Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

A couple of weeks ago <a href="https://www.smartkarma.com/entities/allcargo-logistics-ltd" target="_blank" data-smartkarma-citation="entities:10602:1" rel="noopener">Allcargo Logistics (AGLL IN)</a>'s delisting effort failed as shareholders rejected the proposal in a rare historical event. I discussed this in <a href="https://www.smartkarma.com/insights/allcargo-agll-in-shareholders-reject-what-now" target="_blank" data-smartkarma-citation="insights:57570" rel="noopener">Allcargo (AGLL IN): Shareholders Reject! What Now?</a> explaining why this does not have to be entirely bad news for the company as it could also be perceived as  a sign of shareholder confidence in the company's fundamentals. Although the initial reaction was negative as expected, the shares have gained more than 10% since then. Yesterday, the company made a <a href="https://www.bseindia.com/xml-data/corpfiling/AttachLive/4da4d302-feb2-46a5-855e-22ec0813e054.pdf" target="_blank" rel="noopener">stock exchange announcement</a> that they had "appointed Jefferies Financial as Investment Banker to evaluate fund raising opportunities for private equity and strategic investment in international supply chain business, which operates under the brand name 'ECU Worldwide'". In this insight we take a look at the details of ECU Worldwide ("ECUW") and the potential implications of this divestiture on Allcargo.

A couple of weeks ago Allcargo Logistics (AGLL IN)'s delisting effort failed as shareholders rejected the proposal in a rare historical event. I discussed this in Allcargo (AGLL IN): Shareholders Reject! What Now? explaining why this does not have to be entirely bad news for the company as it could also be perceived as  a sign of shareholder confidence in the company's fundamentals. Although the initial reaction was negative as expected, the shares have gained more than 10% since then. Yesterday, the company made a stock exchange announcement that they had "appointed Jefferies Financial as Investment Banker to evaluate fund raising opportunities for private equity and strategic investment in international supply chain business, which operates under the brand name 'ECU Worldwide'". In this insight we take a look at the details of ECU Worldwide ("ECUW") and the potential implications of this divestiture on Allcargo. 

Allcargo (AGLL IN): ECUW Stake Sale at US$1bn Proposed Valuation

Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Shareholder activism is on the rise in India. Institutional shareholders are making their vote count. Proxy advisor firms are also playing a role in guiding institutions to leverage their voting rights prudently. Over the past few months, we saw several instances of activism, mostly through adverse voting and complaining on public forums like earnings call. In a couple of cases, large shareholders (&gt;10% ownership) have also used their rights under Companies Act to call an extraordinary general meeting (EGM) to push for change of board and management.
In our detailed insight below, we discuss many such instances that transpired over the past few months. We also discuss our key takeaways for the Indian markets from this uprising activism.

Shareholder activism is on the rise in India. Institutional shareholders are making their vote count. Proxy advisor firms are also playing a role in guiding institutions to leverage their voting rights prudently. Over the past few months, we saw several instances of activism, mostly through adverse voting and complaining on public forums like earnings call. In a couple of cases, large shareholders (&gt;10% ownership) have also used their rights under Companies Act to call an extraordinary general meeting (EGM) to push for change of board and management.
In our detailed insight below, we discuss many such instances that transpired over the past few months. We also discuss our key takeaways for the Indian markets from this uprising activism.

The Rise of Shareholder Activism in India

<a href="https://www.smartkarma.com/entities/allcargo-logistics-ltd" target="_blank" data-smartkarma-citation="entities:10602:1" rel="noopener">Allcargo Logistics (AGLL IN)</a> announced after market-close yesterday that their shareholders had rejected their proposal for voluntary delisting bringing an abrupt end to an event trade that was gathering a lot of momentum. Since the time the Deal was announced in August 2020, Allcargo share price has more-than-doubled.However, this is now a Deal Break situation. More below the fold.

