Radhakishan Damani Portfolio: Top 5 Stocks

The stock market is a difficult place for an average investor to survive. There is too much noise, confusion, and financial jargon. To steer clear of this dilemma, it's important to learn from the best.

That is why many follow the footsteps of investing gurus of the stock market. Lately, this strategy has become one of the most effective investment strategies one can follow.

These investing gurus have a successful track record of beating market like returns and a knack of identifying multibagger stocks. One such investing guru in India is Radhakishan Damani.

Radhakishan Damani is a Mumbai-based entrepreneur, businessman, and billionaire investor who founded India's mega-retail chain D-Mart.

He is considered to be one of the Big Bulls in the Indian stock markets. He manages his portfolio through his family investment firms, and two more firms namely Bright Star Investments and Derive Trading.

Today, we take a look at Radhakishan Damani's portfolio and his current top 5 investments.

Publicly available data shows that Damani holds 13 stocks in total. These five stocks highlighted below are his biggest investments at present in value terms and not volume.

#1 Avenue Supermarts (DMart)

No surprises here. Everyone in the investing community knows Damani is known for his big success in Avenue Supermarts.

Damani came to fame and was considered India's retail king after the March 2017 IPO of his supermarket chain Avenue Supermarts.

As of September 2022, shareholding pattern of Avenue Supermarts shows that Radhakishan Damani holds over 65% stake in the company.

Damani holds these shares via his family accounts and investment firm Bright Star Investments.

Under Bright Star Investments, Damani holds 13.7% stake or 88.8 m shares. Rest is owned under the family name.

Damani was the one who set up the supermarket chain in 2001 so his stake in the company is categorised under the promoter category.

Considering Avenue Supermarts current market price of Rs 3,859 as on 6 January 2023, Damani's total value in the supermarket chain comes to a little over Rs 1,687.9 billion (bn).

The promoter holding in Avenue Supermarts has remained constant over the years, with none of the other promoters or Damani offloading any stake.

Ever since its debut in March 2017, DMart shares have delivered returns of 502% till date.

The credit goes to Radhakishan Damani for DMart's success as it was his vision which brought the company where it is today. Barely two decades old, the company has distinguished itself in a crowded and fragmented retail industry.

With its unique strategy of having an ownership model in strategic areas, no frills, customer friendly discount model, and a limited category of products, it has established loyal customer base. DMart has rendered the competition irrelevant.

From just one store in 2002 to more than 280 stores at present, what clicks for DMart is that it owns these stores. In the future if real estate prices rise, DMart is able to capture future price appreciation.

Another thing which works in the favour of DMart is its focus on providing deep discounts to its customers thereby creating value for them.

With no debt on its books, DMart has been funding its capex through its earnings. This reflects DMart's operational efficiency and the strength of its business model.

In 2022, DMart share price was falling as margins came under pressure due to competition and revenue per square feet came in below pandemic levels.

The company has aggressive plans of opening new stores going forward. The company plans to boost its store count fivefold as it seeks to grow market share and hold its own against aggressive expansion from the likes of Mukesh Ambani's Reliance Retail.

To know more, check out Avenue Supermarts financial factsheet and its latest quarterly results.

#2 VST Industries

Next on this list is VST Industries.

As of September 2022, shareholding pattern of VST Industries shows that Damani holds 30.71% stake in the company or 4.1 m shares in total.

Considering VST Industries current market price of Rs 3,220 as on 6 January 2023, Damani's total value in the company comes to around Rs 15.3 bn.

Initially, Damani bought around 15% stake in VST Industries in 2000. Back then, the shares were acquired at an average price of Rs 80, according to reports.

Damani's investment in VST came at a time when the company's cash flows were going and there were (and still are) high entry barriers in the cigarette business.

Damani, over the years, bought additional stake in the company in his individual capacity. Here's how VST Industries share price has performed since Damani acquired stake.

Post his big acquisition in 2000, Damani intended to buy more and was willing to pay Rs 112 per share for an additional 20% stake in VST in February 2001. But he was unable to acquire a controlling stake due to many of the complexities, which also involved ITC making a bid for VST.

Here's an interesting fact. Damani held more stake in VST Industries till June 2022 than the company's promoters.

VST Industries has stayed resilient over the years, even after coming under the scanner various times due to ESG concerns.

One look at the company's numbers will tell you this it ranks high on most parameters. The average return on equity (ROE) and return on capital employed (ROCE) of VST Industries for past five years are 36% and 51%.

The company has a solid track record of stable profits and revenues for the past two decades. It has handsomely rewarded shareholders with dividends too. The company has paid more than 50% of its profits as dividends without fail for more than a decade now.

All this with zero debt on its books.

VST is in a segment which has high barriers to entry. This is a big plus point for the company. Cigarette advertisements and FDI investments in cigarettes are banned by the government. This prevents competition from big foreign firms.

While there are big players like ITC and Godfrey Phillips in the segment, VST has stayed away from competing with them by focusing on a different set of customers, the rural population.

