Joyous scenes at Dalal Street after Sensex breaches ATH of 40,000
Sonia Shenoy is known to be the harbinger of good news.
Yesterday, she highlighted the fact that we are within touching distance of the record high on the Nifty.
She also pointed out that the FIIs and DIIs are buying aggressively in the wake of expectations that NAMO and Nirmala Sitharaman will rationalize taxes on capital gains and shower benefits on investors.
nifty @ 4 mnth high,316 pts away from record high
FIIs buy 876cr,DIIs buy 145cr in cash market
ICICI Bank, RIL, HUL at fresh highs
sources indicate govt reviewing equity related tax rate rationalisation
— Sonia Shenoy (@_soniashenoy) October 30, 2019
Indeed, Sonia’s prediction came true today because the Sensex effortlessly crossed the barrier of 40,000.
#CNBCTV18Market | #Sensex reclaims 40,000, trades at 4-month high pic.twitter.com/xLhRXIYyxn
— CNBC-TV18 (@CNBCTV18Live) October 30, 2019
Novices and veterans thronged the streets of Dalal Street, dancing and singing with joy, their pockets bulging with massive gains.
(Dalal Street punters celebrate Sensex 40000)
Gloom in another section
However, in sharp contrast to the celebratory mood in one section of Dalal Street, there was a mood of despondency in another.
Porinju Veliyath and his army of followers were in a particularly bad mood.
This is because ZEE Media, one of Porinju’s all-time favourite stocks, sunk like a stone and attained the dubious status of a penny stock.
It may be recalled that Porinju had publicly recommended ZEE Media in October 2017 as a “Diwali Pataka” Gift to us.
#CNBCTV18Exclusive| Ace stock picker @porinju is positive on Zee Media for Samvat 2074 pic.twitter.com/0x4LMZzQii
— CNBC-TV18 News (@CNBCTV18News) October 17, 2017
At that time, Porinju’s logic was flawless, namely, that given the dominance of the Company in the media space and the insatiable demand for entertainment and news in the Country, the stock would do well and deliver multibagger gains.
He also bought a big chunk of the stock for his own portfolio and for that of his distinguished PMS clients.
. @porinju adds 8.72 lac shares of Zee Media. Takes his holding in the company to 5.09 % (24 million shares). Stock +7%.
— Kush Katakia (@kushkatakia) January 3, 2018
Initially, the stock lived up to expectations and delivered handsome gains.
Sir. Today iam really excited of you because I made 20% on your fav stock. ZEE MEDIA. God bless you.
— S.M Nagarajan (@smnagarajan) July 20, 2018
Zee Media is available at 7x FY19 EBIDTA. One of the cheapest media stocks & that too from a bellwether media house. TV/Online shopping could add to valuations. Make no mistake, Porinju has done his homework on this one & is all set for multibagger returns.
— Rajat Sethi (@_rajatsethi) January 3, 2018
However, it thereafter ran into heavy weather.
The promoters pledged their stock to raise funds for Essel Infra.
When the Essel project floundered and sank like a stone, the lenders had no option but to dump the pledged stock in a fire sale.
This sent ZEE Media plunging.
#AskPorinju | Porinju's take on Zee Media: @AyeshaFaridi1 @avannedubash @porinju pic.twitter.com/9ptSaG3VFz
— ET NOW (@ETNOWlive) March 12, 2019
Subhash Chandra, the boss man of the ZEE group, issued a public apology with regard to the fiasco.
However, his apology was of little solace to the beleaguered investors who had invested in the junk stock and lost their life savings.
.@subhashchandra Writes Open Letter To Bankers, NBFCs & MFs
Subhash Chandra Apologises For Not Living Up To Their Expectations Despite Best Intentions pic.twitter.com/WpAyFmWPZY
— BTVI Live (@BTVI) January 25, 2019
SEBI should ban pledges by promoters
In the wake of the ZEE fiasco, Porinju has canvassed the theory that the root cause of all evil is the pledging of shares by promoters.
