“Big Whale” reduced its stake in 7 stocks, do you own any of these stocks?

He co-founded Hungama Digital, one of India’s first digital institutions, with Rakesh Jhunjhunwala in 1999 and started his own company Lucky Securities in 2003. Kacholia, who is generally less discussed in the media, expresses his views only through his investments.

Here are the stocks in which he reduced his stake…

1. Universal Autofoundry Limited (UAL)

With a market capitalization of Rs 115 crore, UAL is a global manufacturer and exporter specializing in the production of gray iron, ductile iron and SG iron castings. The company has renowned customers like Ashok Leyland, Volvo, Renault Trucks, Mahindra and JCB.

This was actually the biggest surprise for many investors, as Kacholia reduced its stake in UAL from 8.32% to 3.59% in the quarter ended September 2024, as per the filing made for the quarter ended December 2024.

UAL’s sales 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.

However, net profit could be something that could be a reason behind Kacholia’s partial exit. From Rs 8 crore in FY19 to Rs 5 crore in FY24, which is about 38% decline in net profit.

You will also be surprised to know that not only Ashish Kacholia, but Madhulika Aggarwal (wife of prominent investor Mukul Aggarwal) also reduced her stake in the company from 8.32% to 3.54% in the same quarter.

2. AWFIS Space Solutions Limited (AWFIS)

AWFIS Space Solutions Ltd. (Market cap Rs 4,902 crore) is a leading workplace solutions provider in India, offering a wide range of customized flexible workplace options to diverse clients, ranging from individual professionals to large corporations.

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

AWFIS sales have grown from Rs 154 crore in FY19 to Rs 849 crore in FY24, a compounded growth of 41%.

The company has not made any profit yet, but it has reduced its losses. In FY19, AWFIS recorded a loss of Rs 62 crore while in FY24 the loss was Rs 18 crore, which means the company is getting better at earning profits.

EBITDA (earnings before interest, taxes, depreciation and amortization) has shown a solid turnaround as it was negative Rs 33 crore in FY19, and it increased to Rs 246 crore in FY24.

The company was listed in May 2024 at a price of around Rs 421 and is currently trading at Rs 691 (close on January 23, 2025) , Which is a complete increase of 64%.

AWFIS Space Solutions Ltd Share Prices

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

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

What makes it more interesting is that at the same time when Kacholia reduced stake and the promoter stake came down, some domestic institutional investors bought stake in it.

Apart from these, foreign institutional investor Ashoka WhiteOak India Opportunities Fund has also bought 1.35% stake.

3. Basilic Fly Studio Limited (BFSL)

BFSL is in the business of providing high-end visual effects and post-production activities of 2D and 3D conversion. With a market cap of Rs 711 crore, the company is a leader in VFX (Visual Effects), with its studio headquartered in Chennai and subsidiaries in Canada and the UK. BFSL excels in using technology to deliver VFX solutions for films, TV shows, web series and commercials.

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

The company saw a rapid growth of 80% in sales from Rs 17 crore in FY21 to Rs 100 crore in FY24.

There was also a big jump in profits which increased from zero in FY 21 to Rs 1 crore in FY 22 and then to Rs 36 crore in FY 24. This has resulted in a compounded growth of 144% between FY 22 and FY 24.

EBITDA has increased from Rs 1 crore to Rs 49 crore between FY 2021 and FY 2024, which is a tremendous compounded growth of 265%.

Now talking about the share price of the company, this is one area which does not match the jump in sales, profits and EBITDA. The company was listed in September 2023 at a price of around Rs 310. A year later in September 2024, the price was at an all-time high of Rs 658.

23 At the close of January 2025, the stock price is Rs 306, which means the stock prices have declined by more than 50% from their all-time high in September.

Basilik Fly Studio Ltd Share Prices

As far as valuations are concerned, the company’s stock is trading at 26x PE, 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 reduced stake in the following stocks…

Is it wise to chase big whales?

As many people know, Ashish Kacholia is a follower of Warren Buffett. This is why he believes that the management of a company is the most important factor when investing, and their ability to execute the plan effectively can make or break the success of the business.

This forces us to think what is the reason due to which we have decided to reduce stake in the stocks discussed above.

To succeed in the volatile stock market, one needs flexibility and the ability to endure tough times and take advantage of favorable circumstances, qualities Ashish has consistently shown. Therefore, when he takes such decisions, it is wise to keep an eye on the respective stocks, especially if you own them.

Disclaimer

Note: We have relied on data from www.Screener.in throughout this article. Only in cases where data was not available, we used alternative, but widely used and valid information sources.

The purpose of this article is simply to share interesting charts, data points, and thought-provoking opinions. This is not a recommendation. If you wish to consider investing, you are advised to consult your advisor. This article is for educational purposes only.

Suhail Khan has been following the markets for more than a decade. During this period, he was also the Head of Sales and Marketing at a leading equity research organization based in Mumbai. Currently, he is spending most of his time analyzing the investments and strategies of India’s super investors.

Disclosure: The writer and his dependents do or do not hold the stocks discussed in this article. The website managers, its employee(s), and contributors or writers or 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 or writers or 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.