To know more, check out VST Industries financial factsheet and its latest quarterly results.

#3 India Cements

Third on this list is India Cements.

As of September 2022, shareholding pattern of India Cements shows that Damani and his family hold 20.8% stake in the company.

Considering India Cements current market price of Rs 220.7 as on 6 January 2023, Damani's total value in the company comes to around Rs 14.2 bn.

Here's how Damani's stake in the company has varied over the past few quarters.

Quarter Ending	Stake (%)
Dec-20	21.1
Mar-21	21.1
Jun-21	21.1
Sep-21	21.1
Dec-21	21.1
Mar-22	20.8
Jun-22	20.8
Sep-22	20.8

Data Source: Ace Equity

The stock of India Cements has seen a good correction of late. It has not added any significant capacity post 2010. This, combined with other headwinds, have affected the stock.

Headwinds in the form of consolidation in the sector with Adani group's acquisition of Ambuja Cements and ACC. Sharp rise in raw material prices leading to a lower capacity utilisation, and high debt are a few other headwinds.

However, the company has an established presence in the southern region and enjoys some tailwinds due to its geographical footprint.

As things stand now, the demand for cement is high due to the government's infrastructure push and increasing need for urban housing. This bodes well for the top cement stocks as well as India Cements in the near term.

To know more, check out India Cements financial factsheet and its latest quarterly results.

#4 Sundaram Finance

Fourth on this list is TVS group company Sundaram Finance.

As of September 2022, shareholding pattern of Sundaram Finance shows that Damani holds 2.37% stake in the company or 2.6 m shares in total.

Considering Sundaram Finance's current market price of Rs 2,387 as on 6 January 2023, Damani's total value in the company comes to around Rs 6.3 bn.

Damani's investment in Sundaram Finance dates back to over a decade. He is holding shares for around 11 years now, which he purchased at Rs 140 per share.

His holding in Sundaram Finance has not varied much over the years.

The TVS group company has a diversified presence in Mutual Funds, Housing Finance, General Insurance, IT, Business Process Outsourcing, and Retail Distribution of a wide array of financial services and products.

Although Sundaram Finance is part of TVS Group, it operates independently. The company was relatively unaffected by the troubles that had beset non-banking financial companies in recent times.

This is due to its conservative approach, superior credit standards, strong customer relationships and systematic collection efforts which have ensured best-in-class performance on asset quality.

To know more, check out Sundaram Finance's financial factsheet and its latest quarterly results.

#5 Blue Dart Express

Last on the list is logistics player Blue Dart Express.

As of September 2022, shareholding pattern of Blue Dart shows that Damani holds 1.4% stake or 0.3 m shares of the company.

Considering Blue Dart's current market price of Rs 7,698 as on 6 January 2023, Damani's total value in the company comes to around Rs 2.6 bn.

Damani holds stake in Blue Dart for over a decade, but he has increased and decreased his stake many times.

Here's how his holding in the company has varied in the past few quarters.

Quarter Ending	Stake (%)
Dec-20	2.0
Mar-21	2.0
Jun-21	1.7
Sep-21	1.5
Dec-21	1.5
Mar-22	1.4
Jun-22	1.4
Sep-22	1.4

Data Source: Ace Equity

In 2011, Blue Dart's promoter DHL Express approached Radhakishan Damani to secure his backing for a delisting. Back then, Damani was the second biggest investor and held a 5.5% stake.

Blue Dart still trades on the bourses which means the delisting didn't go ahead for some reason. And rightly so because the share price has risen tremendously since then.

Blue Dart is a dominant player in the domestic express service industry. It has a strong brand reputation and an early-mover advantage.

Support from its parent group makes sure the company has access to the largest express and logistics network.

Going forward, the logistics company is readying itself for next round of expansion and increasing operations to China and Vietnam.

To know more, check out Blue Dart's financial factsheet and its latest quarterly results.

Which other stocks has Radhakishan Damani invested in?

Apart from the above five, here are some other stocks which Damani has invested in as of September 2022.

Please note, the source of holdings listed below is from Ace Equity and it may or may not be a complete list of holdings.

Company	Shareholder's name	No of shares	Percentage	Price (Rs)
Metropolis Healthcare Ltd.	Bright Star Investments Pvt Ltd	546,274	1.07	1,367
Sterling Holiday Resorts (India) Ltd.(Amalgamation)	Bright Star Investments Pvt Ltd	1,812,000	2.01	250
Aptech Ltd.	GOPIKISHAN SHIVKISHAN DAMANI	1,255,227	3.03	356
United Breweries (Holdings) Ltd.	Derive Trading	1,071,000	1.60	11
Sterling Holiday Financial Services Ltd.	Bright Star Investments Pvt Ltd	1,812,000	2.01	2

Data Source: Ace Equity

Recently, we also wrote about Dolly Khanna portfolio, Ashish Kacholia portfolio and Vijay Kedia's portfolio.

Stay tuned to get more updates on investment gurus as we cover more such pieces in the coming weeks.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...