Views on Life & on Equity Investing

Wonder, Wealth & Abundance

BERGER BANGLADESH – Long term investment

with 11 comments

Not going to waste much space or time. Company does not require much research.

Banks want to lend funds to people who are money-wise do not really need cash but just happen to, for an urgent requirement. Likewise, we need to buy companies that do not need to be listed on stock market, have adequate cash flow, but are because of a freak accident or first generation entrepreneur.

Berger Bangladesh was listed because of similar freak incident. 5% shares are listed on Dhaka Stock Exchange. Market cap 2300 Crores, PE 20, Growth 20-25%. 
CMP – 1000 BDT
Dividend – 22 BDT
Debt – 0
EPS for H1 = 27  BDT

Cash Flows – 180 Crores per annum, growing at 25% per annum

Competitive position is twice as strong as Asian Paints (35% market share in India ) in terms of market share – 60% market share in Bangladesh. Asian Paints sells at 52 PE, 6 times sales (no idea why? with 12-15% growth). Berger Bangladesh with better future and better past, current  and expected future growth rates sells at 20 PE and 2 times sales.

Tie up with 2nd biggest paint company in the world,  PPG
http://www.wpcia.org/news/World%27s%20Top%20ten%20Paints%20Companies%202013%20Annual%20Report.html

Also, another JV with Becker

http://www.beckers-group.com/en/News–media/News/2011/Joint-Venture-in-Bangladesh/

The only end result of holding this stock for long term can be phenomenal compounding, wealth creation and financial riches. Can be a 10-15 bagger+ in a decade with very high stability in all 
economic cycles, extremely attractive dividend payouts, will likely re-rate to 40+ PE eventually.

Don’t be fooled by the name Berger, in India it may have 17% market share but it is a monster, a 927 pound gorilla without any equal in Bangladesh.


http://www.dsebd.org/displayCompany.php?name=BERGERPBL

http://www.bergerbd.com/corporate_info/reports/Annual_and_Quarterly_Reports

Feel free to go crazy with your research.

Disclosure: Invested

Written by amitdipsite

August 6, 2014 at 10:09 am

Posted in Uncategorized

11 Responses

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  1. please write an article on how to invest in overseas stock markets

    STOCKS BEE

    August 6, 2014 at 4:40 pm

  2. Already answered numerous times, please see here:

    http://multibaggersindia.blogspot.com/2014/07/cargills-ceylon-cic-holdings-sri-lanka.html?showComment=1405212351034#c8855169630824779

    Rule of thumb, go to country stock exchange, email 20 brokers.

    All the best

    Amit Arora

    August 6, 2014 at 9:50 pm

  3. I get emails from people asking me for list of stocks. My answer after 5 years is same. Forget lists, find 1 good company to invest per annum to be supremely materially rich.

    On 21st August 2009 I wrote here http://www.theequitydesk.com/forum/forum_posts.asp?TID=2301&PN=3

    amitdip
    Senior Member
    Senior Member

    Joined: 28/Dec/2008
    Online Status: Offline
    Posts: 494

    Quote amitdip Replybullet Posted: 21/Aug/2009 at 8:18am

    I actually do not invest in more than 10-12 stocks that is why I had to pass Roto pumps.
    My exposure in Acrysil, Brescon, Cera Sanitary, Industrial and Prudential, Ador Fontech, Patels Airtemp is more than 5 -10% each.

    I believe that 1 good investment per year is enough to make you billionaire.

    Regards

    Amit Arora

    August 6, 2014 at 10:30 pm

  4. Hi amit, thanks a lot for your earlier replies,needed your views on fluidomat can it become the next atul auto, please give your views, thanks shailesh

    hrithik

    August 8, 2014 at 11:48 am

  5. Hi amit,can you give an rough idea regarding the returns one can expect in pastels air temp as you have included this company in your portfolio as you might have studied the company. Thanks, shailesh

    hrithik

    August 11, 2014 at 2:26 am

  6. Above is 2008 comment. I am only holding CERA now.

    Amit Arora

    August 11, 2014 at 4:37 am

  7. Hi amit,as I stay in India and I am an Indian resident, I visited Bangladesh stock exchange for more details I came across details regarding taxes, where it was given they charge 25 percent taxes for individuals, is that correct, so if I make a profit of 100 rupees I have to pay tax of rupees 25, am I correct, please clarify my doubts, shailesh

    hrithik

    August 11, 2014 at 5:27 pm

  8. 0% short term capital gains tax
    0% long term capital gains tax
    25% TDS on dividend

    If your share goes from 1 lac to 10 crores, no tax. Tax is only on
    Dividends received each year.

    Amit Arora

    August 15, 2014 at 3:42 pm

  9. Hi amit,thanks a lot for your reply, have a great weekend ahead, thanks shailesh

    hrithik

    August 15, 2014 at 7:09 pm

  10. I stand corrected, TAX on dividends in Bangladesh is only 10% and not 25%

    0% short term capital gains tax
    0% long term capital gains tax
    10% TDS on dividend

    Amit Arora

    September 1, 2014 at 9:01 am


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