With due respect to the comments, i dont want to hold funds in which fund manager has changed, thats too much risk. is there another fund with a good fund manager as a replacement. I am not in a hurry but i want to be out sooner then later
Posts in category Value Pickr
Vivek Gautam Portfolio (12-09-2015)
Santosh How do u calculate YTD returns? I havent gone into much details for it but after your prodding I checked on Moneycontrol which is giving a yearly return of 44%.But several of buys have been recent less then a year.
Yes after PF appreciation preservation of PF gains is also important so diversification becomes necessary imho.
TCS is the only largecap anchor stock in my PF but I hv been holding it since IPO @ 212 in 2004.If we take international context the opp size remains big.Reasons for investing in TCS i have explained earlier in the thread.
Mayur story remains intact due to increasing high margin exports both OEM and in general from low margin footwear,foray into lucrative B2C, high ROCE business under ethical promoter with execution .
Marksans is play on a promoter in right age (in 40s) out to prove himself with growth mindset,operating in lucrative niche segment with less FDA issues,timely acquisitions,amongst the few players n softgel segment,attractive mktcap vs opp size,exceptionally high return ratios.
Santosh why are you not so positive on kaveri?Shudnt we focus on next 1-2 years growth prospects n not be dismayed by a bad qtr which is infact 80% of full year for kaveri?
Srikanth VRL promoter is real smart.he sold of kannada paper to TOI at a high margin,Started another Kannada paper and brought back most of the staff from TOI. Giving a kick to a giant like TOI shows guts.yes he is 4 times ex BJP MP but I take it as a positive with central govt of BJP.
Byke hospitality – Truly asset light? (12-09-2015)
Byke , Oyo are significantly small in size compared to the huge but fragmented market size. Several years of growth opportunities are available. There is enough room for lots of players .
Bykes management in a analyst meet said they are confident of fending of competition from online players because of the high manual intervention still necessary in the room aggregation business.
Oyo's start up story is really inspiring. Its simplistic standardization is refreshing. But going through the reviews you would find what byke means by requirement for 'manual intervention'.
Byke hospitality – Truly asset light? (12-09-2015)
Byke , Oyo are significantly small in size compared to the huge but fragmented market size. Several years of growth opportunities are available. There is enough room for lots of players .
Bykes management in a analyst meet said they are confident of fending of competition from online players because of the high manual intervention still necessary in the room aggregation business.
Oyo's start up story is really inspiring. Its simplistic standardization is refreshing. But going through the reviews you would find what byke means by requirement for 'manual intervention'.
NGL Fine Chem-Re Rating Possible? (12-09-2015)
Hello All,
I attended the AGM of NGL Fine y'day and here are my key takeaways,
- The co. is not looking to add products aggressively,will commercialise two products its been working on for almost a year,one each in Human API and Vet API.
- End-use of Vet APIs is targeted towards Cattle.
- The co. is focused on products that've a small market size,it doesn't want to focus on areas where biggies would enter. It's happy to have 15-20-25% type market share in products with market size of 15-20-25 or roughly 50 crs. One of its products contributed 20-22.5 cr sales out of total sales in fy15 and the rest was from other 10-12 products. It has maximum 6-7 competitors in each product category and the market size along with competitive structure has remained static.
- New products are also selected on the basis of small size that would discourage biggies to enter and that belong to chemical family of existing products,not on the basis of opportunity size or scope for higher margins.
- The co. faces competition from China in Animal API space apart from Sequent (Alivira) and Omkar (Lasa) in India and a couple of other small players. The co. is unfazed about yuan devaluation.
- Pricing for some products is done on contractual basis and some products are priced as per prevailing prices in the market. Margins would be in the range of 13%-18%,the range indicating worst and best times.
- Top 10 customers contribute around 40% of the revenues,Top 5 contribute around 25%. All sales of co.'s products are to non-regulated markets directly or may be routed through a distributor based in another country. LatAm,Africa,SEA and neighbouring Indian countries are main end-user markets,the co. exports to 35 odd countries in total. Co. sells to 4/10 top Animal Health formulations cos. Majority of sales done in India are for Human APIs.
- The co. plans to do a CAPEX of 20 crs. in 1-2 years to install an R&D facility and expand capacity by 40%. Current R&D facility has 10 employees,2 PhDs,needs new facility to do more work.
