Novastar International Fund: Illustrative Investments
The fund invests in profitable, dividend paying small and mid-cap companies that have the
potential to emerge as stars over a medium term investment horizon.
Amara Raja Batteries Ltd. is a JV partner of Johnson Controls, USA. It has a 26% market share of automotive battery and a 30% share of industrial battery market in India. It has nearly trebled manufacturing capacity over the past four years. India's rapidly growing four-wheeler, two-wheeler markets and industrial growth are driving battery demand. India is also a growing export hub for automotive and engineering components. Revenues rose from $81M in 2006 to $460M in 2011 while net income rose from $5.1M to $41M.
Bajaj Electricals Ltd. is a leading player in lighting, consumer durables and project engineering. Lighting consists of lamps, tubes and luminaries. Consumer durables cover appliances and fans. Engineering and projects comprises electrical transmission line towers, poles and special projects including stadium lighting and rural electrification projects. In the consumer durables business, Bajaj is the Indian market leader in electrical fans, geysers and irons. Revenues rose from $210M in 2006 to $630M in 2011 while net income rose from $7M to $26M.
Shriram Transport Finance Corporation Ltd. is a leader in truck financing in India. It has a market share of around 25% to 30% of the used truck financing business. It has expanded its product portfolio to include financing of used tractors, small commercial vehicles, 3-wheelers, passenger commercial vehicles and construction equipment. It has a nationwide presence through 498 branches and nearly 16,000 employees. It is one of the largest non-banking financial companies in India. Its revenues grew from $310M in 2006 to $1200M in 2011 while net income rose from $42.3M to $270M.
Eros International Media Ltd. is a dominant global player in the distribution of Indian films and has been in the business for three decades. The company sources or acquires films and distributes through multiple formats such as theatres, cable/satellite TV and digital media. Eros has an extensive library of 1100 films across Hindi, Tamil and other regional languages. The group has a strong distribution network across 50 countries. Revenues rose from $39M in 2006 to $155M in 2011 while net income rose from $2M to $24M.
VST Tillers Tractors Ltd. has 40% market share of the power tiller market in India. Power Tillers are handheld small tractors used for ploughing, weeding and other farm operations. They are useful in small acreages for paddy, wheat and vegetable cultivation. The typical land holding in India is less than 2 hectares and hence power tillers are well suited for agri-mechanization. The company is also a leader in the sub 20 HP tractors which are ideal for farmers who cultivate vegetables, tend orchards, or raise cash crops. India is at the cusp of major trend of agri-mechanization due to non-availability of farm labour, rising wages and urbanization. Revenues rose from $29M in 2006 to $96M in 2011 while net income rose from $2M to $9M.