He has claimed that the pledge provides unscrupulous promoters with an efficient tool to siphon off the wealth of banks and minority shareholders and make a clean exit from the company.
High time India ban pledge of promoter stake in listed companies. Pledge has been an efficient tool to siphon off the wealth of both banks & minority shareholders in a single shot and take a clean exit! @PMOIndia @SEBI_India @nsitharaman @FinMinIndia
— Porinju Veliyath (@porinju) October 16, 2019
Porinju’s theory is supported by several intellectuals amongst his followers though some oppose it.
Absolutely agree. This is how they been looting money. HEG did buyback at 5500 and share price is now 900.biggest fraud and corruption are been done by listed companies. Leel Manpasand Indiabulls Dhfl Pc jewellers Vakrangee list is endless. There is no regulator. Insider trading.
— Arun (@arundpp) October 16, 2019
What Kushagra Bajaj,CMD Bajaj Consumer,did yesterday was height of shamelessness.
First he sold 13% of his holding to feed a highly risky business, When he started losing he pledged 62%, then sold his entire unpledged holding(22%) in a single day due to exigency. Shame! Shame!
— Satyen Sinha (@satyenhbti) October 16, 2019
Just because few entities misuse this route , why should honest one using this route for right purpose should suffer??? Investor who lost money due to their own fault might be finding excuse to hide under this reason!
— Amarnath Bhakat (@AmarnathBhakat) October 16, 2019
should ask for transparency or solution… pledge ban won't solve the problem – although what benefit to promoter for listed if stake/shares cannot be pledge for funds
— Vikram Pathak (@vikram_bajar) October 16, 2019
Promoter’s attitude is ‘shady‘, Lenders should find strategic buyer and not dump stock on street
Porinju has now lamented that ZEE Media is at a “historic low” despite reporting highest-ever operating profits.
He alleged that the promoters have cashed out by pledging at high prices and are continuing to torment minority investors by refusing to give up control.
He described the attitude as “shady” and alleged that the failure of Essel Infra was a pretext and not genuine.
Zee Med -Rs 5. Historic low after reporting highest-ever Op Profits. Promoters cashed out by pledging at high prices and continue to torment min investors by refusing to give up control? Shady attitude signaling group's Infra-failure isn't genuine? We hold.@punitgoenka @PMOIndia
— Porinju Veliyath (@porinju) October 30, 2019
He also slammed the lenders for not making the effort to find a strategic buyer and instead dumping the stock in a fire sale.
He alleged that the lenders may also be party to the “conspiracy to loot shareholders“.
Wonder what drives institutions like @IFCI_LTD @rblbank STCI etc. who lend against shares! Why not find a strategic buyer @ 2000 Cr than throwing away in the market @ 200 Cr? Or, are they too party to the conspiracy to loot shareholders?
Urg attn: @FinMinIndia @RBI @SEBI_India
— Porinju Veliyath (@porinju) October 30, 2019
Porinju also skirmished with the promoters of LEEL
Porinju is well known for his fearless and outspoken attitude.
He does not hesitate to pull up promoters if he feels they are in the wrong.
In the case of LEEL, where investors lost 100% of their capital due to the shenanigans of the promoters, Porinju blasted the promoters for committing “daylight robbery“.
However, the promoters, unscrupulous to the core, counter-attacked him and alleged that he is “intentionally deflating the stock price“.
SEBI is looking into the matter and the present status is not known.
Leel Electricals feels that well-known investor Porinju Veliyath is intentionally deflating the company's stock & wants SEBI to pass a restraining order against him till the probe into alleged siphoning of funds from the company is completed. My story.https://t.co/ftVQFyeSRL
— Ashish Rukhaiyar (@ashishrukhaiyar) June 5, 2019
Zee’s cheap valuations are a travesty?
At this stage, we have to take note of the opinion of Manish Chokhani, the stock wizard, that the cheap valuations at which large media companies like ZEE, SUN TV, Network 18 are quoting is a “travesty“.
