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TIA 20-20 Ideas Summit
- Nitin Rao, Alpha Ideas
March 6, 2021
About Me
• Full Time Independent Investor
• Founder – Investment Blog called Alpha Ideas
• Market Maker in Unlisted Scrips
Disclaimer
• Not a SEBI Registered Advisor
• Presentation is only for Information Purposes
• Consult your financial advisor before taking any
investment decision
• I own the stock in my personal portfolio
• Have been wrong before. Can be wrong again
• Reserve the right to change my mind
Investment Philosophy
• View the markets as :
– Source of Wealth Creation
– Source of Income Generation
– Source of Endless Education
The Idea
Real Estate, seriously?
Why Now?
• Easy liquidity
• Low Interest Rates
• Refuge in hard assets
• Global Boom in Real Estate
Global Context
• US home prices are surging at fastest
pace on record
• China’s red hot property market is causing
the Govt to introduce cooling measures
• Same for Singapore
Indian Context
“Residential real-estate
sales have now surpassed
pre-COVID levels in most of
the large markets.
As per industry estimates,
sector-wise sales across
major cities in October to
December 2020 were 23%
higher than in the
January to March quarter
of 2020”
-Ajay Piramal, 11 Feb,
2021
Ek Tha Builder
NSE Realty Index
9
Year
Highs
BSE Realty Index
Crazy
Moves
The 3 Bet Criteria
• Bet on the Best Promoter
• Bet on the Leader
• Bet on Cheap Valuations
The Promoter – Jitu Virwani
Who’s He?
• Founder of the Embassy Group
• Built India’s first & largest REIT
• Owns India Franchise of WeWorks
• Darling of Institutional Investors
The Co – IB Real Estate
• Embassy Group Assets to merge with IB
Real Estate
• IBREL to be valued at Rs.92.5 per share
• CCI, SEBI,BSE & NSE already given
approvals
Post-Merger Shareholding Pattern
Promoter Classification
IN !!
OUT !!
A Giant is Born : 1/4
Source: Investor Presentation Jan 2021
A Giant is Born : 2/4
Source: Investor Presentation Jan 2021
A Giant is Born : 3/4
Source: Investor Presentation Jan 2021
A Giant is Born : 4/4
Source: Investor Presentation Jan 2021
Dirt Cheap Valuations
• Combined Entity Market Cap ~ 9500 Cr
• This is only 2.25 x annual rent potential
• Comparable peers trading at Market Caps
of 38,000 Cr – 75,000 Cr
Risks
• Merger may not happen or gets delayed
• False dawn of Real Estate Cycle
• Usual real estate risks related to
execution, project management, approvals
etc
The Last Word
“My whole idea is to grow one of the
largest real estate cos in the country
which I think is not a very difficult
job seeing the way other people
operate in the country.”
-Jitu Virwani, Oct 21,2020
Thank You
• Feedback/Queries: nitin.rao@alphaideas.in
• Blog: alphaideas.in
• Twitter: @alphaideas

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TIA Presentation

  • 1. TIA 20-20 Ideas Summit - Nitin Rao, Alpha Ideas March 6, 2021
  • 2. About Me • Full Time Independent Investor • Founder – Investment Blog called Alpha Ideas • Market Maker in Unlisted Scrips
  • 3. Disclaimer • Not a SEBI Registered Advisor • Presentation is only for Information Purposes • Consult your financial advisor before taking any investment decision • I own the stock in my personal portfolio • Have been wrong before. Can be wrong again • Reserve the right to change my mind
  • 4. Investment Philosophy • View the markets as : – Source of Wealth Creation – Source of Income Generation – Source of Endless Education
  • 7. Why Now? • Easy liquidity • Low Interest Rates • Refuge in hard assets • Global Boom in Real Estate
  • 8. Global Context • US home prices are surging at fastest pace on record • China’s red hot property market is causing the Govt to introduce cooling measures • Same for Singapore
  • 9. Indian Context “Residential real-estate sales have now surpassed pre-COVID levels in most of the large markets. As per industry estimates, sector-wise sales across major cities in October to December 2020 were 23% higher than in the January to March quarter of 2020” -Ajay Piramal, 11 Feb, 2021
  • 13. The 3 Bet Criteria • Bet on the Best Promoter • Bet on the Leader • Bet on Cheap Valuations
  • 14. The Promoter – Jitu Virwani
  • 15. Who’s He? • Founder of the Embassy Group • Built India’s first & largest REIT • Owns India Franchise of WeWorks • Darling of Institutional Investors
  • 16. The Co – IB Real Estate • Embassy Group Assets to merge with IB Real Estate • IBREL to be valued at Rs.92.5 per share • CCI, SEBI,BSE & NSE already given approvals
  • 19. A Giant is Born : 1/4 Source: Investor Presentation Jan 2021
  • 20. A Giant is Born : 2/4 Source: Investor Presentation Jan 2021
  • 21. A Giant is Born : 3/4 Source: Investor Presentation Jan 2021
  • 22. A Giant is Born : 4/4 Source: Investor Presentation Jan 2021
  • 23. Dirt Cheap Valuations • Combined Entity Market Cap ~ 9500 Cr • This is only 2.25 x annual rent potential • Comparable peers trading at Market Caps of 38,000 Cr – 75,000 Cr
  • 24. Risks • Merger may not happen or gets delayed • False dawn of Real Estate Cycle • Usual real estate risks related to execution, project management, approvals etc
  • 25. The Last Word “My whole idea is to grow one of the largest real estate cos in the country which I think is not a very difficult job seeing the way other people operate in the country.” -Jitu Virwani, Oct 21,2020
  • 26. Thank You • Feedback/Queries: nitin.rao@alphaideas.in • Blog: alphaideas.in • Twitter: @alphaideas