Jeffrey Stacey of Stacey Muirhead Capital Management updated his investment thesis on Fairfax India Holdings (Canada: FIH.U) at Best Ideas 2025.
Thesis summary:
Fairfax India (FIH) is an investment holding company whose objective is to achieve long-term capital appreciation by investing in public and private equity securities and debt instruments in India and Indian businesses.
Fairfax India sponsor Fairfax Financial Holdings has an excellent long-term record in India. The Fairfax India IPO was completed in January 2015. Fairfax Financial owns 43.4% and OMERS owns 15.1% of Fairfax India. The latter receives investment support from Fairbridge Capital in Mumbai. FIH reports financial results using IFRS investment entity accounting. As a result, book value per share is a “rough” proxy for intrinsic value.
FIH’s largest holding by far is the privately held Bangalore International Airport. It is India’s third-largest airport and one of the world’s fastest-growing airports, with a strategic position in southern India. The airport reported a record 37.5 million passengers and 439,524 MT of cargo in FY2024. Jeff views the recent published valuation of $2.5 Billion (on a 100% ownership basis) as extremely conservative.
FIH had book value per share of nearly $22 as of Q3 2024. Due to the conservative nature of management’s value estimates, Jeff believes fair value may be ~$10 per share higher, resulting in an adjusted fair value of roughly $32 per share. FIH recently traded at roughly one-half of this adjusted fair value estimate.
Since inception, FIH has repurchased 22 million shares, or 14% of total shares outstanding for $289 million or $13 per share.
View Jeff’s FIH presentations at Best Ideas 2022 and Best Ideas 2023.
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About the instructor:
Jeffrey Stacey is the founder of Stacey Muirhead Capital Management Ltd. and he has over 35 years of investment industry experience. Jeff has an Honours Bachelor of Business Administration degree from Wilfrid Laurier University and is a Chartered Financial Analyst.
Jeff has been involved in many charitable and board activities throughout his career. He has served on several investment committees including for two Canadian universities. In addition, he has served on the advisory boards for two university student managed investment funds.
Jeff is married and has two children. Personal interests include hiking, fitness, reading, travelling, and playing drums.
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