Views on Life & on Equity Investing

Wonder, Wealth & Abundance

Cargills Ceylon & CiC Holdings – Sri Lanka

with 16 comments

As you saw in the previous post Moat how every investor in Sri Lanka made 16X in just a decade by investing in index (unless he was foolish enough to short). Hand picking (more like weeding out a couple) of selected companies out of index would further bolster returns.

Below are a couple of pure -blooded companies that I am giving a skip to, on account of somewhat higher leverage/debt, rapid build up of assets recently and restructuring. The market share of these companies is somewhat similar to what would be in India if we combine three groups plus more, Godrej + Dabur + Emami, and some more. Roughly accounting for 5-7% of Sri Lanka’s GDP.

First  – http://cargillsceylon.com

Year of Establishment – 1844
Market Cap 1500 Crores INR / 250 Million USD
P/E ~20
Businesses – more than 20, in more than half of them where company has more than 70% market share. 

Retail – http://cargillsceylon.com/OurBusinesses/CargillsRetail.aspx (more than three retail chains, market leader in the country)
FMCG, FOOD, Dairy  – http://cargillsceylon.com/OurBusinesses/CQF.aspx where KFC franchise acquired in 2010 is growing by 40% and TGIF acquired this year ( More than 10 businesses)
Agri – http://cargillsceylon.com/OurBusinesses/AgriBusiness.aspx


Annual Reports – http://cargillsceylon.com/InvestorRelations/CorporateReports.aspx

Second – http://www.cic.lk

Year of establishment ~1960
Market Cap 200 Crores INR / 35 Million USD
P/E ~25
Businesses – more than 35, again company is leader in  half of them and needs to prune to increase profitability

Company represents the two biggest market leaders in the world. Biggest Paint company of the World ( Market Cap 20 Billion USD – AKZO NOBEL), Biggest Personal Care company ( Market Cap 300 Billion USD – JOHNSONS & JOHNSONS). For a context Unilever globally is around 120 Billion USD.

It is really ironical that I give a miss to above two world class companies; but continue to latch on to C grade stocks from India like Gulshan Polyols, Wim Plast where I did make 3X and 20X returns but uncertain about their future Awesome-ness and Majesty. In a future post I may write about what is worth buying in Sri Lanka with a 20X potential in a decade.
 


Written by amitdipsite

July 5, 2014 at 10:39 pm

Posted in Uncategorized

16 Responses

Subscribe to comments with RSS.

  1. Hi amit, can u pls provide the name of future multibaggrs of Indian STK most, this, shilesh

    hrithik

    hrithik

    July 7, 2014 at 9:18 pm

  2. Dear Hrithik

    If you read this post carefully

    http://multibaggersindia.blogspot.com/2013/06/multi-generational-investing-idea-1-and.html

    I removed the words “India” and words like “Multibagger” from the title of this blog. Also mentioned that “With this post I have erased India from the blog title. All you need is a handful of good investments for a successful investing career.”

    I hold many Indian stocks but not buying anymore. Not sure why those stocks have gone up 3-4-5 times this year. Nothing significant has happened to the companies like Superhouse, Wim Plast, Gulshan Polyols, Muthoot Capital, Kovai, Canfin Homes etc. All have tripled.

    If you want to be materially richer than you imagined to through the Multi Generational Ideas that I have posted, and ideas in Bangladesh and Sri Lanka etc. I am not buying in India anymore for the past 1-2 years as solid A class companies are available somewhere for same price as small caps are in. So, I’d rather waste 40 hours trying to do paperwork to open account to buy Glaxo than Invest in small caps.

    Thanks

    Amit Arora

    July 7, 2014 at 9:29 pm

  3. Cera Sanitaryware India – continue to hold since 60 Rs. Still looks great. Not much competition in the industry.

    Atul Auto India – Huge demand in rural and potential in other under developed countries for its unique product. Holding pre split since 80 Rs. Looks like it will deliver another 10 bagger in next 6-7 years.

