Roshan Padamadan presented his in-depth investment thesis on Rallye (Paris: RAL) at European Investing Summit 2015.

Rallye common stock and bonds offer exposure to one of the largest food retailers in the food, the Casino Group, at double-digit yields. Casino runs over 14,500 stores and has a revenue of close to EUR 47 billion, and operates in eight countries. 40% of revenue is from France. It is the leader in Latin America and Brazil and Columbia, and second-largest in Thailand. French accounting rules allow for book value of Rallye’s 50+% equity investment in Casino to be held at stated value, as control premium is given due credit, without mark-to-market. Control started in 1998. Mr. Market and news media misunderstand the covenants on its bonds, and bank debt. With no real risk of a forced rights issue, the holding company maintains adequate liquidity to see it through a weakening cycle. Business risk exists (in France, in Brazil, in Thailand), but financial risk is overhyped.

About the instructor:

Roshan Padamadan is Fund Manager of Luminance Global Fund, which has a global unconstrained investment strategy, looking at special situations and deep value. Prior to launching Luminance in 2013, Roshan spent more than seven years with the HSBC Group, including more than three years with HSBC Asset Management, as a Product Specialist. He worked for the highly commended Offshore Indian Equity team which ran US$5+ billion from Singapore, including a US$100+ million award-winning India hedge fund. Roshan has earned an MBA in Management from Indian Institute of Management, Ahmedabad. He holds the CFA, FRM and CAIA charters and speaks over five languages.

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