Fairfax India new issue

[Hektor]

On 11/25/2025 at 12:14 PM, gfp said:

 

I'm not particularly worried about that risk.  I think Fairfax has a good relationship with Modi and India wants some diversification from their current stable of elite families that seem to own everything.

@gfp, I’ve been chewing on this for a couple of days now. Curious about why this risk is not a concern for you? 

[Junior R]

today I see buyer Morgan Stanley Canada Limited keep buying 

[SafetyinNumbers]

2 hours ago, Junior R said:

today I see buyer Morgan Stanley Canada Limited keep buying 

it’s a good day to buy it if the month end mark matters.

[CoGreenwich&Laight]

On 11/27/2025 at 4:57 PM, dartmonkey said:

Nice graph, and it shows that the biggest non-BIAL investments at Q3 end (IIFL FInance, CSB Bank, IIFL Capital) are all up 8-26%), whereas FIH itself is down 8%. The 2 that are down (5Paisa, Fairchem Organics) are tiny. 

 

Bought a little more today, which is crazy, because I already have way too much. Trading sardines.

likewise...all of the last few weeks in fact...

[CoGreenwich&Laight]

On 11/23/2025 at 3:59 PM, This2ShallPass said:

I agree, I don't think Prem will escalate this but if the meeting presents itself he will most likely bring it up. The govt officials probably don't realize how patient Fairfax can be.

 

The years long delay simply doesn't make sense to me. There must be some other reason, this is the best I could think of.

 

From my understanding, it is Anchorage that will go public, with all the BIAL equity. However the stakes from Siemens and a bit from earlier are outside of Anchorage. If i have this right, i wonder whats the process of valuation for injecting the non Anchorage BIAL stake into it, as the other valuations are seemingly 'stale' and 'low'.

[SafetyinNumbers]

13 minutes ago, CoGreenwich&Laight said:

From my understanding, it is Anchorage that will go public, with all the BIAL equity. However the stakes from Siemens and a bit from earlier are outside of Anchorage. If i have this right, i wonder whats the process of valuation for injecting the non Anchorage BIAL stake into it, as the other valuations are seemingly 'stale' and 'low'.

I’m not sure exactly what you mean. If Anchorage IPOs, they will use that valuation for the rest of the BIAL stake they own. They are also starting to mark up BIAL as the model price now exceeds what they paid Siemens. Generally for privates they use high discount rates and low terminal growth rates which is why valuations are low. It’s a good thing for long term holders as it defers fees but the returns don’t look as good.

[CoGreenwich&Laight]

5 hours ago, SafetyinNumbers said:

I’m not sure exactly what you mean. If Anchorage IPOs, they will use that valuation for the rest of the BIAL stake they own. They are also starting to mark up BIAL as the model price now exceeds what they paid Siemens. Generally for privates they use high discount rates and low terminal growth rates which is why valuations are low. It’s a good thing for long term holders as it defers fees but the returns don’t look as good.

BIAL stakes would be consolidated into Anchorage pre IPO is my understanding per PW comments this year. BIAL should be valued differently from Anchorage, as Anchorage is the vehicle for further infra transactions (airports ++).

[SafetyinNumbers]

2 hours ago, CoGreenwich&Laight said:

BIAL stakes would be consolidated into Anchorage pre IPO is my understanding per PW comments this year. BIAL should be valued differently from Anchorage, as Anchorage is the vehicle for further infra transactions (airports ++).

 Once there are other deals done sure but value can still be inferred. 

[gfp]

General article on Bloomberg about Adani airports investments.  Couldn't find the article for free yet so this is probably paywalled for those that don't subscribe to bloomberg.

