The “Big Whale” has cut stake in 7 stocks. Do you own any?

By Suhel Khan

One of India’s Warren Buffetts, Ashish Kacholia, had recently cut his holding in some stocks form his portfolio and that has the investment community taking notes.

Known as the “Big Whale,” Kacholia is a renowned stock market investor known for his multibagger midcap and small cap picks. His portfolio currently holds 42 stocks valued at over Rs 2,892 cr, with investments in sectors like hospitality, education, and manufacturing.

He co-founded one of India’s first digital entities Hungama Digital, with Rakesh Jhunjhunwala back in 1999 and went on to start his own company, Lucky Securities, in 2003. Normally someone who maintains a low media profile, Kacholia lets his investments do the talking.

Here are the stocks he has cut his stake in…

1. Universal Autofoundry Ltd (UAL)

With a market cap of Rs 115 cr, UAL is a global manufacturer and exporter specializing in the production of Grey Iron, Ductile Iron, and SG Iron Casting. The company boasts a varied clientele with names like Ashok Leyland, Volvo, Renault Trucks, Mahindra and JCB.

This was in fact the biggest surprise for many investors, as Kacholia cut down his stake in UAL from 8.32% as on the quarter ending September 2024 to 3.59% as per the filings made for the quarter ending December 2024.

The sales for UAL have grown at a compounded rate of 17% in the last 3 years, 11% in the last 5 years and 17% in the last 10 years.

The net profit however could be something that could be a reason behind Kacholia’s partial exit. From Rs 8 cr in FY19 to Rs 5 cr in FY24, which is almost a 38% drop in the net profit.

It must also surprise you to know that not only Ashish Kacholia, but Madhulika Agarwal (wife of ace investor Mukul Agarwal) also cut her stake in the company from 8.32% to 3.54% in the same quarter.

2. AWFIS Space Solutions Ltd (AWFIS)

AWFIS Space Solutions Limited (Market Cap Rs 4,902 cr) is a leading workspace solution provider in India, offering a comprehensive range of flexible workspace options adapted for diverse clients, from individual professionals to big corporations.

Kacholia has cut his stake in the company from 4.77% to 3.89%.

The sales for AWFIS have grown from Rs 154 cr in FY19 to Rs 849 in FY24, which is a compounded growth of 41%.

The company has yet to see any profits, but it has cut down on the losses. In FY19 AWFIS reported losses of 62 cr while inn FY24, the losses reported were 18 cr, which means the company is getting better at making a profit.

The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) has shown a solid turnaround as it was a negative Rs 33 cr in FY19, and It grew to Rs 246 cr in FY24.

The company was listed in May 224 at the price of around Rs 421 and is currently trading at Rs 691 (closing 23^rd January 2025), which is an absolute growth of 64%.

AWFIS Space Solutions Ltd share prices

The valuations hold a big shocker, as the shares are currently trading at a PE of 390x, while the industry average is 31x.

The promoter holding for the company has also fallen from 28.24% to 20.44% between the quarters ending September and December 2024, respectively.

What makes this more interesting that right at the time when Kacholia has cut stake and the promoter holdings fell, quite a few domestic institutional investors have picked up a stake in it.

Apart from these, Ashoka Whiteoak India Opportunities Fund, a foreign institutional investor has also picked a 1.35% stake.

3. Basilic Fly Studio Ltd (BFSL)

BFSL is in the business of post-production activities of providing high end visual effects and 2D and 3D conversion.

With a market cap of Rs 711 cr, the company is a leader in VFX (visual effects) with studio headquartered in Chennai and subsidiaries in Canada and UK. BFSL excels in using technology to deliver VFX solutions for movies, TV shows, web series, and commercials.

Kacholia has cut his stake in the company from 1.99% to 1.19%.

The company’s sales saw a steep compounded growth of 80% from Rs 17 cr in FY21 to Rs 100 cr in FY24.

Profits also saw a big jump from a zero in FY21 to Rs 1 cr in FY22 and then to Rs 36 cr in FY24. This makes it a compounded growth of 144% between FY22 and FY24.

The EBITDA has grown from Rs 1cr to Rs 49 cr between FY21 and FY24, making it a compounded growth of a huge 265%.

Now coming to the share price of the company, which is one area that does not match up to the sales, profits, and EBITDA jumps. The company was listed in September 2023 at the price of around 310. A year later in September 2024, the price was at an all time high of Rs 658.

As on the closing of 23^rd January 2025, the price of the stock is Rs 306, which means the stocks prices have corrected over 50% from its all-time high in September.

Basilic Fly Studio Ltd share prices

When it comes to valuations, the company’s share is trading at a PE of 26x while the industry average is 35x.

BFSL is targeting international expansion in Eastern Europe and South Korea.

Apart from these 3 stocks, Kacholia has also cut stake in the following stocks…

Wise to follow the Big Whale?

As many would know, Ashish Kacholia is a follower of Warren Buffet. Which is why he believes the most crucial factor to consider is the company’s management, while investing and their ability to effectively execute the plan can make or break the business’s success.

Which makes us think what is it that has triggered these decisions to cut stakes in the stocks we have discussed above.

To succeed in the volatile stock market, one needs resilience and the ability to both endure difficult periods and exploit favorable conditions, qualities Ashish has consistently shown. So, when he makes such decisions, it is only wise to keep an eye on the stocks in question, especially if you own them.

Disclaimer

Note: We have relied on data from www.Screener.in 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 / 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