Ajay Piramal (Piramal Group) is in advanced talks to buy US private equity firm TPG Capital's 20.27% stake in STFC, for around Rs 3,500 crs. Piramal is holding a lot of cash from his sale of his formulations business to Abott, and STFC stake gives him a foothold into one of the best financial intermediaries in India (in my opinion!).
Ajay Piramal is well-known for his business acumen and has a lot of followers in the value investing community. Hopefully, with this stake, there will be some focus on STFC. With the new roll out of auto malls, growth in the LCV and mini CV segments, STFC is likely to do fairly well. If CV financing picks up (a couple of years down the line), the profits would soar. The main reason I like STFC is that they have a very strong moat in their core business, which results in NIMs of 7-8% (double that of the best run banks like HDFC Bank).
With possibiliities of reduced interest rates in 2013, it may be a harbinger of good tidings for STFC.
Happy New Year & Happy Investing in 2013.
Ajay Piramal is well-known for his business acumen and has a lot of followers in the value investing community. Hopefully, with this stake, there will be some focus on STFC. With the new roll out of auto malls, growth in the LCV and mini CV segments, STFC is likely to do fairly well. If CV financing picks up (a couple of years down the line), the profits would soar. The main reason I like STFC is that they have a very strong moat in their core business, which results in NIMs of 7-8% (double that of the best run banks like HDFC Bank).
With possibiliities of reduced interest rates in 2013, it may be a harbinger of good tidings for STFC.
Happy New Year & Happy Investing in 2013.
