listed holding companies in India to invest in ! (an Extensive list)

List of holding companies in India to invest in

Article published as on Tuesday, 21^st July, 2020 at 10:00 a.m.   

I present the extensive list of holding companies to you which are available for investment.

(click here for pdf download of the article and list in detail)

Flow of the article

Introduction

·        What are holding companies?

·        Why invest in holding companies?

Brief review of List of holding companies

Short summary of each company

Conclusion of the article & live google sheet

What are holding companies? 

Holding companies or investment companies are those companies who have invested in another company’s shares and securities.

Majority of holding companies hold shares in their own group companies, examples are companies such as Bajaj investments, Godrej industries and Rane holdings. 

Relationship between holding company and their investments (subsidiary companies at times) is like of ‘horse and buggy’ relationship.

Invested companies are like horse and holding companies are like buggies. Horse will keep pulling the buggies. If you believe in the capability of horse, then you could bet on the buggy itself.

(At times people like to invest directly on horses, rather than investing in buggies as buggies are dependent on horses. And also value unlocking in many of these companies is very uncertain)

These holding companies have their main source of income from returns on investments.

Why invest in holding companies?

These companies are usually companies holding shares of their group companies, which means these are well established and reputed business groups. Hence investing in holding company indirectly makes you invested in their business group.

At times These companies trade at steep discount to the value of their holding making them attractive bets as against investing directly into companies in which they hold shares.

If we consider the value of shares they hold as cash and cash equivalents, then most of these holding companies would be trading at negative enterprise value.

(Enterprise value = market cap + debt - cash and cash equivalents.)

Due to this huge discount, it becomes possible to earn multibagger returns whenever the management decides on shareholder value unlocking. This has happened in Kirloskar brother investments ltd, and also in JK Group when Florence Investech was merged into Bengal and Assam investment ltd.

(Both multiplied investor’s wealth due to value unlocking announcement.)

There are mainly 2 types of holding companies 

Pure holding companies. They are created just to hold securities of other companies 

Holding companies with their own operations as well as investments.

Brief review of list of holding companies.

1) Kirloskar industries ltd

2) HDFC ltd

3) M&M

4) Grasim

5) Godrej industries

6) BBTC

7) Eid parry

8) Summit securities

9) STEL holding

10) Cesc ventures

11) Rajapalayam

12) Ramco industries

13) Sundaram Clayton

14) Sundaram finance holdings

15) Pilani investment

16) Kalyani investment

17) BF investment

18) Nalwa sons

19) Jsw holdings

20) Bengal and Assam holdings

21) Bajaj holding and investment

22) Maharashtra scooters

23) Uniphos enterprise

24) Alembic ltd

25) Kama holdings

26) Balmer Lawrie

27) Vardhman holdings

28) Rane holdings

29) GFL

30) Cholamandalam holdings

31) PTL enterprise

32) Zuari global

33) Welspun investment

34) Future enterprise

35) IDFC ltd

36) Tata investment corp

In the following image Blue represent pure holding companies

Yellow represents holding companies having their own operations as well.

If you are interested in any company highlighted in Green, you can consider investing in their holding companies.

(correction: in the image the kama holding is shown to hold shares in SKF, which is a mistake and it holds shares in SRF ltd.)

Short summary of each of the company:

Starting with Kirloskar industries: the Kirloskar group set a benchmark in corporate governance and now also in value creation: Kirloskar brothers investment ltd (KBIL) was a holding company with no operations and having stake worth more than 2400 crores in Kirloskar oil engines ltd (KOEL) and Kirloskar pneumatic and had a market cap of just 850 crores, implying approximately 65% discount, they decided to do a reverse merge with KOEL. Thus offering 76 shares of KOEL for every 5 shares held in KBIL. Now following such announcement the price soared and the discount reduced. Now the Kirloskar industries is the current holding company of the group, they have holdings in Kirloskar ferrous industries, Kirloskar pneumatic, Swaraj engines, Kirloskar brothers, Kirloskar oil engines LTD. You can read the story here .

Housing Development Finance Corp Ltd : it is a holding company with its own business and operations, its market cap is 3 lakh crore and value of its investment is approximately 1.5 lakh crore, this is because it has its own operations of lending housing loans.

