Thursday, March 02, 2006

Companies that i would love to own - given a chance

I'm not a great fan of investing in IPO's . I would rather wait for the script to get listed and buy at a dip - most of the times at a price much below the IPO price. However, here are some of the companies that i would love to invest at the IPO stage itself. All are currently privately held.

1. Himalaya Healthcare

An ayurvedic/herbal healthcare products company, Himalaya has been an innovator since it's inception (Remember their Ayurvedic concept ads?). They have brought out a very distinct range of health care products backed by innovative and world class research. I have personaly used their products and am a very satisfied customer. I would rate them better than Dabur in thier ayurvedic product range and also in the quality of their products. Check out their web site here.

2. RKHS

A food /catering services company, i first came into contact with them at my clients place where they were running the company canteen. Later, i found them in Tidel IT park in Chennai too where they are running the food court.

Apart from running company canteens, RKHS also caters to oilfields and even to ships anchored offshore.

They are good at what they do and it is not easy to replicate their business model and economies of scale. Very impressive client list, captive clientele and high operating margins (must be - in the food court they charge 12 bucks for a small cup of lemon with soda !!). Group companies include Accor Radhakrishna (Ticket restaurant food coupons) and Unisol infraservices (facilities management).



3. Hidesign

Hidesign makes world class leather products like bags, jackets, belts and other accessories. I can personaly vouch for their quality - i bought a leather laptop bag from them 2 years back and it is still in excellent condition despite very rough use. Previously i used to run through bags from other brands at least once in 6 months or so!!

Hidesign is a fairly well known brand with their own exclusive shops in airports like Hongkong and Gothenburg.

Recently, i bought and carried 2 bags and 3 jackets from the Hidesign store in Chennai to South Africa for my South African collegues because the price difference between Chennai and South Africa (Hidesign has exclusive show rooms in upmarket malls in SA) for say a good laptop bag was something like 9000 rupees !!.

4. Subhiksha Discount Stores

A unique concept when it was started in Chennai, Subhiksha essentially is a discount grocery store and pharmacy. Thier USP is that you get all groceries (branded and unbranded) at atleast 10 % of the MRP. Same thing goes for medicines too.

I have been a faithful customer of Subhiksha for the past 4 years (though their service standards have come down sharply in the recent years). Basically, there is no "shopping experience" at a Subhiksha store - you carry your own bag (they do not give out plastic or paper bags), go to the counter and list out the stuff you need. The person at the counter picks up stuff you need as per the list and passes on to you with the bill. You cannot "browse" like in a regular super market.

This helps them to keep thier overheads low and pass on discounts given by manufacturers to the end customers.

Out of these four, Hidesign and Subhiksha may go in for IPO's this year. Subhiksha plans to expand in Maharashtra, Karnataka and AP. My advice? Invest - as long as the terms of the offer is not too much over the top.

4 comments:

abhigyan said...

Good to know ur likings,i think food buisness and herbal products buisness have a huge amount of margins.....i will appreciate if you can give some stock suggestions from one year time frame point of view......

Anonymous said...

Haldiram is also planning on an IPO.....!!!!!!!

Rajnath said...

Owning Hidesign could be an exciting venture…I love the leather products that they come up with..if you are a layman u wud think that Hidesign is som international fashion house ..but its not far away from home if ur an Indian!!! Its amazing how Hidesign has built its image..would like some1 to do a case study on them :)

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