I think this story was over at least for minority investors even before it started. Do some google search to find out how maxwell and lovable promoters are related. While they milked maxwell, lovable was a newborn baby to start milking again. I consider it an inferior story for a longer term play compared to playing for a bounce. Page is growing aggressively in women's segments and gaining market share while this one is happy in just maintaining it. Now they want to take license route which is a classic sign of failure as they had own brands. This will be flashed repeatedly in the media as long as PE guys are invested and will be buried or get bought at some point of time.
Posts in category Value Pickr
My Portfolio – Need Suggations from Value Members (30-08-2015)
Isn't allotment of 35% for Orbit Exports on higher side? I like the business and I am invested in it. At present I believe the market it happy with the new management and it's execution of augmenting the capacity with the existing facility and efficiently managing the new facility at Kalyan. Also their aim is to reduce the outsourcing(40%). Being in fashion design space it commands higher margin on exports(60% in exports). Since you are in Textile field my question to you is the sustainability of the margin and its ability to churn out new designs every year?. Vakrangee and Jain Irrigation I read elsewhere there are some red flags. Could you please tell me about the rationale of Sarla?
30 stock ideas, need to reduce to 15 (30-08-2015)
Agree with@pjain will keep Welspun and aviod Nandan Demin
Why Airlines do not fly on Value Investing (30-08-2015)
You're using broad strokes to rule out individual investments, i.e. Mixing a top down approach with bottom up. Therein lies the problem
If you want to invest based on themes then you have to pick some trend that's taking off and in India typically we just look at what happened a decade or two ago in developed markets and extrapolate that. Mobile phones, airlines, cars, etc.
But the bottom up analysis shuns the industry averages and looks at the individual players to determine their strengths. Nearly all the profits in the enormous mobile phone industry are captured by just one player - Apple. Now you can't say that Apple is a bad investment just because nearly every single player is bleeding money.
So as a macro, airlines are a bad business, as a bottom up approach, generalizing it to "every airline is a bad business" will be an enormous fallacy.
Lovable lingerie – poor man’s Page industries (30-08-2015)
Perhaps I have not been as clear in my post as I had hoped to be.
I am not talking about a bounce. I am talking about a bottom formation and a sustained uptrend which would follow. This uptrend will be backed by both fundamentals (improving sales, margins, and Adidas ) as well as technical.
Don't buy it for a bounce, but consider buying it for long term holding in your portfolio. And buy it precisely because it has gone nowhere in the past so many years and .....because it may go up a lot in the coming years.
I rest my case; the decision is yours. Pl do as you deem fit and proper.
30 stock ideas, need to reduce to 15 (30-08-2015)
I would definitely keep Welspun among the textile names.. The stock has a lot of upside potential given the capacity expansion...Not sure on the others textile names as I don't track them ...
Would definitely keep Granules and DHFL ....
Lovable lingerie – poor man’s Page industries (30-08-2015)
It has gone nowhere during the last many yrs and why would somebody be interested in it? for a bounce?? there could be better stories even for a bounce.
Lovable lingerie – poor man’s Page industries (30-08-2015)
Recently the Management in an interview has given clarifications on some of the issues:
1) The margins are to be in the range of 15% in the next few quarters.
2) Production from the tie up with Adidas will start coming into the market from Dec 2015 onwards.
3) The company has maintained its market rate of 20% in the premium lovable brand.
4) They do not see online retail as a threat but as an opportunity to expand the distribution of their products.
This is basically a consumption story...as the economy grows and as disposable incomes rise, more and more women will go for branded lingerie. The progress of this company cannot be monitored on a quarter to quarter basis except to use any price fall to add more to the portfolio. This is a long gestation stock and requires quite some time to bloom ...but the returns for the patient investors can be quite huge.
A better way of monitoring the progress would be with the help of long term charts - Monthly and weekly. And on both this charts the stock is showing clear signs of bottom formation and turnaround.
For making purchase the two trend lines ( dealing with earlier lows and the present low points) present a very good entry guidelines for those making their first purchase in Lovabe Lingerie..
Those making the purchase according to these trendlines can take huge comfort from the fact that they are purchasing a company with immense potential, one in which reputed value investors hold a good quantity at a much higher price ,,,,at a very good price and at a time when the bottom formation process appears to be over and the risk reward ratio favours investors.
A good company with very good fundamentals and at a technically very good price...Highly recommended even in this turbulent market.
Paushak Ltd. – Alembic’s agrochemical business (30-08-2015)
So I went through the list of questions again and these are the responses I got from talking to the company to some similar questions:
1) What percentage of sales is from exports? - The company's sales vary largely depending on the orders without any particular trend/predictability of exports/domestic sales. They aren't contract manufacturers so their orders depend on customer's demand.
2) They were fairly resistent to giving out information about products since their products are specialized formulations developed by them. However, their isn't any particular thing stopping their competitors to develop the same products (no patents/IP rights)