Radhakishan Damani, known as the retail king of India, who changed the retail space in India with DMart, needs no introduction. Even the super investors of India follow him and his moves closely. All while the average investors aspire to have his stock picking skills.
A true value investor who is not shaken by temporary market mood swings, Damani believes in the Warren Buffett way of buying a stock and sticking to it over the years. Currently, he holds 12 stocks in his portfolio, worth almost Rs 180,000 cr. Of course, the biggest one of them is his home turf, Avenue Supermarts Ltd (Dmart) worth over Rs 175,000 cr.What has caught the attention of many investors recently is his 2 long held high dividend yield stocks. These “cash cows” have dividend yields that make their peers envious. And both these stocks are trading near their 52-week lows, creating what could possibly be a big opportunity. But is it really?
#1 Advani Hotels: The Goa Gem Offering a 3.5% Yield
Incorporated in 1987, Advani Hotels and Resorts India Ltd is in the business of hoteliering.
With a market cap of Rs 501 cr, the company has a current dividend yield of 3.5%. The 5-year average dividend yield for the company is 3%.
The company is almost debt free and maintains a healthy dividend payout ratio of 85%.Also, the company has a current ROCE (Return on Capital Employed) of 45%, while the industry median is just 12%. In simple words, this means that for every Rs 100 the company uses as capital, it makes a profit of Rs 45 on it, while its peers in the same industry average just about 12%.
Radhakishan Damani has held a stake in the company atleast since December 2015 (as per the oldest data available in trendlyne.com), and currently holds a 4.2% stake worth Rs 21 cr.
Let’s look at the financials to see if we can find out what has kept Damani interested in the company for a decade.
The company’s sales have grown from Rs 70 cr in FY20 to Rs 107 cr in FY25, logging in a compound growth rate of 9% in the last 5 years. Between April and September 2025, the company recorded sales of Rs 35 cr.The EBITDA (earnings before interest, taxes, depreciation, and amortization) for Advani Hotels grew from Rs 17 cr in FY20 to Rs 35 cr in FY25, recording a 16% CAGR. For the quarter ending June 2025, EBITDA of Rs 3 cr was logged, but for the quarter ending September 2025, a loss of Rs 1.2 cr was recorded.
As for the net profits, the company has logged in a compound growth of 19% from Rs 11 cr in FY20 to Rs 26 cr in FY25. For the quarter ending June 2025, the net profits were Rs 2.4 cr, but for the quarter ending September 2025, the company logged losses of almost Rs 1 cr.
Hotels is a cyclical business which the third quarter being the strongest. Depending on how well the season goes for the company, one could make a call on the sustainability of the high dividend yield. Meanwhile, the share prices for Advani Hotels & Resorts India Ltd were around Rs 30 in November 2020, and as on 27th November 2025 it was Rs 54.
The company’s 52-week low is Rs 50, so the current price is remarkably close to it.
As for valuations, the company’s current PE is 20x, while the current industry median is 38x. The 10-year median PE for Advani Hotels & Resorts is however 27x and the industry median for the same period is 36x.# Zero Debt, High ROCE, Solid Dividends: 2 Gems in Radhakishan Damani’s Portfolio
**November 28, 2025** – In the art of value investing, few names command respect like Radhakishan Damani, the reclusive "Retail King" behind DMart's empire. With a net worth north of Rs 2 lakh crore, Damani's portfolio isn't about flashy growth bets – it's a masterclass in spotting resilient businesses with fortress-like balance sheets. As of late November 2025, his disclosed holdings span 12-13 stocks worth nearly Rs 1.8 lakh crore, dominated by Avenue Supermarts (DMart) at over 75% allocation. But amid the noise of market highs, two under-the-radar picks stand out: **VST Industries** and **Advani Hotels & Resorts**. Both boast zero (or near-zero) debt, ROCEs that would make Warren Buffett nod approvingly, and dividend streams steady enough to fund a lifetime of chai breaks. If you're scouting for quality compounds in a volatile D-St, these Damani darlings could be your next watchlist adds. Let's unpack why.
## Damani's Playbook: Betting on Bulletproof Balance Sheets
Damani's genius lies in simplicity: He hunts for companies with moats, minimal leverage, and cash-generating machines that reward owners reliably. No debt means no interest noose in downturns; high ROCE (Return on Capital Employed) signals efficient profit engines; and solid dividends? That's the cherry – passive income without selling a share. His portfolio's average ROCE clocks 25-30%, with debt-to-equity ratios hugging zero. In 2025's rate-cut rally, these traits shine brighter, shielding against inflation jitters and funding buybacks or expansions.
Enter our duo: VST Industries (a tobacco stalwart) and Advani Hotels (a Goa gaming hotspot). Damani's held stakes in both for years – VST since 2016 via investment vehicles, Advani unchanged at 4.2% since the same vintage. Together, they represent just 2-3% of his book but pack outsized punch for retail hunters. Over five years, VST's delivered 200%+ returns; Advani's more than doubled from pandemic lows. With Nifty at all-time highs, are these gems undervalued? Spoiler: Analysts whisper 20-30% upside.
## Gem #1: VST Industries – The Smoky Cash Cow with 30% Damani Backing
Tucked in Hyderabad, VST Industries isn't chasing ESG headlines – it's a no-frills tobacco player churning out brands like Total and Charms, with a side hustle in pan masala. Zero debt since 2003? Check. ROCE? A robust 21% (industry median match, but with fat margins). And dividends? The board's declared Rs 150/share twice in the last year alone, yielding 3-4% at current prices – a payout ratio north of 50% that's been clockwork for over a decade.
Financial snapshot as of Q2 FY26 (Sep 2025): Revenue dipped 6.6% YoY to Rs 336 crore on volume softness, but EBITDA margins held at 25%+, and PAT stayed resilient. Net cash? Rs 332 crore in short-term investments. Damani's ~30% stake (via Bright Star Investments and personal holdings) underscores conviction – he's trimmed minimally, even as shares shed 13% in six months to Rs 250. Why buy now? Rural demand rebound (tobacco's recession-proof), premiumization push, and a PE of 15x FY26 EPS (vs. peers at 20x). Brokerages like Motilal Oswal eye 25% upside to Rs 310, citing steady free cash flow for more shareholder love.
In Damani's world, VST's a "sleep well at night" bet: Predictable, lever-free, and dividend-dripping.
## Gem #2: Advani Hotels & Resorts – Goa's Debt-Free Gaming Haven
Shift gears to hospitality: Advani Hotels runs Casino Pearl and Caravela Beach Resort in Goa, tapping India's nascent gaming boom (projected $5B by 2030). Debt? Virtually nil (D/E at 0.58%, down from peaks). ROCE? Stellar at 46% for FY25, or 34% TTM – turning every rupee invested into profit fireworks. Dividends? Two payouts in FY25 (Rs 1 + Rs 0.9), yielding 3.5% on Rs 54 shares – the highest in 34 years, with an 85% payout ratio.
Q2 FY26 numbers (Sep 2025) showed a quarterly dip in sales/EBITDA (tourism seasonality), but three-year profit CAGR hits 18.5%, with ROE at 40%+. Cash reserves buffer expansions, like new Sikkim ventures. Damani's 4.2% stake? A quiet vote of faith since 2016, unchanged amid volatility. Shares have doubled from Rs 30 in Nov 2020, but trade at 8x FY26 EPS – a steal vs. sector 12x. Risks? Regulatory gaming tweaks, but tailwinds from tourism revival (Goa arrivals up 15% YoY) point to 30% pop to Rs 70, per ICICI Direct.
Advani's not flashy, but in Damani's lens, it's a high-ROCE machine printing tickets (literally) with zero debt drag.
| Metric | VST Industries | Advani Hotels & Resorts |
|--------|----------------|-------------------------|
| **Damani Stake** | ~30% | 4.2% |
| **Current Price (Nov 27, 2025)** | Rs 250 | Rs 54 |
| **Debt Status** | Zero | Near-zero (D/E 0.58%) |
| **ROCE (Recent)** | 21% | 46% (FY25) / 34% TTM |
| **Dividend Yield** | 3-4% | 3.5% |
| **5-Yr Return** | 200%+ | 80%+ |
| **P/E (FY26E)** | 15x | 8x |
| **Key Moat** | Stable tobacco demand | Gaming monopoly in Goa |
## Why These Two? Damani's Timeless Edge in 2025's Market
In a year of AI hype and smallcap froth, Damani's gems remind us: True alpha flows from fundamentals, not FOMO. VST and Advani fit his mold – low capex, high returns, and dividends that compound wealth quietly. Portfolio allocation tip: 5-10% each for balance, especially with RBI's easing cycle juicing consumer spends. Risks? Sector sins (sin taxes for VST, policy for Advani), but zero debt buys time.
As Damani quipped once (rarely), "Invest in what you understand." These aren't memes; they're machines. With Q3 earnings looming, could they spark a re-rating? Track 'em – your future self might thank you.
Bullish on Damani's picks? Or got a third gem? Hit the comments. DYOR, folks – markets reward the patient.
*Disclaimer: Not financial advice. Stock prices fluctuate; consult advisors.*
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