- Management doesn't like to think in terms of long-term vision or goals,thinks in terms of 1-2-3 year time-frame. It expects to grow at around 15-18% types rate at best. The co. became big in last 10 years due to expansion in market size of its products which were very tiny at that point in time. Further,growth will not come from expansion in market size of existing products significantly but by addition of new products,which the co. plans to do slow and steady.
Overall,I found the Management quite conservative,looking to maintain existing position more than growing.
P.S. - The management also intends to develop a new product for paints industry,its entered into a tripartite agreement with two British cos,the product is just a gamble on some regulatory change envisaged in near future,will be a new line of business if things work and will put up separate capacity for the same but at the moment its just a wild bet. Missed knowing if the product is being developed for international or local market.
Disc. - No investments in the co.
Prof. Sanjay Bakshi’s Lecture link (12-09-2015)
I have learnt a helluva lot from Prof Bakshi, and for free 
I viewed through this talk and there is something striking about this, not only from an investment learning perspective but also on how various propositions are made. It often occurs to me that there are many ways one gets convinced about various propositions or arguments.
There are of course deductive arguments which if sound and valid are true beyond doubt. The field of mathematics works only on deductive arguments with some starting axioms.
Then there are inductive arguments where the conclusion does not always follow from the premises but is by and large true. Inductive arguments are risky because while they do a job of making a lot of sense, acting on inductive validated arguments can fail at times, under certain circumstances and in fact fail even randomly. For instance when a grocer runs a firesale of yesterday's oranges, you pick an orange or two from the heap and then decide whether it is worth buying at the price or not. If you decide either to buy or to discard the heap your conclusion may or may not be true. And you know that.
Most of life including investing (even including physical sciences) is driven by inductive based judgements, if you will. The art therefore is to know which to believe and which to discard. For instance if I always get-up before sun rise I can claim the sun rises only because I get up. You know it is absurd but then unless you can set-up an experiment to falsify it you will have to accept what I say because you cannot disprove it. (BTW charlatans work that way)
So can we learn the art, so we may know what to believe and what not to? The answer is an 'inductive' yes Broadly the inductive arguments can be strong or weak; based on valid evidence, generalization, application, from analogy, an inference to the best explanation and so forth. There are also fallacies or common flaws that weaken an inductive argument. Some of them include what are called ad-hominem arguments - attack the person instead of the argument, and what is relevant here - which is "appeals to authority" . An 'appeals to authority' argument makes the case that a so-and-so has said it, so the argument must be valid.
Now, coming to the point, what I found striking about the talk was that nearly all the propositions were based on 'appeals to authority'. Either Charlie or Buffett or an author or Ben G etc have said it so it must be valid.
Warm regards,
Sources on arguments:
- Coursera.org course on: Think again: How to reason and argue.
- Probability and inductive logic by Ian Hacking
Vivek Gautam Portfolio (12-09-2015)
Great going @Vivek_6954.
Thanks for sharing your PF details.
Your PF has large number of stocks and is well diversified. Core stocks seems like good long term compounders. I think last few yrs has been really good for your PF. Its a good strategy to diversify for wealth preservation and grow steadily with limited down side as PF size grows.
I have a very concentrated PF. I am very much interested in your PF returns, YTD, Jan to Sept, this is just for academic purpose, if you can share , also 1 yr return, as I wish to evaluate conc vs diversified PF strategy both in good and bad times of market.
I think you can reduce no of stocks going forward, Gareware seems to be a great pick, but you can reduce TCS and Mayur, kaveri.
Vivek Gautam Portfolio (12-09-2015)
Vivek trust you know best of the choices but just wanted to highlight of VRL's promoters after going through their DRHP..
"One of the promoters Dr. Vijay Sankeshwar has outstanding criminal court cases and other directors are also facing certain tax and legal proceedings."
Plus the promoters also come from a political background... So really i would be taking the management credentials with a pinch of salt...
Regards
Sreekanth
Forensics and the art of triangulation (12-09-2015)
Hi Mahesh,
There is no sure shot way of finding out vendor overinvoicing I know of. There maybe some rules of thumb. Earlier, until 2011, you would get quantity of raw materials used and you can find per unit costs to see if it is in line with market. But then what is to stop them from taking it out via rent and 'other misc. expenses'. So you may want to see longitudinally if there is any line item out of line over time, in relation to sales.
Ultimately these show up in Return on Equity computed as Net Profits divided by Opening Net Worth for the year, and see it over time, esp in businesses that make and sell products, for over say two business cycles.
Warm regards,
Vivek Gautam Portfolio (11-09-2015)
Thanks for sharing. What is the trigger for Marksans?