The 10th Annual New York Value Investing Congress takes place in New York on September 8th and September 9th 2014. ValueWalk will be providing coverage of the event- see a long thesis from Marcelo Lima below.
Marcelo Lima is the Managing Member of Heller House, a value-oriented investment management company focused on event-driven, undervalued securities globally. Prior to founding Heller House, Mr. Lima worked in the acquisition and financing of commercial and residential real estate, and was an analyst at New York based hedge fund T2 Partners. Mr. Lima graduated from Cornell University with a Bachelor of Science in Engineering.
Marcelo Lima: An Owner-operator to Rally Around
Talking about a retailer. Fast growing, $2bn market cap, catalysts for value creation, potential upside of 200-300% over the next few years.
Retail in general – common conception that physical retail is dead. E-commerce sales are only 6% of all retail sales. Half of which are actually going to retailers with physical stores. Conclusion: retailers that adapt will survive.
Food retail – least affected by e-commerce trends. Highlighted missteps by Tesco PLC (LON:TSCO).
Marcelo Lima’s Presentation Idea – Casino Guichard Perrachon SA (EPA:CO)
French food retailer with several foreign assets in Brazil, Colombia and Thailand. Derives 65% of earnings from emerging markets while only 35% of sales come from EM. Jean-Charles Nouri is CEO and controlling shareholder.
Market cap of 10bn Euros while foreign entities worth over 11bn Euros (publicly traded entities), implying a negative value for the French business.
Big emerging markets play exploiting increasing urbanization and growing middle class populations in those markets. Values the company at 122 Euros per share compared to a current price of 90.
Marcelo Lima’s Real Idea – Rallye SA (EPA:RAL)
Best way to invest in Casino. Holding company used by Jean-Charles Naouri to control Casino. Leveraged way to play. Company has been tendering bonds. Currently trades at 36 Euros and NAV is at 52 Euros. Adding in upside from French businesses and other holdings gets between 120-150 Euro NAV.