Mahindra & Mahindra Limited: here Mahindra is like a banyan tree spreading its branches like subsidiaries, it has numerous subsidiaries but the prominent ones are listed out here, also it has its own auto operations so main value is derived from tractor/ auto business.

Grasim Industries: it is an Aditya Birla group company, main value of holding is derived through its approx. 60% stake in Ultratech cement. Grasim is also having its operations, its #1 player in viscose staple fibre (VSF) hence value is derived from there as well.

Godrej industries: this company is also having its own operations such as dealing in edible oils and its main holdings are in Godrej Properties, Godrej Consumer, and Godrej agrovet.

BBTC- its major holding is in Britannia it also holds shares in other group companies Bombay dyeing and national peroxide, it has operations in tea and coffee, dental products, and auto ancillary but these all are not profitable, also another thing to note is they don’t have any stake in Go Air.

EID parry, this company is from Murugappa group, this company has huge operations in sugar business it also deals in nutraceuticals, and making of alcohol to be used as fuel, apart from this it has huge shareholding in Coromandel international which is a fertilizer company,

Summit securities: this is a holding company from RPG group belonging to Harsh vardhan Goenka having no operations of its own.

It has major shareholding in Zensar technology, STEL holdings, KEC international and CEAT limited.

STEL holdings: this is from RPG group having stakes in both harsh Vardhan Goenka and Sanjiv goenka group companies

Cesc Ventures: this company belongs to RP Sanjiv goenka group, it has major stake in first source solution, apart from that it has own IT operations, mall operating in Kolkata and FMCG companies mainly ‘Too yum’ (click here to read my blog on this company)

Rajapalayam mills: this company is from ramco group, it has its operations relating to textiles and yarn manufacturing which is profitable, they also have stake in other group companies, mainly in Ramco cements, Ramco systems, Ramco industries limited, they are have been buying some of the shares of group companies in recent times. So figures may vary slightly.

Ramco industries limited: it is from Ramco group as well has its operations related building materials such as calcium silicate board which are alternative to ply board, it has investment in various companies such as Rajapalayam mills, Ramco cements and Ramco systems and interest in wind energy, textiles, roofing and building material related activities.

Sundaram Clayton: this company is from TVS Sundaram group of companies having major stake in TVS motors as well as having its own operations in auto ancillary.

Sundaram finance holding limited: this company is from TVS Sundaram group it holds non-core business of Sundaram finance ltd and was demerged as a result, hence it is a holding company now. It has all the unlisted business related to auto ancillary.

Pilani investment & industry corp ltd: it is a B.K Birla group company holding investment in various group companies, its major investment are in Grasim, Ultratech cement, Hindalco and century textiles and in several other companies

Kalyani investment: this is the holding company of Baba Kalyani group and has major holdings in Bharat forge, BF utilities, Hikal ltd, and has investments in sectors such as forging, steel, power generation, chemical and banking etc.

Bf investment : this baba kalyani group holding company was demerged from BF utilites it major investment which are listed are kalyani steels(39.06%), automotive axles (35.52%), bharat forge (3.35), BF utilites(3.15%), hikal ltd(2.65%), and some of the major unlisted investments are KSL holdings(42.52%), Meritor HVS(49%), khed economic(SEZ)(15.88%).

Nalwa sons: this is the holding company of JSW group (Sajjan Jindal),

It has major investment in JSW steel and JSW holdings.

This group has main interest in Steel and power businesses.

JSW holdings: it is another JSW group holding company with listed assets worth 3603 crores with main value being derived from JSW steel , discount is not much but it has substantial investment in unquoted equity shares of around 1003 crores and has investment in preference shares worth 1618 crores (fy20 figures) on a market cap of 2169 crores.

Bengal and Assam Company limited: this is a J. K. Singhania group company also known as J. K group. It was merged with another listed company called Florence investech for value unlocking of investors, which seemed logical as both companies had similar investments and belonged to same group ( interesting thing is that Florence investech multiplied in value due to this scheme of amalgamation). It is an investment company and also holds very few shares of several other companies (for full list of investment visit page number 51 on this annual report) its main holdings are JK tyres and industries, JK Lakshmi cement, JK agri, JK paper and Umang diaries.