Allcargo Logistics (AGLL IN) announced after market-close yesterday that their shareholders had rejected their proposal for voluntary delisting bringing an abrupt end to an event trade that was gathering a lot of momentum. Since the time the Deal was announced in August 2020, Allcargo share price has more-than-doubled.However, this is now a Deal Break situation. More below the fold.

Allcargo (AGLL IN): Shareholders Reject! What Now?

India-based integrated logistics company <a href="https://www.smartkarma.com/entities/allcargo-logistics-ltd" target="_blank" data-smartkarma-citation="entities:10602:1" rel="noopener">Allcargo Logistics (AGLL IN)</a> received a “<a href="https://www.bseindia.com/xml-data/corpfiling/AttachHis/9bf60829-9be9-4e37-b6c2-234cc3203040.pdf" target="_blank" rel="noopener">Delisting Proposal</a>" from its Promoter Group (Shashi Kiran Shetty and Talentos Entertainment Private Limited) in August 2020. Since then, the stock has gained more than 70%. <section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/221/026/original/SK+Insights.png?1627546045" class="editor-image img-responsive" data-smartkarma-image-id="221026"></figure><div class="content-caption">Source: Smartkarma</div></section>I have covered this situation three times since the Deal was announced (as indicated by the "①" markers in the figure above) taking a Bullish stance on all three occasions as I believed the stock was fundamentally undervalued on a growth-adjusted basis. <ul>
<li>
<a href="https://www.smartkarma.com/insights/allcargo-logistics-agll-in-indian-delisting-offer-trading-cheap" target="_blank" data-smartkarma-citation="insights:43137" rel="noopener">Allcargo Logistics (AGLL IN): Indian Delisting Offer Trading Cheap</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/allcargo-logistics-agll-in-shareholder-vote-encouraging-buying-opportunity" target="_blank" data-smartkarma-citation="insights:44464" rel="noopener">Allcargo Logistics (AGLL IN): Shareholder Vote Encouraging. Buying Opportunity.</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/allcargo-agll-in-42-up-so-far-how-much-more-to-go" target="_blank" data-smartkarma-citation="insights:54125" rel="noopener">Allcargo (AGLL IN): +42% Up So Far. How Much More to Go?</a> </li>
</ul>Last week, the company announced that the Delisting Process has been "reinitiated" causing the share price to rise sharply. So what does this mean and how does this affect the timeline and the upside potential of the event?Read below to find out.

India-based integrated logistics company Allcargo Logistics (AGLL IN) received a “Delisting Proposal" from its Promoter Group (Shashi Kiran Shetty and Talentos Entertainment Private Limited) in August 2020. Since then, the stock has gained more than 70%. Source: SmartkarmaI have covered this situation three times since the Deal was announced (as indicated by the "①" markers in the figure above) taking a Bullish stance on all three occasions as I believed the stock was fundamentally undervalued on a growth-adjusted basis. 

Allcargo Logistics (AGLL IN): Indian Delisting Offer Trading Cheap 

Allcargo Logistics (AGLL IN): Shareholder Vote Encouraging. Buying Opportunity. 

Allcargo (AGLL IN): +42% Up So Far. How Much More to Go? 
Last week, the company announced that the Delisting Process has been "reinitiated" causing the share price to rise sharply. So what does this mean and how does this affect the timeline and the upside potential of the event?Read below to find out.  

Allcargo (AGLL IN): Process Reinitiated! 70%+ Up Now. Should You Still Chase?

