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What to do with Dewan Housing Financing Holdings?

Current Situation of Dewan Housing

Dewan Housing is undergoing Debt Pressure to due Defaulted ILFS, Reliance Capital customers.

Credit Rating been degraded.
The stock has undergone 90% crash as of now on back of Negativity News.

Current Solutions

There are Private Equity funds coming forward to resolve the matter. It can take couple of months/quarters to resolve the problems completely.

Promoters sold subsidiary shares in raising capitals

Promoters are ready to sell more stakes to clear the dues.

AION Capital may invest in DHFL. News

Current Investors - Should I Sell?

No point in Selling now as the Major Crash happened.

Hold for long term.

Opportunity Factors - Should I Buy?

Few good observations are:

  • PE ratio is at 1.5 - Huge Undervalued
  • P&L has not reported losses yet. Not even for quarters
  • Stock crashed below Book Value of 75% - Huge Undervalued
  • Company is trading at 7% Dividend Yield levels.
  • Debt to Equity is at 4X levels
  • No Pledging of Shares

All these shows that the Company is Deeply Under-valued If the problems will get resolved.

One can expect a 10X returns in next 5 years if the problems are resolved.  

If not resolved, then the Capital Loss is anticipated.

However, take your own Judgement before Buying!

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