 

gift link might work for the first few of you -

https://www.bloomberg.com/news/articles/2025-12-03/adani-group-plans-15-billion-india-airports-expansion-by-2030?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTc2NDcyMzYzMSwiZXhwIjoxNzY1MzI4NDMxLCJhcnRpY2xlSWQiOiJUNVlaOENHUTFZUTAwMCIsImJjb25uZWN0SWQiOiJDQzBDODMzNzNFQjM0MDk5QkQ3QTM2RkVBMTJDMTRFRCJ9.ikzatiScS38agObKKjFw0bUKUDYJB6ZPrqTQbTQmoEY

[Hektor]

12 hours ago, gfp said:

General article on Bloomberg about Adani airports investments.  Couldn't find the article for free yet so this is probably paywalled for those that don't subscribe to bloomberg.

 

gift link might work for the first few of you -

https://www.bloomberg.com/news/articles/2025-12-03/adani-group-plans-15-billion-india-airports-expansion-by-2030?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTc2NDcyMzYzMSwiZXhwIjoxNzY1MzI4NDMxLCJhcnRpY2xlSWQiOiJUNVlaOENHUTFZUTAwMCIsImJjb25uZWN0SWQiOiJDQzBDODMzNzNFQjM0MDk5QkQ3QTM2RkVBMTJDMTRFRCJ9.ikzatiScS38agObKKjFw0bUKUDYJB6ZPrqTQbTQmoEY

Thanks @gfp

[Alekbaylee]

From today’s edition of Gulf Times

[CoGreenwich&Laight]

On 12/6/2025 at 11:29 PM, Alekbaylee said:

From today’s edition of Gulf Times

Thanks. I'd much prefer that FIH buys back their own shares more aggressively than this co-investment with a minority stake as it will likely have to be given the price tag. Owning more airport/share is the best use of capital given the discount the shares trade at to NAV. Cant wait for this long drawn out hallucinant misadventure to fail for FIH...which has impaired their ability to buyback their own stock, and their political capital to execute on the Airport and related promises.

[Xerxes]

Prem has repeatedly mentioned that financials are the best assets to own in a growing economy. Believe he gave the example of Singapore. 
 

Why would we not want for FIH to take a big swing at these privatizations opportunities or other like assets. 
 

Buying back shares in an ocean that is full of opportunities (India) would be incredibly short sighted of them, and should be the very last resort. 

[villainx]

3 hours ago, CoGreenwich&Laight said:

than this co-investment with a minority stake as it will likely have to be given the price tag.

 

Feels like these kinda deals is something Fairfax is good at pulling off though.

[TwoCitiesCapital]

Yea, I'm ok with them deploying energy/capital/resources into the bank. 

 

I don't mind the exposure/diversification that will make FIH something other than a direct play on the airport - particularly once the airport IPOs then they'll be looking for other avenues of growth and capital deployment and I don't want them to pass on this simply because the timing is inconvenient. 3-4 of these large infrastructure investments is what I'm hoping for our do the long-term nature of the structure. 

[CoGreenwich&Laight]

On 12/9/2025 at 8:46 PM, Xerxes said:

Prem has repeatedly mentioned that financials are the best assets to own in a growing economy. Believe he gave the example of Singapore. 
 

Why would we not want for FIH to take a big swing at these privatizations opportunities or other like assets. 
 

Buying back shares in an ocean that is full of opportunities (India) would be incredibly short sighted of them, and should be the very last resort. 

Yes, they are quite excellent at marketing and waxing lyrical on investment philosophy. Lets look at the numbers. Its been 11 years now since launch. BVPS has compounded at 6.7%. If you mark the book up to $26 for addl' value to BIAL, the cagr is 9%. But one cant eat book value, the share price has compounded at 4.7%. Does that reflect 'ocean that is full of opportunities' seized? yes, the ocean is there, the fisherman is faulty. While shareholders have compounded at 4.7%, with no dividend, FIH shareholders have paid out $633 MILLION in fees (investment, advisory, and G&A), of which $561MM is to FFH. And further have paid out $244MM in interest, to hold a cash heavy balance sheet to pay fees on the cash balances. And all this to match an SOE heavy, large cap index they choose. That being aside 6.7% or 4.7% or 9% doesnt reflect a risk adjusted return to invest in India where the base rate for the most part has been at 7%, compared to just over 4% for the USA. It is what it is, they've bombed on their large investments Sanmar and NCML...at their preferred marked up price. BIAL can be a home run. Thats all they should own. So no, I vehemently disagree that they've seized the ocean of opportunity you refer to, and definitely havent earned their fees. I wont go into this more further till i hear the push back on the facts. The structure has failed therefore the 4.7% return to shareholders, the investments have failed if they are anything under 15% net, which is their target per PW. Just the facts through the fog of marketing and celebrity worship.

