15 May , 2024 By : Debdeep Gupta
Loss over profit
A bird in the bush is worth two in hand. That seems to be the approach of many small and high-networth individuals looking for potential multi-bagger stocks in the small-cap space. This is reminiscent of the startup bubble a few years back when investors would get excited by the cash burn of a company rather than its profitability. Loss-making TIL (formerly Tractors India Limited) saw a strong response to its Rs 50 crore rights issue, which got subscribed 2.15 times overall. Some of the HNIs who applied thinking it would be an all-you-can-eat buffet were disappointed to learn many others were thinking on similar lines.
The street is betting on a swift turnaround in the company’s fortunes following the recent change in management, though seasoned investors feel any meaningful revival could be a good 3-4 years away.
On the other hand, Sakuma Exports, a profit-making commodities trading firm with the moniker of desi Glencore, had to extend its right issue closing date following a tepid response.
Forging ahead
Shares of Bharat Forge continue to build on the gains made last week following a better-than-expected quarterly showing. The Silent Investor is said to have added to his positions in the stock recently. The street is divided on the valuations even as the demand outlook—domestic and international—has improved.
Not me
An unlisted semiconductor company has been creating a lot of buzz in HNI circles after it got the backing of the master blaster of Indian cricket. The extent of master blaster’s financial commitment is not known, but looks like efforts are on deck to get the company up for an IPO at the earliest by linking reputed value investors to it. One such PMS fund, the Pune-based Sadhu Number One, had to issue a categorical denial saying that while it had met up with the management last week, it had no plans to invest in the company for now.
Unlisted gunslinger
Mumbai-based value investor AK-47 is said to be snapping up stakes in unlisted firms, as he feels there are no good bargains in the listed space. The latest stock to have caught his fancy is the unlisted subsidiary of a Chennai-based listed battery maker. The subsidiary makes composites for railways and defense. AK-47 and two of his associates are said to be in talks to pick up a sizeable stake in this one.
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