As you might be aware we look for both long term investment opportunities in stocks of high quality companies and Risk arbitrage/Special situation opportunities as temporary parking places for short term gains and yesterday we released one such Special situation opportunity for our premium Alpha +/Alpha + and Model Portfolio members.
This new Special situation opportunity is basically a play on substantial value unlocking in the company on account of triggers like:
Sale of certain loss making assets, and
Separation of various business units into standalone entities.
We basically believe that sale of loss making assets will make the company lean in terms of balance sheet, improve its profitability at both standalone and consolidated level and make it more focused on relatively higher margin businesses.
Further, separation of business units into standalone entities should result in overall re-rating at both the entities with aggregate market capitalization being much higher than what is currently commanded by the combined entity.
The good point about the above opportunity is that the triggers/catalysts are already present and is a time-bound opportunity to a large extent.
You too can get the detailed analysis on the opportunity and invest in it by subscribing to either of Alpha + or Alpha + and Model Portfolio in next few days. Register yourself HERE
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