Redington Ltd.

“Redington trades at a genuinely undemanding 8.8x forward P/E near multi-year lows, and operates as India's dominant IT distributor with real structural tailwinds from digitalization. However, the business is permanently disadvantaged by 1-2% net margins, a narrowing competitive moat as cloud vendors disintermediate distribution, recurring Turkey FX losses, and a promoter-competitor governance conflict with TD SYNNEX. The base-case 10-year return of 2-3x (~10-12% CAGR) is achievable but not compelling relative to higher-quality businesses available at modest premiums. Cheap starting valuation does not transform a structurally eroding intermediary into a long-term compounder; conviction is insufficient to recommend active capital allocation.”