Sid Choraria presented his in-depth investment thesis on Nesco (India: NSE) at Asian Investing Summit 2014.
Nesco: Significantly mispriced stock with investors getting a $50+ million cash pile and 70-acre land plot – near the Mumbai airport and likely worth ~2x recent market value – for free. The land was acquired in the late 1950s and is recorded at acquisition cost of US$1 million. Supporting the valuation is the core exhibition and IT park business, a wide-moat business with 75%+ EBIT margins and multiple growth catalysts. Insiders eat their own cooking and are good capital allocators. Nesco is underfollowed by most investors despite its transformation and recent improvements (exhibition and leasing capacity growth, margin expansion, cash pile increasing every year, dividends increasing every year). Screening databases like Bloomberg show incorrect P/E and P/B multiples.
About the instructor:
Sid Choraria is a bottom up, value investor focused on the small and mid cap companies in the Asia Pacific region, a region offering a fertile fishing ground for long-term value oriented investors. Sid was a Finalist in the 2nd Annual Value Investing Challenge hosted by the VIC and the only finalist from Asia. Prior to Marwar, Sid worked at Goldman Sachs in the Tech, Media and Telecom Group in Hong Kong. Prior to joining Goldman Sachs, Sid worked as a buy-side analyst at Bandera Partners, a value-oriented, special situations hedge fund in New York performing extensive bottom-up, fundamental research and financial analysis, with focus on downside risk and asymmetric payoffs. Previously, Sid had stints at Morgan Stanley and Merrill Lynch in Hong Kong and New York. Sid received his MBA from New York University Stern School of Business where he was a Harvey Beker Scholar and a member of the Value Fund within the Michael Price Investment Fund, a fund part of the NYU endowment. Sid completed the Value Investing course taught by Professor Greenwald at Columbia Business School’s Executive MBA program.
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