Bajaj holding and investment: this is a Bajaj group holding company after demerged from Bajaj auto in 2008 three companies were formed this is one of them other being its major holding Bajaj Finserv, Bajaj Auto and Maharashtra scooters. This company also has shares of several other companies, and it is also going on increasing its stake in the the above mentioned company.

Maharashtra scooters: it was a joint venture between Maharashtra government and Bajaj group to manufacture scooters, recently bajaj investment and holdings acquired remaining stake and made it a subsidiary. Now it is a holding company with stakes in

Uniphos enterprise limited: this company holds 5% stake in United Phosphorous limited (UPL) and trades at approximately 75% discount to its holding value.

Alembic ltd: the company primarily operates in manufacturing of bulk drugs (69.33% of revenue) and real estate (30.67% of revenue). It has 29.47% stake in alembic pharmaceuticals as well and a minority holding in Paushak ltd.

Kama holdings: it is an investment company with its 3 subsidiaries ‘shri educare ltd’, ‘KAMA realty (Delhi) ltd’ and ‘SRF transnational holdings’ it operates in education sector, reality sector, and investment in other companies. SRF ltd has business interest in technical textiles, fluorochemicals, speciality chemicals and packaging films

Kama holdings has 52.28% in SRF ltd.

Balmer Lawrie investment company: this company holds 61.80% in Balmer lawries & co, other than that it does not have its own operations, it’s a pure holding company promoted by Government of India, its discount value is not attractive compared to other companies.

Vardhman holdings: this is another pure investment company and has major investments in Vardhman textiles, Vardhman acrylics, Vardhman special steels, along with it has very small investments in other companies as well.

Rane holdings: this holding company holds major stakes in Rane (madras) ltd, Rane engine valve ltd, Rane brake lining ltd effectively making them subsidiaries. Here the holding company discount does not prevail. It has its own business and operations mainly relating to auto components.

GFL: originally Gujarat fluorochemical limited, later it was demerged from chemical business making it pure holding company, it has stake in Inox wind and Inox leisure. Apart from this it has stake in Inox renewables, and Inox infrastructure. (Its website is not yet created)

Cholamandalam financial holding: part of Murugappa group it houses 45.50% stake in Cholamandalam investment and finance ltd and also has 60% stake in Cholamandalam MS General Insurance Company Ltd, which is unlisted.

PTL enterprise: this holds shares of Apollo tyres, this company leases its premises to Apollo tyres and earns approximately 60 crores annually, and from last 2 years it has been investing in the shares of Apollo tyres.

Due to stable nature of business and certainty of income generated, its shares are also stable around 40 rupees earning a dividend yield of 6.20% on a market cap of 265 crores.

Zuari global: this is the investment company of the Zuari group, it has investments in unlisted group companies, and its major investments in listed space are of Zuari Agro, Chambal fertilizers, Texmaco infrastructure and holdings ltd, Texmaco rail and engineering ltd. So to invest in agriculture and fertilizer sector one can invest in Zuari global.

Welspun investments and commercial: this company holds investments in Welspun group and it also has its own operations which generate very low amount of profits, it has investments in Welspun corp and Welspun enterprise, it is trading at almost same value to its holdings as on this date.

Future enterprise limited: this company is from future group, this company with market cap of 535 crores is having major stake in future supply chain. Also it has interest in other business such as insurance, textile manufacturing and logistics. It also has its own operations relating to, it’s EBITDA in FY18 and FY19 were 1288 crores and 1346 crores but PAT was -12 crores and 24 crores respectively, indicating high amount of interest payment and debt obligations.

IDFC ltd: this company is promoted by Government of India and it was involved in infrastructure financing, later demerged and IDFC bank was formed, currently it holds 40% in IDFC first bank, it also operates IDFC mutual fund having AUM in excess of 1 lakh crore and having FY20 profits of 80 crores.

Tata investment corp: its core and major investments are in Tata group companies, they also hold shares on unlisted Tata capital and Tata AMC. This holding company is more like a mutual fund, the company keeps on buying and selling investments (one can know their list of investment here pg no. 95 annual report FY20)

Another good thing about Tata investment corp is that in FY19 they conducted buyback to enhance shareholder value. Normal discount range for this company is 25% to 50%.

