One of the issues Whirlpool India has is that group allows them to only make products for India ? With dilution , and depending on who is the buyer offcourse we can hope that WIL will have greater freedom to supply as contract partner to more locations outside as well as have more choices to manage costs in business decisions. Who ever is acquiring parent stake is not going to sit …they will excert pressure to relaease value and push them to deliver more results
Posts in category Value Pickr
Rural Elect Corp (07-12-2023)
I would not necessarily agree with the fact that IREDA should get a premium.
The real opportunity is in financing the utility scale projects for a longer term (otherwise, it gets refinanced through foreign borrowing) – therefore, cost of the funds is crucial in this business. As far as financing the RE sector is concerned, PFC/REC have been in the business for long and understand its nuances well. Infact, financing state thermal sector is better as they are cost plus and don’t have re-financing risk – these contracts are also long term and have implicit or explicit state guarantee (which makes them virtually an arbitrage business).
Have been in the Power Sector for a long period and can say they have good people assessing the projects…
Disclosure: Have been invested in both PFC/REC for 4-5 yrs
Cineline India – Picture abhi baaki hai (07-12-2023)
Have been following the company for a year now
Two issues that have to be looked upon
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Monetization: If you look at the investor presentation for the past 2-3 quarters there is a slide that is missing
It was a major part of my thesis, bottomline will keep on suffering due to delay in monetization of this.
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Growth: This year they added only 1 property and 3 screen as compared to 17 and 61, again if the monetization happens the expansion can happen at much faster pace.
Growth was majority driven by box-office number than expansion
Disclosure: Invested
Phantom Digital Effects Limited (07-12-2023)
VFX is a type of knowledge work. Generative AI revolution will impact all knowledge work. Each engineer/VFX artist’s productivity goes up 10x, thought another way, companies either need 10x lower engineers or need to do 10x more output to justify having that many engineers/VFX artists. Think about it from any company’s perspective. They would try to leverage existing staff for higher/faster growth. Execution times would go down. More movies would release every year.
But the most likely outcome is something in middle, each engineer/artist does 3x more work but companies need 3x fewer engineers/artists. This is going to be hugely disruptive. At same time, the need for a VFX company does not go away. Rather, VFX becomes central to the movie. Rather than VFX being a way to enhance a movie, each movie would become an animation movie with reality level graphics in each movie. Most large tech studios would want to build these capabilities in-house, the likes of disney, marvel, DC. Even red chilli entertainment would build this capability in-house using red chilli VFX. But just imagine, would each production house be in a position to do same. Is it the core competence for production houses like KJR, Karan johar, yash raj to deploy cutting edge AI/ML technologies? I dont think it is. The question of what to outsource & what to do in-house would critically define different types of production houses.
Two things are for sure imo:
- Entry barrier for long format entertainment targetted creative videos goes down dramatically. we would have an explosion of movies & long format videos. You could make a movie, i could make a movie, each of us could create our own production houses, create movies with generative AI & distribute it on YouTube.
- Imagine yash raj studios licensing SRK’s digital avatar for 50 cr & then spending about 10cr on VFX and boom they have a 60cr pre-distribution SRK movie made. No more fancy shooting locations, no more studios, everything is rendered from the script as video by GenAI models.
Disclaimer: recently sold out, following balance sheet deterioration in Sep-23 but watching this space very closely. (management didnt walk the talk on other current asset & receivables reduction).
Phantom Digital Effects Limited (07-12-2023)
Have seen a lot of extremely stupid and obstinate opinions going around on twitter that AI will kill these companies. Reminds me recent opinions in aftermath of chatGPT that it will eradicate software engineers. Laughable at best. If this causes a slow decline in stock price, I would be very interested.
Movies are an art medium. A slightly different direction angle angle, tone, color , background makes all the difference in the world. People go to theatres to watch movies. This is not about generating a low quality YouTube video.
I am a software engineer so I don’t have credentials but agathodaemon does. And I second him.
Force Motors – racing ahead! (07-12-2023)
CHIEF MINISTER YOGI ADITYANATH FLAGGED OFF 352 AMBULANCE AND ADVANCED LIFE SUPPORT (ALS) AMBULANCE UNDER
Sigachi Industries Limited (07-12-2023)
Accent Microcell – Indian Competitor for Sigachi is listing this month.
Navneet Publications – a good com in education sector (07-12-2023)
Valuation is highly subjective. The cashflows you are considering “risky”, do not seem risky to me. Students are going to buy books year after year in the respective states. Stationary sales are also robust and growing. I have used a very conservative growth rate despite NEP tailwinds and the 800Cr stake in K12 techno which may be sold in the next 2-3 years. That is a direct inflow to profits. One can use RFR and add to it all kinds of premiums (CSRP, Size premium etc., fellow Investment Bankers would be aware of these terms) and find out the WACC but that does not capture risk imo.