Thread by @saurabhk_tweets

#RedingtonIndia - Distribution giant available at reasonable valuations. Buying Apple iPhone, HP laptop or Canon printer? All of these companies & over 100 others have entrusted Redington to be their distributor. Interested? - Let's dig deeper @SocInvestApp @MarketScientist (1/n)

Redington has established partnerships with more than 250 global brands spread across 37 emerging markets with network of 34,000 channel partners. It has tie ups with Apple, HP, Dell, Lenovo and Samsung contributing to 65%+ of revenue (2/n)

Leading market position in distribution of IT and mobility product – number 1 or 2 player in most of the geographies. Expect the company to be a direct beneficiary of increase in digital sales (PCs, Notebooks, Mobile Phones, Tablets etc). (3/n)

MOAT: (A) IT and Mobility product distribution is a low margin business with high working capital requirements – this acts as an entry barrier; (B) Strong relationship with the global brands and channel partners (4/n)

Financials: (A) Strong balance sheet – net cash position of INR 2,850 cr (as of March 31, 2021); (B) 12 month profit doubled in 2.5 years with ROCE of 20%+ & ROE of 15%+; (C) COVID driven digital growth led to bumper Q2FY22 results with PAT growing 70%+ on YoY basis (5/n)

Valuation: Currently trades at EV/EBITDA (TTM) ratio of 5.0x and P/E (TTM) ratio of 11.1x with dividend yield of 2.7% (6/n)

Overall view: Looks interesting for investment from a long term perspective and should be explored further by investors.

Detailed article:

socinvest.app/post/redington… (7/n)

Disclaimer: Analysis is purely for educational purpose and not to be construed as an investment advice. Please consult your financial advisor before acting on it (n/n)