ourkid8 Posted March 29, 2018 Posted March 29, 2018 https://www.fairfaxindia.ca/news/press-releases/press-release-details/2018/Fairfax-India-to-Acquire-Additional-6-Interest-in-Bangalore-International-Airport-Limited/default.aspx Fairfax acquired an additional 6% stake in BIAL and now they own a 54% interest.
dartmonkey Posted March 30, 2018 Posted March 30, 2018 By my reckoning, they have bought their 54% stake in 3 steps: 38% in March 2017 at an implied value of INR 65-67b (from GVK and Flughafen Zürich) 10% in July 2017 at INR 122-136b (from GVK) 6% in March 2018 at INR 67-80 (from Siemens) Last summer, I figured the value had somehow appreciared substantially in the 4 months since they purchased their initial stake, but now it seems they just paid more for that stake for some other reason, and are still able to get the same terms 12 months after the initial buy. Perhaps the value has appreciated but Siemens needed the cash? Or perhaps they overpaid last summer for some other strategic reason?
Spekulatius Posted March 31, 2018 Posted March 31, 2018 By my reckoning, they have bought their 54% stake in 3 steps: 38% in March 2017 at an implied value of INR 65-67b (from GVK and Flughafen Zürich) 10% in July 2017 at INR 122-136b (from GVK) 6% in March 2018 at INR 67-80 (from Siemens) Last summer, I figured the value had somehow appreciared substantially in the 4 months since they purchased their initial stake, but now it seems they just paid more for that stake for some other reason, and are still able to get the same terms 12 months after the initial buy. Perhaps the value has appreciated but Siemens needed the cash? Or perhaps they overpaid last summer for some other strategic reason? I highly doubt that Siemens needed a bit of change all of a sudden.
TwoCitiesCapital Posted April 3, 2018 Posted April 3, 2018 By my reckoning, they have bought their 54% stake in 3 steps: 38% in March 2017 at an implied value of INR 65-67b (from GVK and Flughafen Zürich) 10% in July 2017 at INR 122-136b (from GVK) 6% in March 2018 at INR 67-80 (from Siemens) Last summer, I figured the value had somehow appreciared substantially in the 4 months since they purchased their initial stake, but now it seems they just paid more for that stake for some other reason, and are still able to get the same terms 12 months after the initial buy. Perhaps the value has appreciated but Siemens needed the cash? Or perhaps they overpaid last summer for some other strategic reason? I can't find the source, but if my memory serves me correct, Watsa addressed the premium and suggested that in the long-term even that price would be a bargain and that it was purchased with long-term in mind. My guess is that they want to own as much of it as they can and they probably offered a substantial premium to get GVK to sell their minority interest. Not necessarily my type of investing, but they've proven themselves in India and they may be right about owning the airport at any price. Wish I could find the actual quote for you though :/
petec Posted April 3, 2018 Posted April 3, 2018 I can't find the source, but if my memory serves me correct, Watsa addressed the premium. It's in the Fairfax India 2018 letter. The second bloc was at a higher price because it enabled them to remake the board, name the CEO, and "generally to allow it to be managed according to Fairfax India's standards of corporate governance and guiding principles". The first bloc was at 8.7x FCF excluding the land bank so even the second bloc, at almost twice the price, was inexpensive.
FairFacts Posted April 3, 2018 Posted April 3, 2018 According to the press release last week, FIH is paying $67mil for the additional 6% of BIA. At 12/31/17 in their Shareholders letter they were holding 48% of BIA at a cost of $585mil and a MV of $608mil. If this is correct they picked up the 6% at a discount both to their12/31/17 cost and MV. Am I missing something?
petec Posted April 4, 2018 Posted April 4, 2018 See above. They paid a higher price for the bloc that enabled them to remake the board and name the CEO. So that has inflated YE17 average cost. I'm not sure what the MV is off the top of my head - it's not listed.
hobbit Posted April 9, 2018 Posted April 9, 2018 https://www.bloomberg.com/news/articles/2018-04-09/new-york-s-jfk-booted-out-of-world-s-top-20-busiest-airports wrt to india and bial...delhi is at 16 with 63 million passengers growing at 14% yoy... also below is a recent conversation where watsa discusses fairfax India..interesting insights into role of Deepak Parekh as well. https://www.youtube.com/watch?v=4XuBysRnGNc
alpha Posted April 9, 2018 Posted April 9, 2018 https://www.bloomberg.com/news/articles/2018-04-09/new-york-s-jfk-booted-out-of-world-s-top-20-busiest-airports wrt to india and bial...delhi is at 14 with 63 million passengers growing at 14% yoy... also below is a recent conversation where watsa discusses fairfax India..interesting insights into role of Deepak Parekh as well. https://www.youtube.com/watch?v=4XuBysRnGNc Great interview, thanks
hobbit Posted May 22, 2018 Posted May 22, 2018 Harsha Raghavan leaving https://globenewswire.com/news-release/2018/05/21/1509329/0/en/Fairfax-India-Executive-Announcement.html
Lakesider Posted July 29, 2018 Posted July 29, 2018 This has come back down to about P/B (31 march) of 1.1, Indian markets have recovered from the dip in since so todays PB likely even better. Keeping my eye on this thinking about adding more.