[CoGreenwich&Laight]

On 12/10/2025 at 12:01 PM, TwoCitiesCapital said:

Yea, I'm ok with them deploying energy/capital/resources into the bank. 

 

I don't mind the exposure/diversification that will make FIH something other than a direct play on the airport - particularly once the airport IPOs then they'll be looking for other avenues of growth and capital deployment and I don't want them to pass on this simply because the timing is inconvenient. 3-4 of these large infrastructure investments is what I'm hoping for our do the long-term nature of the structure. 

see my last comment for rationale on why they should not get it. Every $ invested is marked down 35% as shares trade at that discount or more. Its transparent to everyone that the airport is worth more, so the discount is greater...50%-70%perhaps. So take cash at 100% and mark it down by buying something else. Own the airport, more of the airport by buying shares, narrow the discount, its the bet thats bailed them out, while other material ones have failed and other minor ones dont matter.

[Hsmpanl]

1 hour ago, CoGreenwich&Laight said:

see my last comment for rationale on why they should not get it. Every $ invested is marked down 35% as shares trade at that discount or more. Its transparent to everyone that the airport is worth more, so the discount is greater...50%-70%perhaps. So take cash at 100% and mark it down by buying something else. Own the airport, more of the airport by buying shares, narrow the discount, its the bet thats bailed them out, while other material ones have failed and other minor ones dont matter.

How do you feel about Fairfax generally?

[SafetyinNumbers]

2 hours ago, CoGreenwich&Laight said:

Yes, they are quite excellent at marketing and waxing lyrical on investment philosophy. Let’s look at the numbers. It’s mtnbeen 11 years now since launch. BVPS has compounded at 6.7%. If you mark the book up to $26 for addl' value to BIAL, the cagr is 9%. But one cant eat book value, the share price has compounded at 4.7%. Does that reflect 'ocean that is full of opportunities' seized? yes, the ocean is there, the fisherman is faulty. While shareholders have compounded at 4.7%, with no dividend, FIH shareholders have paid out $633 MILLION in fees (investment, advisory, and G&A), of which $561MM is to FFH. And further have paid out $244MM in interest, to hold a cash heavy balance sheet to pay fees on the cash balances. And all this to match an SOE heavy, large cap index they choose. That being aside 6.7% or 4.7% or 9% doesnt reflect a risk adjusted return to invest in India where the base rate for the most part has been at 7%, compared to just over 4% for the USA. It is what it is, they've bombed on their large investments Sanmar and NCML...at their preferred marked up price. BIAL can be a home run. Thats all they should own. So no, I vehemently disagree that they've seized the ocean of opportunity you refer to, and definitely havent earned their fees. I wont go into this more further till i hear the push back on the facts. The structure has failed therefore the 4.7% return to shareholders, the investments have failed if they are anything under 15% net, which is their target per PW. Just the facts through the fog of marketing and celebrity worship.

I think intrinsic value is between $35-45. I think returns are pretty reasonable from a starting point of $9.50, after the IPO fees. They could be more aggressive with their marks and holders could have paid more fees up to the parent. The move from a premium to book to a discount to book has a lot to do with change in market structure. Management has taken advantage of it by buying back stock and I’m sure they will again when they have more liquidity. It’s not clear IDBI will take a big cash investment from FIH. They may contribute CSB at a premium and be the GP earning fees from LPs that are brought into the deal. 

