Ashish Kacholia portfolio: Why the Big Whale just bet big on two freshly listed SME stocks

Ashish Kacholia rarely chases noise. The Mumbai-based founder of Lucky Securities, often called the Big Whale of Dalal Street, has built his reputation by walking into rooms others have not yet entered. When he buys, the small-cap world listens. His March quarter filings have given the market two new names to look into.

Exchange disclosures show Kacholia has picked up fresh stakes in a Bengaluru-based loan aggregation platform that listed on NSE SME in November 2025, and an Ahmedabad-based maker of electrical and power distribution products that listed on BSE SME in January 2026. Together, the two positions add up to roughly 15.83 lakh shares and close to Rs 26 cr.

Both are SME counters. Both are small. Both are barely months old as listed entities. Yet both fit a pattern Kacholia has followed for years, which is owning small businesses with scalable models, clean balance sheets and operating moats that take time to show up on a screen.

So, what makes them worth Rs 26 cr of conviction? Let us dive into the stocks.

Finbud Financial Services: Scaling a 36% Topline Growth Without Credit Risk

Incorporated on July 9, 2012, Finbud Financial Services Ltd, better known by its consumer brand Finance Buddha, is a retail loan aggregation platform headquartered in Bengaluru. The company connects individuals and small businesses with banks and NBFCs for personal, business, home loans and loans against property. It also owns LTCV Credit Pvt Ltd, a wholly owned NBFC subsidiary registered with the RBI.

With a current market cap of around Rs 175 cr and a presence across 19,000 pincodes through a hybrid agent-and-digital model, Finbud sits in an interesting corner of India’s fintech map. It does not lend off its own balance sheet, so it carries no credit risk. It earns commission for every loan it helps disburse. The model is asset-light by design.

Kacholia first showed up at the IPO stage. Through Bengal Finance and Investment, he came in as the largest anchor investor with about Rs 7.17 cr at Rs 142 per share. The MS Dhoni Family Office and Bandhan Small Cap Fund were also part of the same anchor book, a rare instance of a mutual fund participating in an SME IPO anchor round.

In the March 2026 quarter, Kacholia has gone further. Exchange filings show Kacholia has picked up a fresh 5.4% stake of 10,21,523 shares in Finbud, taking him from zero to a meaningful position in a single quarter.

Why a fintech distribution model with no credit risk

Consolidated sales have grown from Rs 88 cr in FY22 to Rs 223 cr in FY25, with the trailing twelve-month figure at Rs 260 cr, a 3-year compound growth of 36% on the topline. For the half year ending September 2025, sales were already at Rs 139 cr.

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) moved up faster than sales, climbing from Rs 2 cr in FY22 to Rs 15 cr in FY25, with TTM at Rs 17 cr. Operating margins have expanded from 2% to 7%, the typical rhythm of a distribution business that gains scale.

Net profits have moved from a small loss in FY22 to Rs 8 cr in FY25 and Rs 10 cr on a TTM basis.

The return ratios likely caught Kacholia’s eye. Current ROCE is 34% and current ROE is 35.6%, well above the broader fintech distribution peer average. Over three years, the company has averaged an ROE of 42%. In simple terms, every Rs 100 of shareholder money is generating about Rs 36 of profit today.

The listing slump and what changed

Finbud listed on NSE SME on November 13, 2025 at Rs 157, a 11% premium over the issue price of Rs 142, and hit its upper circuit on listing day. But the post-listing journey has not been kind. As per screener.in, the 52-week high is Rs 165 and the low is Rs 76. The stock was trading at around Rs 92 in mid-March and recovered to about Rs 132 by early April, when Kacholia’s stake purchase came to light.

At the current price, the company is trading at a P/E of about 18, against an average peer P/E of 23x. PB Fintech , the largest listed comparable, trades at a far richer multiple. Kacholia’s entry at lower levels suggests he sees a gap between current sentiment and operating reality.

In late March 2026, the RBI cleared a 33.33% stake allotment for a co-founder. In April 2026, Finbud incorporated a wholly owned subsidiary, ZAP Private Limited, to expand into financial product analytics and digital marketing. The strategic direction is to push deeper into secured lending segments like home loans and loans against property, where ticket sizes are larger and commission margins stronger.

For a Rs 175 cr market cap company doing Rs 260 cr of sales with a 35% ROE, the question is no longer whether the business works. It is whether the working capital cycle and lender concentration can be managed as it scales.

Indo SMC: A 74% ROE Play on India’s Power Capex

Incorporated on September 27, 2021, Indo SMC Ltd is in the business of designing and manufacturing a wide range of electrical, industrial and infrastructural products. The company is an ISO certified manufacturer specialising in Sheet Moulding Compound (SMC) products, Fibre Reinforced Plastic (FRP) items, and electrical components such as current and potential transformers along with power distribution equipment.

With a current market cap of around Rs 398 cr, the company runs four manufacturing facilities across Gujarat, Maharashtra and Rajasthan. It supplies enclosure boxes for energy meters, HT and LT transformers, distribution panels, FRP grating, junction boxes and feeder pillars. Customers include State Electricity Boards, DISCOMs, government utilities and private industrial buyers across more than 20 Indian states.