tradevestor Posted August 2, 2018 Posted August 2, 2018 As of June 30, 2018, common shareholders' equity was $13.26 per share. That sets the P/B at 1.22, with the current price of $16.12
Lakesider Posted August 2, 2018 Posted August 2, 2018 Thanks tradevestor, not sure why i was looking at march..
valueinvesting101 Posted August 9, 2018 Posted August 9, 2018 Kempegowda international airport sees 32.8% jump in passenger traffic Read more at: http://timesofindia.indiatimes.com/articleshow/65295980.cms KIA has also reported a record 98,869 passenger arrivals and departures on June 30, making it the busiest day since the airport commenced operations in 2008. KIA recorded a footfall of 26.9 million passengers in 2017-18. Domestic and international passengers grew by 35.8% and 16.8%, respectively, between April and June this year. As many as 6.94 million domestic flyers and 1.08 million international travellers passed through the airport. Fairfax India has paid for $653 million so far for 54% stake in the airport but currently carrying on the book at $643. I believe this significantly undervalues the airport which is growing at such a high rate and expected to grow with addition of new terminal and growth in Indian economy and especially Bangalore.
rohitc99 Posted August 9, 2018 Posted August 9, 2018 Kempegowda international airport sees 32.8% jump in passenger traffic Read more at: http://timesofindia.indiatimes.com/articleshow/65295980.cms KIA has also reported a record 98,869 passenger arrivals and departures on June 30, making it the busiest day since the airport commenced operations in 2008. KIA recorded a footfall of 26.9 million passengers in 2017-18. Domestic and international passengers grew by 35.8% and 16.8%, respectively, between April and June this year. As many as 6.94 million domestic flyers and 1.08 million international travellers passed through the airport. Fairfax India has paid for $653 million so far for 54% stake in the airport but currently carrying on the book at $643. I believe this significantly undervalues the airport which is growing at such a high rate and expected to grow with addition of new terminal and growth in Indian economy and especially Bangalore. also what gets missed is the land around the airport ..the pace at which the city is expanding (exploding is a better term), this land is going to be very valuable. air travel has become affordable for a very large segment of the population and its going to grow for some time
tradevestor Posted August 10, 2018 Posted August 10, 2018 BIAL annual report: http://www.bengaluruairport.com/bial/pdf/Annual_Report_2016_17.pdf (slow site, takes more than a minute to load)
obtuse_investor Posted September 5, 2018 Posted September 5, 2018 Still not at the lowest price to book value it has been at before. It's a good buy if you can convincingly argue that book value is understated. Book value is in US dollars, while earnings are in rupees. USDINR is hitting all time highs lately. Most likely that is not permanent, considering the long growth path the country has.
chrispy Posted September 10, 2018 Posted September 10, 2018 Since June 30th IIFL has decreased by 4-5%, Bangalore has not been reappraised (I believe), and the currency has plummeted. The q2 decrease in book value was due to the rupee so that would mean book value may very well decrease this quarter (short sighted thoughts)
petec Posted September 20, 2018 Posted September 20, 2018 Deal announced today values Sanmar at $1.5bn of which FIH will own 43%. BVPS rises by $1.62 although I don’t understand why they get to revalue the equity based on their own follow-on price.
chrispy Posted September 26, 2018 Posted September 26, 2018 Value Stocks podcast most recent episode covers Fairfax India for about 45 minutes. Enjoyed listening to it but the topics and conclusions are very similar to what has been mentioned here. My cost basis is right around this price level and is only a few percentage of my total holdings. I don't feel an urge to add unless it drops one or two more dollars which may not happen.
TwoCitiesCapital Posted September 26, 2018 Posted September 26, 2018 I've decided to dip my toes in here. It diversifies my major EM exposure and it has a clear track record. Still not ecstatic about the fee structure, but one does deserve to get paid for their talent... Small holding at the moment - ~0.5% but will likely be rolling other profits into it if it stays near current levels as other things run.
Fairfaxnut Posted September 27, 2018 Posted September 27, 2018 Brian Bradstreet is buying again.... https://www.canadianinsider.com/node/7?menu_tickersearch=FIH+%7C+Fairfax+India+Holdings
valueinvesting101 Posted September 29, 2018 Posted September 29, 2018 Brian Bradstreet is buying again.... https://www.canadianinsider.com/node/7?menu_tickersearch=FIH+%7C+Fairfax+India+Holdings What are those number for Fairfax India holding in July and August? Does it mean company repurchased and cancelled those shares?
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