[Hoodlum]

https://m.economictimes.com/industry/banking/finance/banking/fairfax-emerges-as-frontrunner-to-acquire-governmentlic-stake-in-idbi-bank/amp_articleshow/125919779.cms
 

Toronto-based Fairfax Financial is leading the race to acquire a controlling stake in IDBI Bank from the Centre and Life Insurance Corp of India (LIC) ahead of a December-end deadline for submission of financial bids for the lender, multiple people familiar with the matter told ET. Fairfax is competing with Kotak Mahindra Bank, the other significant contender in the fray, said the people cited above.
 

Fairfax Financial, founded by Indian-Canadian billionaire Prem Watsa, is said to be considering an all-cash offer in line with IDBI Bank’s current market value, according to those in the know. This could make it a favourite in the bidding process.

 

Kotak Mahindra Bank is said to be considering a bid in a combination of cash and shares, as per the people cited earlier. The submission of bids could spill over to early January. Emirates NBD which was also amongst those that had earlier submitted an expression of interest is re-assessing its participation in the final bidding round in light of its recently concluded agreement to buy a controlling stake in RBL Bank, as per people cited earlier.

[This2ShallPass]

14 hours ago, CoGreenwich&Laight said:

FIH shareholders have paid out $633 MILLION in fees (investment, advisory, and G&A), of which $561MM is to FFH. And further have paid out $244MM in interest, to hold a cash heavy balance sheet to pay fees on the cash balances.

I didn't factor in the interest payments! $877M in total fee / interest and let's see total value generated for the shareholder in 10 years, 974M. They have charged themselves 60% of what could be realized by the minority! Btw, this is ignoring the double whammy - they charged using BV and paid themselves in heavily discounted shares until the last round. 
 

[SafetyinNumbers]

2 hours ago, This2ShallPass said:

Btw, this is ignoring the double whammy - they charged using BV and paid themselves in heavily discounted shares until the last round. 
 

It was contractual they take the first two performance fees in stock. If I recall correctly, the first performance fee it was trading above book value, the second one was a big discount but it was tiny (~500k shares) and they bought almost 6x the shares issued for the performance fee back cheaper earlier in the year. You got the last round correct. 

[netcash1]

Should this help Fairfax increase its ownership in Go Digit by getting full credit for its Pref Interest 

 

India’s cabinet has approved a proposal to permit 100% foreign direct investment in the insurance sector, according to a government official. This decision aims to boost capital inflows and expand coverage in one of the world’s fastest-growing insurance markets.

The government had initially proposed removing the current 74% limit on foreign direct investment in the insurance sector in the federal budget for 2025-26. The proposal also included plans to review and simplify existing regulations and conditions governing foreign investment in the sector.

According to a Bloomberg report on Friday, the proposal will be introduced in parliament on Monday.

The removal of the FDI cap is expected to attract much-needed capital and global expertise to help expand insurance coverage in India. Government data shows that general insurance penetration in India was relatively low at 1% of GDP in 2023, compared with a global average of 4.2%.

This policy change aligns with New Delhi’s broader strategy to attract global investors as part of its push to finance infrastructure expansion and accelerate India’s transition towards becoming a developed economy by 2047.

[djokovic1]

16 hours ago, SafetyinNumbers said:

Management has taken advantage of it by buying back stock and I’m sure they will again when they have more liquidity.

 

Why do they need to wait for liquidity, i.e why don't they do a tender offer?

 

I ask because this is a common problem with UK companies. They bemoan their low valuation but rarely will do buybacks and argue that it will lower their liquidity instead of focusing on fundamental value creation.

Not saying it's the same situation here but more interested in understanding how they think about buybacks?

Edited December 12, 2025 by djokovic1

[SafetyinNumbers]

11 minutes ago, djokovic1 said:

 

Why do they need to wait for liquidity, i.e why don't they do a tender offer?

 

I ask because this is a common problem with UK companies. They bemoan their low valuation but rarely will do buybacks and argue that it will lower their liquidity instead of focusing on fundamental value creation.

Not saying it's the same situation here but more interested in understanding how they think about buybacks?

I was referring to liquidity at the holdco level to make more investments etc… That being said, most institutions complain that the shares aren’t liquid enough for them to establish a position and believe buybacks makes that worse.