Country Club Hospitality and Holidays(CCHH) is in the business of Holiday packages-both national and international, Events and parties, Clubs and resorts and Fitness centers. Established in 1989, the company owns over 50 hospitality properties India, Middle East, Thailand and Sri Lanka. Venturing into fitness vertical recently, it has 25 exclusive member fitness centers.
For more info check,
http://www.countryclubindia.net/
http://blog.countryclubindia.net/
http://events.countryclubindia.net/
NUMBERS - THE LATEST
Market cap: 180 crores CMP on Day15 Aug2015: Rs 11.00 BV: 60 rs.(approx)
Revenue FY14: 495 cr Net profit FY14: 17 cr FV: 2
POSITIVES - MULTIBAGGER POTENTIAL
1. Country Club has resorts spread across India. They target the new middle class, the aspiration class. Their packages are mostly targeted at families, and that too young families across large indian cities. Their potential target customers are the fastest growing segment in the indian middle class in terms of consumption.
2. Most of their properties were acquired before 8 - 10 years, and due to the massive urbanization, what was once outskirts, is not well within city limits, and hence their clubs and resorts are easily reachable and approachable.
3. Founded by Mr. Rajeev Reddy who established the first level of growth, the company is now led by his children, Siddharth Reddy as the CEO and US-based Varun Reddy as the COO.
4. The marketing team of the CCHH is very dynamic and their marketing strategies are quite aggressive, and it comes as no surprise that they have over 4 lakh members.
INTERESTING INFO
1. At 22 years, Siddharth Reddy is one of the youngest CEO in Corporate India. Under such a young CEO, the company has great potential to make big strides in the near future, and establish itself firmly in the market.
2. COO Varun Reddy has done a double major in Economics and Communication from Rutgers University in the US; and hence has capability to bring in modern management and professionalism into practice
3. The biggest competitor of CCHH is Mahindra Holidays, how ever they seem to be in a much higher class and catering more to the elite, as the price differential between their packages is quite substantial.
4. In the last 6 months, at least 4 people personally known to me have become members of Country Club; and from the internet blogs, people who have visited and experienced the resorts seem to be happy.
NEGATIVES - POSSIBLE RISKS
1. There have been several negative reviews on the internet about the poor customer service of this company. At times, people find it difficult to even contact them over phone. The company is aware of this. They need to take concrete steps to improve customer service and manage the expectations.
2. There have been some corporate governance issues in the past. Probably that is the reason the stock is beaten down so badly. How ever, since last few years, they have been running a reasonably clean business, and are trying to improve on professionalism.
MY TAKE
There are several ways to identify if a company is undervalued. Especially if you want to find potential multibaggers, it is more of an ART than science. By following bookish formulas and ratios and excel sheets, it is very hard to find companies that can give multibagging profits.
The book value of the properties owned by Country Club across India and overseas, is in the range of 1200 crores. The market price could be much higher. The debts on the books is around 400 crores. So from a bird's eye view, it is quite obvious that this company is worth more than 800 crores at the least.
Today this company is available at a market cap of less than 200 crores.
Along with this, we have a business that is known for its aggressive marketing and is signing up members in good numbers, as we speak. As the competition in this space is limited, and entry barriers to new companies are very high, due to unavailability of land, and exorbitant real estate prices, this company has a fantastic future prospects.
A high potential multibagger!!
Disclosure: I own shares in Country Club.
For consultation(commercial) and JV ideas;
you can contact me via zorbayogi9@gmail.com
Important Note: Potential multibaggers are those stock which have potential to give 200 - 1000% profits. Obviously such returns take time. Probably 3 - 4 years or more. Short term volatality is the reality of the stock market and that will always happen. Short term movements(upside and downside) are impossible to predict. Only invest funds that you will not need for the next 3 - 4 years. As long as you buy a stock for the right reason and are convinced about the future prospects of the company, there is no need to worry if the share price goes down and stays down for a period of time after you buy; provided you have followed the cardinal stock market mantra BUY LOW.
