ICUMD

60% Cdn Banks 10% Cdn Rail 10% Fairfax India 5% Alibaba 5% Brookfield 5% Apple 5% Other bets

Fairfax India is a very different business from Fairfax. I actually don't own any Fairfax as it currently seems to be more fully valued. Was a steal in the 350s. Aside from management, the two have little in common. Fairfax India on the other hand, is deeply discounted in my estimation. I think the thinly traded shares are much more valuable than the market makes them out to be. I'm confident the value will be realized over time. Both BABA and Fairfax India are deep value plays on my books together totalling about 15% of my portfolio.

BABA Fairfax India

China GDP per capita is 12,000 USD vs India 2,200 USD. Basically India is where China was 15 yrs ago. Will be interesting to see how the next decade goes for India. A possible five fold increase in GDP per capita x 1 billion people = tremendous improvement in quality of life and economic productivity.

From those diagrams, China is still very well interconnected. Further, a made in USA mandate will likely stoke inflation. No easy choices.

A generous heap of BABA.

Seems like they would have generated about 160 M USD through the IIFL share sale. Prior to the sale, their equity stake was about 640 M. Not a bad way to raise capital IMO.

Completely agree. I prefer the option they have chosen since it seems to be shareholder friendly. Personally, it's improved my confidence in management. Share price seems to have moved nicely since.

The Performance fee being paid in cash will reduce cash liquidity for Fairfax India I presume this will impair FIH.U ability to enact share buybacks through the NCIB and acquire new companies. Do we know if FFH is buying FIH shares on the open market?

Any draw backs or advantages to shareholders of Fairfax India in the performance fee being paid in cash rather than shares? I guess we avoid dilution at these ridiculously discounted share prices!

I believe they have increased ownership to 54%. Otherwise you are correct. This is a great start. I don't know what loans they may have taken on to fund T2 development, but the profitability allows for them to develop and refine and develop businesses within the existing physical structure. Also, will hopefully attract investors for a planned IPO under Anchorage, marking to market this key asset.

BIAL Record Profits - 63.3 M USD 2023 yr end. Finally some outstanding news I've been eagerly waiting for. I guess Fairfax India does know how to run airports. https://www.moneycontrol.com/news/technology/bengaluru-airport-most-profitable-in-the-country-in-fy23-ahmedabad-incurs-highest-losses-11859721.html

Using Starlink at my home right now. Live in a border city in Canada. Had terrible internet service from Bell, wired, but apparently at the end of a stretch of copper wire. Would cut out multiple times a day and very slow. Starlink has been transformative. 50-80bps, always connected with no drops. No issues streaming video or having a smart connected home now. A life saver. Downsides? Having to mount a dish to the roof with an ugly wire coming down the wall into the basement. Cost is expensive at $150/mo cdn. The price of rural living I guess.

BIAL. Wondering if anyone knows whether they are collecting their promosed 16% return on aero fees and 100% of non aero fees as set out in their operating terms with the government? My understanding is that the Aero fees are regulated at 16%, and assured by changes to the User Development Fees (UDF) charged to each passenger and set out in each control period. Have not come across a clear update on this question.

With the bulk of Fairfax India's valuation tied up in BIAL, a private company, there is no way of knowing if we are or are not ahieving that 15% compounded return. BV is only an estimate. Value will be unlocked only if Anchorage goes public or there is a SIB and Fairfax offers a fair price per share. Having said that, the share price performance over the last year or so wasn't bad considering the markets. We were impaired due to COVID affecting air travel. Hopefully 2024 offers some opportunity for fair exit of those interested in pursuing other opportunities.

Good to hear everyone hates it. Perhaps I have a high risk tolerance. Also, I like cash flow. My avg price is $58 Cdn. First purchased in the COVID lows of 2020. It is now retesting those lows. I recently added heavily at $56 In brief, Canadian banks form a core in my levered portfolio. BNS presents a very attractive investment with PE less than 8, dividend yield of 7.5%. 200 yr history, and the third largest of the Canadian banks. It remains highly profitable. Currently, valued the lowest in over a decade on multiple valuation metrics. New management in place should make this a more efficient bank. So I think future is bright. Fair value is ~ $85. Maybe it takes 5 years, but I think it will be less.

BNS 45% of my portfolio.

Hopefully they offer a SIB in the next 6-8 months.

Interestingly, Canada has in its history a heavy hand dealing with separatists during the FLQ crisis in the 1970s. In fact, Pierre Trudeau himself invoked the war measures act to suspend civil liberties. https://en.wikipedia.org/wiki/Front_de_libération_du_Québec#:~:text=It was considered a terrorist,people and injured many more. Seems to me that even Western nations can also have autocratic tendencies from time to time. On the other hand, that's what I expect from any good leader. Be it Pierre Trudeau or Modi - using autocracy selectively to maintain the unity and stability of a nation. Broken nations are not peaceful ones, nor ones that are safe to invest in.

Agree mostly. Trudeau should be upholding these values as a leader. Obviously, his priorities are elsewhere.

Events like 911 and Air India come from terrorist organizations, rather than individuals. In the case of Air India, there is no debate that militant Khalistani's held responsibility. A lot of innocent people died including children. Nijjar was a leader of this group having this terrible past. Trudeau could have discussed the issue of Nijjar's assassination privately with Modi. Rather, in accusing India publically (whether guilty or not), Trudeau makes many concerning unspoken statements. Most unspoken of all, his signaling of Canada as a safe haven for 'freedom of expression' once you have a Canadian passport. What a perfect breeding ground for extremism and terrorism. In any case, I suspect Trudeau days as Prime Minister will be ending in short order. Hopefully idiocy will be replaced with diplomacy.

https://www.hindustantimes.com/india-news/hardeep-singh-nijjar-faked-marriage-to-get-canada-citizenship-in-1997-report-101695397465458-amp.html Interesting character for Trudeau to support and risk trade relations. If the above was true, seems like he should have been deported back to India. Still awaiting to hear the 'evidence' India committed a crime on Canadian soil. Wonder why the delay?

Fascinating accusations. Let's see how the drama teacher does in this game of chess. First play: publically accuse a foreign country of crimes with no evidence and show unequivocal public support for a militant separatist movement.

It will be interesting to see where some of these major airlines make there travel hubs. Air India potentially making BIAL home would be transformative. Appears that many stars are aligning with improved global perception and opportunity in India, high profile and successes of indians abroad and the chance to lift 1 billion people out of poverty. Let's see the development over the next year.

The SIBs for Fairfax India are interesting. 1. They run counter to the BV performance fee generating structure of Fairfax. (Ie. They derive less performance fees) 2. They have failed to close the discount to BV and share price thus far. 3. They require capital which can be used to fund other purchases, therefore an opportunity cost. Yet, they have bought back via the SIBs in substantial quantity. My read on this is that the goal is to ultimately take this FIH.U private. Aren't all these SIBs essentially doing just that in piecemeal? Alternatively, they want to support share price and close the discount to help raise funds in the future, perhaps via Anchorage. Most certainly, the final chapter in this story hasnt yet been written. Hopefully some interesting deals and developments will be coming down the pipeline.