<div>On 24th August 2020, India-based integrated logistics company <a href="https://www.smartkarma.com/entities/allcargo-logistics-ltd" target="_blank" data-smartkarma-citation="entities:10602:1" rel="noopener">Allcargo Logistics (AGLL IN)</a> announced they had received a “<a href="https://www.bseindia.com/xml-data/corpfiling/AttachHis/9bf60829-9be9-4e37-b6c2-234cc3203040.pdf" target="_blank" rel="noopener">Delisting Proposal Letter</a>" from members of its Promoter Group (Shashi Kiran Shetty and Talentos Entertainment Private Limited).</div><div>
The Promoters collectively hold 172.0mn shares in Allcargo representing a 70.01% stake and the Offer will be made to acquire the remaining 73.7mn shares representing a 29.99% stake.
When the Deal was announced the stock was trading at INR109.00.
In my first insight, <a href="https://www.smartkarma.com/insights/allcargo-logistics-agll-in-indian-delisting-offer-trading-cheap" target="_blank" data-smartkarma-citation="insights:43137" rel="noopener">Allcargo Logistics (AGLL IN): Indian Delisting Offer Trading Cheap</a>, I mentioned that Allcargo's multiples were inexpensive compared to peers and since the control premium at that price was insufficient, I expected "the share price to gradually move up as the Deal progresses". In October 2020, when the shares were at INR118.70, I reiterated my Bullish stance in <a href="https://www.smartkarma.com/insights/allcargo-logistics-agll-in-shareholder-vote-encouraging-buying-opportunity" target="_blank" data-smartkarma-citation="insights:44464" rel="noopener">Allcargo Logistics (AGLL IN): Shareholder Vote Encouraging. Buying Opportunity.</a> 
So far the stock has gained 42% from its undisturbed level.
With the finish line approaching, read below to find out more about the upside potential of this situation.  
</div>

On 24th August 2020, India-based integrated logistics company Allcargo Logistics (AGLL IN) announced they had received a “Delisting Proposal Letter" from members of its Promoter Group (Shashi Kiran Shetty and Talentos Entertainment Private Limited).
The Promoters collectively hold 172.0mn shares in Allcargo representing a 70.01% stake and the Offer will be made to acquire the remaining 73.7mn shares representing a 29.99% stake.
When the Deal was announced the stock was trading at INR109.00.
In my first insight, Allcargo Logistics (AGLL IN): Indian Delisting Offer Trading Cheap, I mentioned that Allcargo's multiples were inexpensive compared to peers and since the control premium at that price was insufficient, I expected "the share price to gradually move up as the Deal progresses". In October 2020, when the shares were at INR118.70, I reiterated my Bullish stance in Allcargo Logistics (AGLL IN): Shareholder Vote Encouraging. Buying Opportunity. 
So far the stock has gained 42% from its undisturbed level.
With the finish line approaching, read below to find out more about the upside potential of this situation.  


Allcargo (AGLL IN): +42% Up So Far. How Much More to Go?

India

Allcargo Logistics Limited is a full service logistics company. The Company offers specialized logistics services across multimodal transport operations, container freight station operations and project and engineering solutions.

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Allcargo Logistics (AGLL IN)

Allcargo (AGLL IN): ECUW Stake Sale at US$1bn Proposed Valuation

Allcargo Logistics saw its delisting efforts collapse a couple of weeks ago. Now they are looking to divest their international business unit to...

Janaghan Jeyakumar, CFA

The Rise of Shareholder Activism in India

Shareholder activism is on the rise in India with several recent instances where investors have raised concerns through voting rights and EGMs as...

Ankit Agrawal, CFA

Allcargo (AGLL IN): Shareholders Reject! What Now?

In a rare historical event, shareholders of India-based Allcargo Logistics have rejected the Voluntary Delisting Proposal. This is one for the...

Janaghan Jeyakumar, CFA

Allcargo (AGLL IN): Process Reinitiated! 70%+ Up Now. Should You Still Chase?

A change in SEBI regulations has caused Allcargo to reinitiate their Delisting Process. Now, there is more clarity on the event timeline and the...

Janaghan Jeyakumar, CFA

Allcargo (AGLL IN): +42% Up So Far. How Much More to Go?

The Allcargo Logistics Delisting Offer is up 42% in the past 10 months. The Launch deadline is coming closer. The stock is quite cheap to peers,...

Janaghan Jeyakumar, CFA

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