Very important note: The objective of this blog is to share knowledge and info about multibagger ideas/opportunities. Neither is this trading website nor an analyst website nor a Buy/Sell call website. For stock market success, always do your home work, own analysis and make your own decisions.
For more info check,
http://www.countryclubindia.net/
http://blog.countryclubindia.net/
http://events.countryclubindia.net/
NUMBERS - THE LATEST
Market cap: 180 crores CMP on Day15 Aug2015: Rs 11.00 BV: 60 rs.(approx)
Revenue FY14: 495 cr Net profit FY14: 17 cr FV: 2
POSITIVES - MULTIBAGGER POTENTIAL
1. Country Club has resorts spread across India. They target the new middle class, the aspiration class. Their packages are mostly targeted at families, and that too young families across large indian cities. Their potential target customers are the fastest growing segment in the indian middle class in terms of consumption.
2. Most of their properties were acquired before 8 - 10 years, and due to the massive urbanization, what was once outskirts, is not well within city limits, and hence their clubs and resorts are easily reachable and approachable.
3. Founded by Mr. Rajeev Reddy who established the first level of growth, the company is now led by his children, Siddharth Reddy as the CEO and US-based Varun Reddy as the COO.
4. The marketing team of the CCHH is very dynamic and their marketing strategies are quite aggressive, and it comes as no surprise that they have over 4 lakh members.
INTERESTING INFO
1. At 22 years, Siddharth Reddy is one of the youngest CEO in Corporate India. Under such a young CEO, the company has great potential to make big strides in the near future, and establish itself firmly in the market.
2. COO Varun Reddy has done a double major in Economics and Communication from Rutgers University in the US; and hence has capability to bring in modern management and professionalism into practice
3. The biggest competitor of CCHH is Mahindra Holidays, how ever they seem to be in a much higher class and catering more to the elite, as the price differential between their packages is quite substantial.
4. In the last 6 months, at least 4 people personally known to me have become members of Country Club; and from the internet blogs, people who have visited and experienced the resorts seem to be happy.
NEGATIVES - POSSIBLE RISKS
1. There have been several negative reviews on the internet about the poor customer service of this company. At times, people find it difficult to even contact them over phone. The company is aware of this. They need to take concrete steps to improve customer service and manage the expectations.
2. There have been some corporate governance issues in the past. Probably that is the reason the stock is beaten down so badly. How ever, since last few years, they have been running a reasonably clean business, and are trying to improve on professionalism.
MY TAKE
There are several ways to identify if a company is undervalued. Especially if you want to find potential multibaggers, it is more of an ART than science. By following bookish formulas and ratios and excel sheets, it is very hard to find companies that can give multibagging profits.
The book value of the properties owned by Country Club across India and overseas, is in the range of 1200 crores. The market price could be much higher. The debts on the books is around 400 crores. So from a bird's eye view, it is quite obvious that this company is worth more than 800 crores at the least.
Today this company is available at a market cap of less than 200 crores.
Along with this, we have a business that is known for its aggressive marketing and is signing up members in good numbers, as we speak. As the competition in this space is limited, and entry barriers to new companies are very high, due to unavailability of land, and exorbitant real estate prices, this company has a fantastic future prospects.
A high potential multibagger!!
Disclosure: I own shares in Country Club.
For consultation(commercial) and JV ideas;
you can contact me via zorbayogi9@gmail.com
Important Note: Potential multibaggers are those stock which have potential to give 200 - 1000% profits. Obviously such returns take time. Probably 3 - 4 years or more. Short term volatality is the reality of the stock market and that will always happen. Short term movements(upside and downside) are impossible to predict. Only invest funds that you will not need for the next 3 - 4 years. As long as you buy a stock for the right reason and are convinced about the future prospects of the company, there is no need to worry if the share price goes down and stays down for a period of time after you buy; provided you have followed the cardinal stock market mantra BUY LOW.
Very important note: The objective of this blog is to share knowledge and info about multibagger ideas/opportunities. Neither is this trading website nor an analyst website nor a Buy/Sell call website. For stock market success, always do your home work, own analysis and make your own decisions.
