Wait & Hope - Rewards will be worth it !

 "All human wisdom is summed up in two words; wait and hope.' - Alexandre Dumas

This saying seems apt for the Indian markets as the 18 month long corrective phase which started in September 2024 continues. Post Modi led NDA coming back to power in June 2024 the markets have not had it easy both from a capital market policy & performance standpoint. Higher taxes on buyback & dividend, increasing STT & increasing capital gains tax has impacted return expectations of FIIs thus seeing steady drawdowns. 

In addition to this 2025 was a volatile year from a global perspective for India. India-Pakistan engaged in a brief war, Trump imposed harsh tariffs, Indian rupee depreciated sharply & emergence of AI is threatening Indian IT like never before. US-Iran conflict has escalated affecting the Middle East in an unprecedented manner with a new narrative on both escalation & de-escalation being created by the hour both by the media & a loud mouthed US president.

Indian economy is dealing with high crude prices, weakening currency, unprecedented FII outflow & a rising GSec yield. While we can incessantly ramble on the macro & conjure statistics to prove one thing or the other but the only thing of relevance is to find opportunities that have corrected beyond logic & business impact is minimal. 

Raymond Realty(CMP 400, Market Cap ~2,600 crores)

Raymond demerged its real estate division which got listed at ~ Rs. 1000 in July 2025. They are amongst the top 5 developers in MMR region.

• The company has 100 acres of land in Thane & is steadily developing the same with total revenue potential of 25000 crores at current prices. They have already sold inventory worth ~8500 crores & collected ~7000 crores. Delivery has been before schedule & tremendous goodwill amongst residents/ brokers has been created thus sales traction for ongoing projects/ launches is strong. 
• The company has done 6 JDAs with revenue potential of 14000 crores. 4 have been launched across Bandra, Wadala & Sion with two more launches expected in 12-15 months. 
• The company is expecting a quarterly revenue run rate of ~1000 crores & expects EBITDA margin to be in the 15-20% range. Net debt is at ~200 crores thus we can expect this company to generate cash of 500-600 crores per annum assuming no growth. Management is guiding for 20% growth.      

TATA Motors PV(CMP 305, Market Cap ~110,000 crores)

Tata Motors PV is the demerged passenger vehicle arm of Tata Motors housing the JLR business & the Indian PV business. 

The Indian PV business is India's second largest outpacing Hyundai & Mahindra. Hyundai's growth has flattened while Tata & Mahindra grow at 25-30% in the domestic business. Mahindra is a complex entity housing multiple businesses thus comparison of market caps becomes tricky but Hyundai houses just the India operations both domestic & exports. Hyundai's market cap is at ~140000 crores thus implying that the market is attributing no value to the JLR business.

JLR is a global behemoth which sells over 400,000 does a turnover of ~400000 crores & generates a PAT of ~20,000 crores with OCF of ~50,000 crores. The business faced a major hacking incident which led to two months of plant shutdown which disrupted the UK economy. The plant is almost on track although a week long shutdown is underway due to a fire at a suppliers factory thus halting production in the UK plant. 

However a business of this size which owns the cult brand Land Rover/ Range Rover & is pivotal to the UK economy is being valued negatively. In our opinion this anomaly will correct soon & the business will be valued at .5-1x sales in FY 27.

Aditya Birla Money (CMP 110, Market Cap ~600 crores)

AB Capital's subsidiary AB Money is the broking & wealth management arm of the group. The optionality's that this business enjoys in high & they have been showing significant growth on all counts. The company has put in place its digital architecture & leveraged the Aditya Birla brand to spread its physical reach to 70 branches and ~1000 franchise outlets. The DP assets stand at 75000 crores & a client base of 9 Lakhs.   

FY27 expected revenues to be close to ~500 crores & PAT of close to 100 crores. No rerating has taken place & growth has been in line with earnings so far. The potential to scale this business is very high as distribution of products, broking & even new avenues as commodities start on the platform. 

The stock has corrected more than 60% from its all time high & the broking industry has seen reduced volumes due to regulatory change. However the growing market share trajectory holds this business in good stead.