Saturday, August 30, 2008
With personal account deposit bank of $1500 billion in foreign reserve which have been misappropriated, an amount 13 times larger than the country's foreign debt, one needs to rethink if India is a poor country?.
CJ: Ramesh Manghirmalani , 13 Jul 2008 Views:8055 Comments:26
DISHONEST INDUSTRIALISTS, scandalous politicians and corrupt IAS, IRS, IPS officers have deposited in foreign banks in their illegal personal accounts a sum of about $ 1500 billion, which have been misappropriated by them. This amount is about 13 times larger than the country’s foreign debt. With this amount 45 crore poor people can get Rs 1,00,000 each. This huge amount has been appropriated from the people of India by exploiting and betraying them.Once this huge amount of black money and property comes back to India, the entire foreign debt can be repaid in 24 hours. After paying the entire foreign debt, we will have surplus amount, almost 12 times larger than the foreign debt. If this surplus amount is invested in earning interest, the amount of interest will be more than the annual budget of the Central government. So even if all the taxes are abolished, then also the Central government will be able to maintain the country very comfortably.Some 80,000 people travel to Switzerland every year, of whom 25,000 travel very frequently. “Obviously, these people won’t be tourists. They must be travelling there for some other reason,” believes an official involved in tracking illegal money. And, clearly, he isn’t referring to the commerce ministry bureaucrats who’ve been flitting in and out of Geneva ever since the World Trade Organisation (WTO) negotiations went into a tailspin!Just read the following details and note how these dishonest industrialists, scandalous politicians, corrupt officers, cricketers, film actors, illegal sex trade and protected wildlife operators, to name just a few, sucked this country’s wealth and prosperity. This may be the picture of deposits in Swiss banks only. What about other international banks?Black money in Swiss banks -- Swiss Banking Association report, 2006 details bank deposits in the territory of Switzerland by nationals of following countries:Top five
India---- $1456 billion
Russia---$ 470 billion
Ukraine- $100 billion
China-----$ 96 billion
Now do the maths - India with $1456 billion or $1.4 trillion has more money in Swiss banks than rest of the world combined. Public loot since 1947: Can we bring back our money? It is one of the biggest loots witnessed by mankind -- the loot of the Aam Aadmi (common man) since 1947, by his brethren occupying public office. It has been orchestrated by politicians, bureaucrats and some businessmen. The list is almost all-encompassing. No wonder, everyone in India loots with impunity and without any fear.What is even more depressing in that this ill-gotten wealth of ours has been stashed away abroad into secret bank accounts located in some of the world’s best known tax havens. And to that extent the Indian economy has been stripped of its wealth. Ordinary Indians may not be exactly aware of how such secret accounts operate and what are the rules and regulations that go on to govern such tax havens. However, one may well be aware of ’Swiss bank accounts,’ the shorthand for murky dealings, secrecy and of course pilferage from developing countries into rich developed ones.In fact, some finance experts and economists believe tax havens to be a conspiracy of the western world against the poor countries. By allowing the proliferation of tax havens in the twentieth century, the western world explicitly encourages the movement of scarce capital from the developing countries to the rich.In March 2005, the Tax Justice Network (TJN) published a research finding demonstrating that $11.5 trillion of personal wealth was held offshore by rich individuals across the globe. The findings estimated that a large proportion of this wealth was managed from some 70 tax havens.Further, augmenting these studies of TJN, Raymond Baker -- in his widely celebrated book titled ’Capitalism’s Achilles Heel: Dirty Money and How to Renew the Free Market System’ -- estimates that at least $5 trillion have been shifted out of poorer countries to the West since the mid-1970.
It is further estimated by experts that one per cent of the world’s population holds more than 57 per cent of total global wealth, routing it invariably through these tax havens. How much of this is from India is anybody’s guess.What is to be noted here is that most of the wealth of Indians parked in these tax havens is illegitimate money acquired through corrupt means. Naturally, the secrecy associated with the bank accounts in such places is central to the issue, not their low tax rates as the term ’tax havens’ suggests. Remember Bofors and how India could not trace the ultimate beneficiary of those transactions because of the secrecy associated with these bank accounts? IS THERE ANY ONE WHO WOULD SAVE INDIA ?God... No No No, even he can’t..........!!
No Comments.....Lol.....from me...it is all here....
Sunday, August 24, 2008
I came to know that RJ was going to speak in a seminar at Hydrabad on 22nd Aug.I asked some of my friends who lives in Hydrabad if they can attend the meet I would like to read the excerpts.
One of my friend attended the meet .I am pasting Ditto the copy here and would like to have more info if anything then this....
The Seminar was titled "Sensational Sensex - Retrospect & Prospect"
The Room was packed and pindrop silence ensued while his speech was on. Some interesting insights from RJ followed.