“If I add up Zee, Sun and Network 18, that is 50% of the eyeballs of India, in aggregate the market cap of these three is less than $7 billion,” Manish has pointed out and hinted that the bargain basement pricing may not remain for long!
I do not know if anybody even watches Zee these days. If i know the management is shady then i do not invest someone else money in those stocks as that would raise a question mark on my integrity too. So i have stayed away from all these chor companies.
We all know that reliance group is trying to destroy terrific company like zee , with direct or indirect support of govt.
Atleast we have honest management trying to repay all debts. There should be enquiry in this matter and hammering of zee shares as pointed by Mr Chandra in his tweet
Govt collects taxes and bails out Shady Lending PSU Banks . These promoters pledge their shares and retails investors are stock. Nobody is protecting interest of middle class and minority shareholders.What happened to Swiss bank money? Where is Mallya and Nirav modi?
What surprises me is that PV finds one reason or other to be in the news inspite of his stocks sliding big time. I can’t imagine that he is blaming now lenders and asking SEBI to ban pledge of shares and so on.
Is this the same Porinju who was singing praises about the present Govt , the leadership , the infrastructure, etc etc, all the wah wah. What happened to him now??.
Porinju has made his money. Now some got stuck so he is finding excuses. He is a farce and misleading advisor
Why cry now ! Why deal with such people? Do better research!
PV does not have enough money in all these small cap companies he owns. These are all his fat finger trades to create some noise. He might just have 1 or 2% of his AUM in all these small companies that he recommends. The people who have lost out big time are his followers who look for his block deal or recommendation in TV’s . Hope they have learnt their lesson. They need to know where the 90% of his AUM is and not 1% to 2%.
Very true he is pretending to be Carl Icahn by investing 1cr or 2 cr in these chor companies.He just wants to seek attention!
Absurdity at its height.
Not suitable for a respected investor like PV.
I dont think there is anyabsurdity in what she has said? Why dont you prove it with data? What percentage of AUM of Equity Intelligence was invested in LEEL or ZEE? Why cry fowl now when you were advocating to invest in Chor Companies ? Why should the PMO intervene in these matters? If there is anything fraudulent,file a complaint it to the SEBI with facts? Why just tweet about it?
Sorry, my comments were wrongly understood. When I said absurdity at its height, what I meant was that it was it was PV’s absurdity to have invested in such chor companies and top of that going to the entire town telling about his investment in these chor companies. May be manipulation is the angle.
If you are following PMS performance reported in ET etc, it was continuously down each quarter for the last 2 years. Unfortunately he took big stakes in chor companies and all his customers are suffering.
This blog is too obsessed with this guy who is never in the league of RJ.Please stop covering his rantings!
i am client of porinju and suffering with pain.All stocks whether he recommended on tv or purchased for their clients are junk.just recollect his recommendation ie gvk power , adlabs, anantraj,ashapuraminichem,hcl infosystem, leel,emkay global,kaya, and many more or in short every stock recommended by him. i will request all of you not to follow him.
Porinju investment funds has just got wrong and whoever invested in his PMS orfollowed him are sitting duck. Why this guy speak so highly about him and missguides readers. Stay away from funds of Porinju , you will definitely lose your money.
PV has burnt his fingers very badly. I recall many posts and NSE data of companies where PV’s holdings was above 5%. Even in his portfolio – LEEL, Kaya, Zee and some water treatment company used to be crown jewel with highest holdings. All of them have lost 80%-95% value since 2018 beginning. PV has lost real money, for himself and his clients. He has also written apology letters to his clients. Same is the story with Mohnish Pabrai & Dolly Khanna. Their crown jewel Rain Industries have backfired and it has lost 78% value in last 2 years. Risk managment is key in equity investing. Never get carried away with recommendations of these so called Guru’s. No matter how promising the growth story of stock is, never invest more than 5% in single stock. Better to preserve capital than senseless hunting of multi-baggers.