Recently we released our new Investment idea for all our premium members (Alpha/Alpha +) and would like to share with you details on the same.
Our latest pick is a Young, small-size company, founded by a first generation entrepreneur and growing by leaps and bounds.
We like companies which don’t need much capital for growth, yet still have huge opportunities for growth ahead of them. Our latest stock idea belongs to the same category because the company follows an asset light model with primary focus on partnering with the right vendors and expanding geographically so as to deliver services to its clients in the most efficient manner.
Over the years the company has expanded its scope of operations and now provides end-to-end solution to its clients. Thus, its clients are now able to outsource their requirements while focusing on their core operations.
What we like about the company is the fact that the sector in which operates is still young and there’s huge scope for its penetration to improve over the years. In fact, as per one of the reports of CRISIL, it expects the sector to record 19-20% CAGR over the next few years. So, when the segment itself is expected to record 20% CAGR, we believe with the right execution the company can grow much faster.
So, considering the fact that capital is not much of a constraint, huge opportunity size, young team with first generation entrepreneur leading the pack and reasonable valuations of around 11.8 times trailing twelve months pre-tax earnings, we believe there’s a strong possibility of decent gains from the stock over the next 3-4 years and probably even more.
In case you missed out on several high quality and high yielding stocks of the past (check the performance HERE), you can get your hands on Latest stock pick and make the most of it by subscribing to either of Alpha or Alpha +
Register yourself HERE On subscribing to Alpha + you will get access to active Special situation opportunities as well.
Few important points about the latest Stock Investment idea
The company has a decent track record of operating performance and has reported more than 20% CAGR in sales in the last 5 years; while the profits have recorded more than 30% CAGR.
On the front of margins, the company’s EBITDA margins have improved by around 100 bps in the last 5-6 years. Company has recently entered certain high margin segments and looking to further tap into other higher margin segments.
While the company has been recording decent growth in sales, it has managed to do so without taking on much debt. In fact, on net basis the company is almost debt free.
The company has consistently been recording 20% + ROAE
Promoters haven’t shown any propensity of diluting equity and hold very high stake in the company; thus expected to safeguard the interests of minority shareholders as well.
The stock is trading at attractive price from the valuations view point.
In case you missed out on several high quality and high yielding stocks of the past (check the performance HERE), you can get your hands on Latest stock pick and make the most of it by subscribing to either of Alpha or Alpha +
Register yourself HERE On subscribing to Alpha + you will get access to active Special situation opportunities as well
Disclaimer: This is not an investment advice. The performance data quoted at www.katalystwealth.com represents past performance and does not guarantee future results.
Best Regards,
Ekansh Mittal
Research Analyst
https://www.katalystwealth.com/
Ph.: +91-727-5050062, Mob: +91-9818866676
Email: [email protected]