Lalaram Singh of Vibrant Securities presented his in-depth investment thesis on KDDL Limited (India: KDDL) at Asian Investing Summit 2019.
KDDL is a tight niche export oriented precision engineering business. KDDL supplies watch components (hands and dials) to swiss brands. The company has a reported gross margin of 75%+. The company is part of a global exclusive club of five non-captive manufacturers of swiss watch hands. The company has also leveraged its manufacturing relationship with the swiss brands to venture into luxury watch retail. Today, KDDL is the top player, and the only pan India retailer of luxury watches. KDDL has retail sales of USD 75 million, with huge runway of future growth as per capital income of India rises leading to boom in discretionary expenditure. The catch is that in the wake of sharp market correction over the last one year and sharp depreciation of INR against USD – the market cap of this company has fallen from USD 100+ million (April 2018) to approximately USD 75 million today. The company can command a market cap of USD 300+ million in the next four to five years. It’s a very interesting business run by an “outsider” CEO.
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About the instructor:
Lalaram Singh is the CIO at Vibrant Securities, managing the proprietary book based on long only, value investing principles. Vibrant Securities is a 20+ year old stock broking company based out of Mumbai. At Vibrant, Lalaram is responsible for building the research team from scratch and formulating the investment strategy, idea generation and portfolio management process. Previously, Lalaram was the co-founder of AnalyseWise Investment Advisors, an Independent Equity Research company catering to retail, institutions and brokers. Lalaram was a part of AnalyseWise from Aug-14 to July-16. Prior to co-founding AnalyseWise , Lalaram was a part of 12 member team in Bain Capital at their Mumbai Office where he evaluated investment opportunities across industries ranging from Healthcare, IT, Industrials, & Consumer Goods. Lalaram began his career at J.P. Morgan in July-2012 upon completion of his Bachelors in Mechanical Engineering from Mumbai University. At J.P. Morgan, Lalaram supported the Asia M&A team working on companies across banking, insurance, securities and asset management in India, China and South East Asia.