Vivek's Porfolio Thread

[Chins]

@vivek423

The core business of sourcing for UK and US retailers is an extraordinary business with current RoCE of 100% +

How’d you arrive at this figure? They’ve explained that the RoCE profile for the core business is around 60%, dragged down by the losses in Bangladesh and the venture fund. I estimate FY22 consolidated RoCE to be ~40%.

@vivek423

However, I have assigned a valuation of INR 4000 cr (INR 1550 stock price at a 1 year forward PE of 15) simply to have a big margin of safety for a business in transition

Thanks I think they’ll deliver 240-250 Cr. of PAT in FY22 itself, so you’ve been very conservative with pricing, and I understand you wanting a margin of safety. If RoCE improves to 40% and they continue to execute, I agree that this business deserves higher multiples.

If you’d like to share more of what you know, and potential anti thesis pointers you’ve studied, come join us at the PDS thread, it’ll be nice to hear from more investors.

PDS Limited - A platform for entrepreneurs

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