Maharashtra apex: this company is holding shares of Kurlon ltd which in turn holds shares of Kurlon enterprise, after the listing of Sheela foam the stock gave a stellar rally, but due to uncertainty of listing of Kurlon enterprise I have not produced detailed research.

Tainwala chemicals: this unheard stock holds 8.8% stake in ‘Samsonite Southeast Asia’ which is competitor of VIP industries and safari industries. Due to investment in unlisted shares and lack of management background available to research, I have not done detailed study here also.

Apart from these there are holding companies such as Nahar capital, Dhuneseri investments, McDowell’s holdings,Elcid investment (illiquid), Majestic auto ltd ( holding shares in hero motocorp),

williamson magor, Adani enterprise, PFC, PTC India and several PSU stocks with cross holdings.

I am just mentioning these stocks but I am not very much confident about these hence I have not did a detailed study.

Conclusion and live google sheet:

Holding companies are a good way to indirectly diversify you investments as they tend to hold shares of different companies.
(They act more or less like a concentrated mutual fund.)

Holding companies have potential of value unlocking thus rewarding good 
returns. (these could also turn out to be value traps.)

They tend to move more or less in line with their underlying.

They carry risk of failure in entire group or delisting offer below intrinsic value.

I feel companies trading at around 70% or more discount with good management are an opportunity as we have enough margin of safety

.

Here is the live google sheet and also the link to visit.

(Best viewed in web version or desktop)

Google sheet link.

Here is the live google sheet to view

UPDATE AS ON 8^TH January, 2021

 

List of all holding companies in India

 

(Note: not all companies mentioned are good investment option, this list is compilation of holding companies listed in India)

 

NBI industrial 

Holds shares in the company Shree cements.

 

ICICI bank, conglomerate holding various financial institutions 

SBI as well for the same reasons.

 

SIL investment: Birla Group Company already red flagged in Zuari global article. (Link here)

 

Ambuja cements owns 50% stake in ACC

 

Industrial and prudential investment company ltd.

Holds stake in

Universal cables

In birla corp

Birla cables

Vindhya telelinks

 

 

Vedanta 

Hold major stake in hind zinc and Sterlite technologies.

 

Andhra sugars

Holds Andhra petrochemicals.

 

Welspun enterprise

Holds shares of wespun group companies

 

VLS finance

Holds shares of Relaxo footware and also trades at significant discount

 

Yamuna syndicate 

Holds ISGEC heavy engineering

 

West coast paper mills 

Holds 72.20% in Andhra papers.

 

Majestic holds hero shares

 

BNK capital holds shares mostly related to RPG group companies along with many other shares.

 

HT media 

Holds 75% shares in Hindustan media ventures.

(Has corporate governance issues, hence red flagged)

 

Mysore petrochemicals

Holds stake in IGPL (listed company)

 

Tata chemicals

Holds substantial value through unlisted stake in Tata sons.

 Update as on 31^st January, 2021

 

Oswal agro mills holds stake in

Oswal Greentech

 

Neelamalai Agro ltd holds 40% stake in AVT naturals product ltd (speciality and biochemicals kind of company…someone interested into this sectors should have a look into this)

Random listed companies having stake in other listed companies

Hathway owns GTPL hathway (hathway, DEN network and TV18 were proposed to be merged into Network18 for streamlining the media business of reliance industries)

Zee learn owns MT educare

Finolex pipes and finolex cables have cross holdings among each other.

(Update as on 27^th June, 2021)

Andrew Yule holds 26.22% shares of Tide water Oil.

Sayaji Hotels holds 45.10% shares of Barbeque nation. 

Equitas holding holds stake in Equitas small finance bank.

Ujjivan Financial service Holds stake in its Ujjivan small finance bank.

Nahar Capital holds stake in its various group companies.

InfoEdge holds stake in several unlisted start-up companies.

Glenmark Pharma has holding in its soon to be listed Glenmark Lifescience.

Industrial & Prudential Investment Company Ltd holds 20.80% stake in KSB Ltd and holds several small investments in listed Indian Companies. 

KDDL holds 75% in Ethos Ltd (Retailer of Luxury watches)

I would like to know your thoughts on this.

Also please comment if you are aware of any holding company which is not mentioned in this post, I may expand this list further on discovery of some new names!

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