Buy BF Investment, target price Rs 803: HDFC Securities

HDFC Securities has buy call on BF Investment with a target price of Rs 803. The current market price of BF Investment is Rs 479.4 Time period given by analyst is 4 quarters when BF Investment price can reach defined target.

BF Investment, incorporated in the year 2009, is a Small Cap company (having a market cap of Rs 1789.21 Crore) operating in Holding Company sector.

BF Investment key Products/Revenue Segments include Income From Dividend, Interest Received and Income From Sale Of Share & Securities for the year ending 31-Mar-2022.


Financials
For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 13.68 Crore, up 204.81 % from last quarter Total Income of Rs 4.49 Crore and up 128.87 % from last year same quarter Total Income of Rs 5.98 Crore. Company has reported net profit after tax of Rs -4.30 Crore in latest quarter.

The company’s top management includes Mr.A B Kalyani, Mr.B S Mitkari, Mr.S G Joglekar, Mr.B B Hattarki, Mr.M U Takale, Ms.A A Sathe. Company has P G Bhagwat LLP as its auditors. As on 31-12-2022, the company has a total of 4 Crore shares outstanding.

Investment Rationale
Though the potential of value unlocking is large in case the promoters opt for delisting the shares, there is a possibility that the discovered price for delisting could be lower than the fair value. Conservatively, the brokerage has taken 40% of the fair value (~Rs. 642) as the base target and 50% of the fair value (~Rs. 803) as the bull case target.

Investors can buy the stock at in the band of Rs. 318 – 325 and add more on dips in the Rs. 275-280 band for base case target of Rs. 642 and bull case target of Rs 803 over the next 1 year.

Promoter/FII Holdings
Promoters held 74.13 per cent stake in the company as of 31-Dec-2022, while FIIs owned 1.26 per cent, DIIs 0.43 per cent.