    Amit Arora

    July 11, 2014 at 10:18 pm

  4. Hi amit,thanks a lot for giving multibagger names, I wanted to open an demat and trading account in Bangladesh and srilanka, as I am a normal Indian citizen is it legal to open an account in Bangladesh and srilanka, I had approached Hdfc bank and kotak bank in India they say they don't have that facility, please solve my doubts as I am very eager to move ahead in life, thanks again, shailesh

    hrithik

    July 12, 2014 at 10:08 pm

  5. what do you think about the following 11 small cap multibagger stocks.

    These are small cap stocks.
    I have created this list after looking thier last 10 quarters revenue and profit that is rising.
    I have also checked their return on equity and debt.
    I have also looked at their price graph.

    1) Poly Medicure ltd.
    2) Sharon Bio
    3) Manjushree tecno
    4) Alkyl amines
    5) Wonderla holidays
    6) Rs Software
    7) Kesar Terminals
    8) Natraj proteins
    9) Chaman lal setia
    10) Premco global
    11) Intec Capital

    Thanks

    Sonu

    July 14, 2014 at 4:17 pm

  6. Hello sir, as per your recommendation today I have purchased atul auto for long term, can u please provide your views on godrej properties, TV today, mother son sumi, liberty and nilkamal, I intend to hold them for 5 to 6 yes, please give your value able views, thank you shailesh

    hrithik

    July 14, 2014 at 5:12 pm

  7. really looking for it 20 bagger.
    Banks are charging $20 dollar TT routing charges to Sri Lanka bank. Do you have any other way to reduce the transfer cost?

    Karthikraja K

    July 22, 2014 at 6:23 am

  8. Amit,
    Sri Lanka is good for Tourism Industry. There are many Hotels & Travel industry operating and paying very good dividends. Pl share your thoughts.

    Karthikraja K

    July 31, 2014 at 6:54 am

  9. Karthik

    Have not checked hotels. Spent 80 hours last week reading dozens of annual reports for Sri Lankan market. Full of monopolies, larger player gobbling up smaller, nearly 10 large business groups control 60% of economy. Great for us as shareholders.

    Sri Lanka is fast becoming a middle income country – 4000 $ per capita.

    Hotel Industry is a bit dangerous, over investment leads to suffering by all players. They go bankrupt easily.

    Loved the reporting by some companies.

    DIMO is phenomenal ! cyclical industry though.

    Will share other ideas soon

    Amit Arora

    August 4, 2014 at 10:21 am

  10. I pay the same amount 20$

    Take heart, I also pay 58$ for courier to India, Sri Lanka and Bangladesh.

    This is called Ocean Investing – wider moat than moat. NZ Post has monopoly! like many counterparts in Sri Lanka. Great for investors bad for consumers.

    Amit Arora

    August 5, 2014 at 7:49 am

  11. Hi amit,you had recommended some excellent conviction stocks for us like ttk prestige and Hawkins, in that you had said its a life time opportunity I couldn't buy those as I livited your website some months recently, do you have the same conviction for delta Brac housing, please advise, thanks in advance, shailesh

    hrithik

    August 6, 2014 at 9:45 am

  12. I think the maximum growth was in Symphony, 200 times.

    I find it hard to correct myself as well in terms of not falling in love with stock. All of Bangladesh's financial institutions have 2% NNPA, Banks 5% NNPA. GNPA is higher. Delta Brac Housing – only 0.5%. Bangladesh is 20-25 years behind India, so can be a 70,000 Crores company in that time. RIght now only a 700 Crore company.

    It is my biggest holding right now, so biased.

    Amit Arora

    August 6, 2014 at 9:54 am

  13. Hi Amit,
    If I know it correctly you sold out of Symphony because mgmt was siphoning money ?

    Jatin

    August 9, 2014 at 5:02 am

  14. Yes buddy great memory!

    I got my parents to bring physical AR here.

    They were selling product on 100s of ecomnerce websites as a a new invention sort of thing. Story was strong.

    Check Dimo Lanka AR if you get time !

    Amit Arora

    August 9, 2014 at 3:04 pm

  15. Actually correction Delta Brac has 0.5% gnpa and 0% nnpa

    Amit Arora

    August 9, 2014 at 3:05 pm


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: