Cortina Holdings is a distributor and retailer of luxury watches like Rolex, Patek Phillipe, and Tag Heuer. Established in 1972, Cortina has now grown to 28 outlets in Singapore, Malaysia, Thailand, Hong Kong, and Taiwan. Since its peak in September 2018, Cortina’s share price has fallen 12% to 95 cents currently: As I was going through Cortina’s latest financial statements, something jumped out at me – the company’s net current assets are worth more than its entire market capitalisation right now.

Net-net investing

Net-net investing was developed by Benjamin Graham (the mentor of a certain Warren Buffett) who preached that investors who bought stocks at such low prices would come out ahead, even if the company was shut down and liquidated. A net-net stock is traditionally defined as a company with a market capitalization that is less than the company’s current assets minus total liabilities. Expressed as a formula, it ......