Indo SMC came to market in January 2026 with a Rs 92 cr SME IPO at a price band of Rs 141 to Rs 149. The issue was subscribed 103 times. Ahead of the IPO, the company raised Rs 26 cr from 17 anchor investors. Kacholia was on that list with a 3.4% pre-IPO stake. The shares listed on BSE SME on January 21, 2026 at Rs 149, flat to the issue price.

In the March 2026 quarter, exchange filings show Kacholia held 5,61,405 shares in Indo SMC, which works out to about 2.46% of the company’s equity. The stock has been trading in a range of Rs 134 to Rs 191 in its first few months. By April 22, 2026, it had moved up to Rs 210 after fresh purchase orders worth Rs 35.25 cr.

Triple-digit growth, but with a working capital warning

Sales grew from Rs 7 cr in FY23 to Rs 28 cr in FY24 and then to Rs 139 cr in FY25, a 395% jump on the trailing twelve months. Net profits moved from Rs 0.46 cr in FY23 to Rs 3 cr in FY24 to Rs 15.4 cr in FY25, a TTM profit growth of 415%.

EBITDA grew from zero in FY22 to Rs 23 cr in FY25 and operating margins have stayed in the 17 to 18% band, healthy for an industrial products manufacturer.

For the half year ending September 2025, the company has reported sales of Rs 112.5 cr and net profit of Rs 11.4 cr, suggesting FY26 may end well above the FY25 base.

The return ratios are the second eye-catcher. Current ROCE stands at 47.7% and ROE at 74.5%, with a 3-year ROE of 74.4%. For a capital goods business at this size, those numbers are exceptional. They suggest the company has scaled revenue without locking up large amounts of fixed capital, the classic signature of a niche manufacturer with pricing power.

But there are warning lights. Debtor days have moved from 70 in FY23 to 112 in FY24 and now 124 in FY25, which means the company is taking longer to collect cash, often from state government utilities. Borrowings have grown from Rs 10 cr to Rs 36 cr in two years to fund this gap. Cash from operating activity has been negative for three years in a row, with FY25 at minus Rs 14 cr. The promoter group held 60.09% post-issue as of January 2026, FIIs held 1.97% and DIIs held 7.51%.

The share price of Indo SMC was Rs 222 as on 5^th May 2026, which is a jump of 49% its listing price of Rs 149.

At a P/E of about 26x, the stock is not cheap on an absolute basis. But for a business that has grown sales nearly 20x in two years and is sitting on triple-digit return ratios, the market is pricing in continued execution. The current industry median is 31x.

Why a power equipment maker now?

The bigger pond Indo SMC swims in is the Indian power capex story. State electricity boards are pushing through a Rs 3 lakh cr-plus modernisation programme, smart metering rollouts are accelerating under the Revamped Distribution Sector Scheme, and the government’s push on transmission and electrical safety equipment is creating a multi-year demand window for component makers.

Indo SMC is a small player in a large market. The MSEDCL vendor approval in early 2026 added supply orders of around Rs 10 cr, with the approval valid for two years. Approvals as a vendor with multiple state DISCOMs give it sticky orders.

Kacholia’s Next Multibaggers?

The contrast is instructive. One is a fintech distribution platform with light fixed assets and high working capital intensity. The other is an industrial manufacturer with growing fixed assets and a stretched debtor book. One operates on a 7% operating margin, the other on 17%. One has 3-year sales growth of 36%, the other 395%.

The common thread is what Kacholia has historically looked for, which is operating moats not yet visible to a casual investor. Finbud’s moat is its agent network across 19,000 pincodes plus a tech stack that integrates real-time with banks and NBFCs. Indo SMC’s moat is its DISCOM and SEB vendor approvals, in-house testing labs and product range across SMC, FRP and electricals.

Both stocks trade on BSE SME or NSE SME, which means lower liquidity, higher volatility and tighter circuit limits. SME counters can swing 5 to 10% on a single set of orders, both up and down.

Whether Finbud and Indo SMC become the next entries on that list is too early to call. Both have strong return ratios, growing sales and clean reporting. Both also carry visible risks, including working capital pressure, customer concentration and the volatility that comes with SME listings.

What Kacholia’s entry tells us is not that these stocks are guaranteed winners. It tells us that someone with a long history of patient small-cap investing has decided that the risk-reward at the current price points is worth a Rs 26 cr position. Whether that judgement turns into multibagger returns will depend on execution. The best way to track this story is to add both names to a watchlist and watch quarterly results, working capital trends and order books closely.

Note: We have relied on data from www.screener.in and www.trendlyne.com throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information.

The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.

Suhel Khan has been a passionate follower of the markets for over a decade. During this period, He was an integral part of a leading Equity Research organisation based in Mumbai as the Head of Sales & Marketing. Presently, he is spending most of his time dissecting the investments and strategies of the Super Investors of India.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article. The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The content of the articles and the interpretation of data are solely the personal views of the contributors/writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary