Multi generational investing Idea #3 with two sidekicks
Idea is Unilever Nepal, an 80% subsidiary of Unilever India. I don’t believe it deserves much research.
Needless to say, company dons all the insane numbers that unleashes torrential bliss for an equity analyst; 100%+ ROE, market leader, 90% dividend payout, wide and increasing competitive position, deep product line, revenue and profit growth etc.
Current Market Price: 10,200 Nepal Rs.
EPS: 903 Rs
Dividend: 760 Rs
Face Value: 100 Rs.
Market Cap: 900 Crores Nepal Rs, less than 100 million USD.
Dividend yield: 8%
# of shares: 9,20,000 out of which 80% are held by parent, another 10-15% captured by tightwad hoarders, sorry, long-term-investors.
Ultimate Parent’s market cap 110 Billion USD.
Nepal’s per capita income is 1/3rd that of India.
Unilever Nepal has already been 100 bagger over the past 15 years, I am expecting another 200-500 bags over next 30 years, assuming man is not extinguished along with his atomic fate.
Good thing, stock does not show up on any stock-screener because foreign investment is not allowed as yet, investment can be done through Nepal Citizen alone.
|Year||Revenues||Net Profits Crores *||# of Shares**||Earning Per Share *||* In Nepal Rs|
|2002||6.75||920,700||73||** Face Value 100 Nepal Rs (Hindustan Unilever owns 80%)|
|2003||Growth 25%||4.25||920,700||46.28||40 Rs Dividend|
|2007||23.81||920,700||259||220+ Rs Dividend|
|2008||145||26.3||920,700||286||250+ Rs Dividend|
|2009||214||33.5||920,700||364||300+ Rs Dividend|
|2010||290||51||920,700||555||350+ Rs Dividend|
|2011||337||61||920,700||664||400+ Rs Dividend|
|2012||420||70.26||920,700||763||680 Rs Dividend|
|2013||472.47||83.13||920,700||903||760 Rs Dividend|
Sidekick A) Museum Grevin
Every seasoned investor knows traits of a solid company. While one may have to trade off, growth for price, or dividend for yet another dimension. For long term investing, the market position should also be unassailable. eg: India Gate, if it had ticket entry and were a listed entity.
Warren Buffet’s Quote to prospective sellers of fine businesses:
“You can sell it to Berkshire, and we’ll put it in the Metropolitan Museum; it’ll have a wing all by itself; it’ll be there forever,” he says at the February meeting. “Or you can sell it to some porn shop operator, and he’ll take the painting and he’ll make the boobs a little bigger and he’ll stick it up in the window, and some other guy will come along in a raincoat, and he’ll buy it.”
Sidekick B) Pepsi Cola Philippines
At 3000 Crores INR market cap, 20PE multiple, 18-20% growth looks reasonable for a great brand. Stock has already tripled in the past two years.
Philippines is the 12th most populous country and 300 Bn USD GDP. Country has similar prospects of development as other emerging countries such as India.
Good luck getting rich !
Disclosure: Invested in Unilever Nepal, not invested in two consorts yet