Tuesday, June 27, 2017

Mid year update on Retail Holdings (RHDGF)

Seeking Alpha:

It’s been quite a run for our tip pick for 2017, Retail Holdings (OTCPK:RHDGF). Including a $2/share dividend, shares are up just under 50% since we named the company our top pick in December.


RHDGF’s NAV should continue to grow over time as the subsidiaries which make up RHDGF’s NAV continue to perform extremely well. For example, Singer Sri Lanka (~33% of NAV) reported Q1 company sales were up 5% while company EPS grew by almost 50%, only to be outdone by Singer Bangladesh (~47% of NAV), which reported Q1 sales and EPS were each up ~25%.

This is an excellent idea and I bought shares at the beginning of the year. I have also been following the subsidiaries and they are doing well. They basically sell consumer appliances in Bangladesh, Sri Lanka, and India. These are growing areas for consumer goods and I expect that the holdings could appreciate during the liquidation period which could lead to further gains to us shareholders.

There is a somewhat difficult to understand corporate structure for Retail Holdings but suffice to say the management has continued to reiterate it is going to liquidate these public holdings and return capital to shareholders.

I will be looking to add to my shareholdings and this should well as long as we do not have a psychotic break in the markets like 2008.

1 comment:

Rabina said...
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