 Tr#-'n# En$#n''r#n$ 4+288 0333 7+

43 NR 'ar#n$s 6587 666 77

40 Lo-a/!' L#n$'r#' 618 +51 45

44 A!*1a!#a Con)ra3)s In"#a 210+ 0084 06



47 C'ra San#)ary1ar' 405 020 05

To)a! 0a!*' Of Na!an"a Cap#)a!’s Por)fo!#o As Of 45.46.6748 9:7:.;<

Mindtree is Nalanda Capital8s single largest inestment. #t $ought a '<

stake in 7e$ruary '& and has $een steadily increasing its stake $y $uyingmore in '& and '%'. *he purchase price ranges from =s. '%' to =s. 4.

*he confidence in indtree is (ustified $ecause the stock has gien a return

of 5&5< since '&. *he stock is still a great $uy owing to its consistent

strong growth, strong deal pipeline, and reasona$le aluations /P>? of %@.&

7A %31.

Page Industries was $ought $y Nalanda Capital in Bcto$er '+ at the

price of =s. 45 per share. #t was one of the first large inestors in Page.

Page has $een a rocket stock, giing a return of %%&%< since Bcto$er '+.

#t continues to $e expensie /P>? 431 $ut continues to en(oy inestor

confidence owing to its strong $rands and high =B?s. #nterestingly, Nalanda

Capital also $ought a $ig stake in Loa$le Lingerie in uly '%3. Howeer,

Loa$le Lingerie has not gien great returns so far.

!ide Industries is a stock where Nalanda has lost money since it starting

$uying in arch '%%. Howeer, Nalanda has $een $uying steadily and

trying to aerage its purchase price. *he stock has $een pummeled $ecauseit reported poor results. Howeer, the stock appears to hae $ottomed out

and is ripe for an upmoe now. *his is a stock where the risk;reward ratio is

now in faour of a purchase.

Havells India was $ought $y Nalanda Capital in uly;0eptem$er '%% at an

aerage price of a$out 35 per share. "t that time Haells had $een

pummeled $ecause the 0ylania8s lighting $usiness was not doing well.

Howeer, Haell8s restructured its operations and the result is that the stock

price has nearly dou$led at =s. 5'. Haells is still a good $uy $ecause it

reported strong results in D'7A%4 with strong operating performance and

high ?!#E*" margins. Haells has guided for a reenue growth of %%;%'<

and ?!#E*" margins of %3;%4< in domestic $usiness. #t reported a =B? of

3'< in 7A '%3 and is trading at a P>? of '4.



"erger Paints has $een another multi$agger for Nalanda Capital. #t

increased its stake in "ug '& $y a preferential issue at the price of a$out

=s. 45. "t the CP of =s. ''4, Nalanda has gained a 4%&< appreciation on

its inestment. !erger Paints #ndia is the second largest paint company in

#ndia /the first $eing "sian Paints1. #t has a consistent track record of growth

and well known $rands. Howeer, the stock is not cheap and is trading at a

P>? ratio of a$out 3x 7A%4?.

AIA ngineering was $ought $y Nalanda Capital in 0eptem$er;Eecem$er

'%% at the price of a$out =s. 3% per share. *he stock has done -uite well

with a 45< return. Howeer, the good times are (ust starting for "#"

?ngineering. #t is a de$t free company and is engaged in the manufacture of

high;chrome grinding media for which there is a great demand. "#"

?ngineering plans to increase its high;chrome capacity $y @, tonnes in

7A%4 and %,+, tonnes in CA%5, resulting in %'< capacity expansion $y

7A%5. *here is a ery good report on "#" $y walit Fyas in the Economic

*imes.

#upreme Industries was $ought $y Nalanda Capital in "pril '% at the

price of a$out =s. &+ /ad(usted for split1. Nalanda has $een steadily

increasing its stake since then. *he stock has gien a return of 35< from

the first purchase. 0upreme #ndustries is an eergreen stock that is

renowned for its steady growth. #t is one of the fastest wealth creators fore-uity inestors as per otilal Bswal8s ealth Creator /'+;'%31 study. #t

is also amongst otilal Bswal8s $est midcap plays.

$" %orp, the pu$lication house, was $ought $y Nalanda Capital in une

'%' at the price of a$out =s. ' per share. #t increased its stake in

0eptem$er '%'. *he stock is a steady performer and has churned out a

return of a$out 35< since the first purchase. *he stock has done -uite well

in D'7A '%4 due to the spate of adertisements $y the political parties on

the ee of elections. !y the end of D37A'%4, E! Corp is expected to enter

!ihar $y launching the Patna edition. !ihar8s adertising market si:e is a$out

=s 4 crore. E! Corp8s aluations are -uite reasona$le at % times the **

?P0 of =s. %5.

http://economictimes.indiatimes.com/articleshow/27611546.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst






&reat astern #hipping was first $ought $y Nalanda Capital in uly;

0eptem$er '%' and it has $een steadily increasing its stake. Great ?astern

0hipping is suffering owing to the oersupply of tankers in the dry $ulk

segment. *here is also a slowdown in the glo$al oil demand and freight rates

are soft. Howeer, once the glo$al economy improes, Great ?astern

0hipping can $e expected to take off. Nalanda Capital pro$a$ly $ought the

stock $ecause it wanted a stake in the logistics sector.

'aibhav &lobal is a ery interesting case. *hough the stock has $een on

fire with a 53%< ABA return and a '@5< return in ' years, Nalanda Capital

has not seen those gains $ecause it inested in Bcto$er ' at the price of

=s. % to =s. '3. "fter that the stock got into serious trou$le and touched

a low of =s. %%. ar$urg Pincus, which had inested =s. '45 crore in

Fai$ha Glo$al sold its holding in arch '%% for =s. %+ crore and suffered a

loss of &'<. Howeer, Pulak Prasad and Nalanda Capital remained inested

and now hae a ' $agger to their credit.

nalanda capital

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