He gave a Powerpoint Presenation on GDP, India's Potential, Savings rate etc..and a lot of comparison & similarities between markets and wine/women.
RJ - Personal FACTS
1) I love Hyderabad and its Biryani. If my wife agrees, I wish to settle down in Hyderabad.
2) RJ said that his father expired 3-4 weeks ago, so the tonsured head. His father never asked him about his wealth, the only thing he always asked was about his charity.
3) RJ does a lot of charity and contributes to educational NGOs, but said he doesn't want to share or disclose it in the public.
4) His MOM always asks him to buy a flat or land, but RJ said he is 100% invested into equity.
Synopsis of the seminar
1) Worst Times are the BEST Times to buy.
2) Every Crisis presents an OPPOrtunity
3) At 21 PE and with no scam, this market looks ripe for a BOom...when he cannot SAY. ( No Scam , ripe to Boom....I am saying this since long)
4) The only thing India has and what Russia and China do not have is DEMOCRACY. He gave the examle of Yukos oil Company in Russia which was taken back by their Govt from the promoter.
5) RJ -"I LOVE WHISKY and WOMEN"
6) I am bearish on US markets and for them to SURVIVE, they have no CHOICE but to Invest in the EMERGING MARKETS .( Again I have written this many many times)
7) RJ - BULLISH ON OIL, GAS and IT. FERTILISER IS A BIG "NO" from RJ
RJ On OIL, GAS
1) India imports 72% of itys total consumption of oil.
2) Oil imports constitute 10% of GDP
3) GAS supply to DOUBLE from 104 mmscmd to 260 mmscmd.
4) New GAS finds could BRING savings of about $148 Billion by FY 2012. Here he quoted about Cairn finds and KG basin finds.
5) Gas could replace ~51 mmtpa (million metric tonnes per annum) which is ~ 35% of the OIL consumption of India by FY 2012
RJ - WHEN DO I SELL
When to sell a share depends upon one's need, the opportunity at hand and experience. I sell ONLY when...
a) I need money for major expense.
b) when I find there is a BIGGER opportunity somewhere else
c) when I feel that in future, a company I invested in, has no higher profit earnings potential or when the profits have peaked out.
POTENTIAL CATALYSTS for INDIA's GROWTH
a) Large wastage needs to be prevented and logistic challenges (Crisis or opportunity)
b) An agricultural Revolution is not only IMPERATIVE, it is INEVITABLE.
c) Seed companies continue to do well
RJ on Warren Buffet & USA
1) WB gave a compouded yield of 23%.
2) Indians get scared if anything bad happens in USA. In my View, I wouldn't give that much importance to USA. Their inflation is higher than ours and they live in debt. Here he quotes
"I wouldn't believe if someone said S**T doesn't SMELL."
3) Last October (Oct '07) I had stressed very clearly the problems facing US Economy. I also told that markets are peaking out and one has to be very careful as correction was anticipated. I repeated the same thing after this year's BUDGET also that buying now is dangerous.
RJ On Corporate Governance/ Managment
1) Corp governace is ZERO/junk in China. In comparison, India is far better.
2) People did not invest in STERLITE saying this and that about mgmt but the share moved from Rs.40. Markets focus on RESULTS. ( Again same view, I also never put any emphasis on how is the management)
RJ ON Markets/ Individual Scrips
1) Please do not ask about Individual scrips. My lips are sealed and SEBI's guidelines apply.
2) This is the FIRST significant TIME-WISE and PRICE-WISE correction
3) Believes India's
a) economic growth to continue and
b) the vast underexposure to equity investments will correct over time.
4) Worried about rising Inflation, Housing and auto sector to bear the BRUNT.
5) RNRL and RIL Gas issue, if settled, could act as a Positive trigger but not so much as to start a big rally or a Boom again in the markets.
6) Markets perception is that the BOTTOM WILL BE MADE when the Election DATES are announced. Though I personally wouldn't concur with this opinion, if past experiences are taken into acount, THE FIRST YEAR WHEN A NEW GOVT COMES INTO POWER IS A GOLDEN ERA.
7) Markets before rising again might move in a narrow range for around 3-6 months forming a base.
8) Take your OWN decisions, Tips are Hazardous to your wealth.
9) Last October, (2007) I stressed very clearly the problems facing USA. I also told that markets are peaking out and one has to be very careful as correction was anticipated. I repeated the same thing after this year's BUDGET that buying shaes now was risky.
10) I will buy any share in any sector, but I always check if the future looks bright and I do not view it from 1 year returns and I don't give priority to it . I give PRIORITY to the FUTURE EARNINGS POTENTIAL of a company.
Some of RJ's quotations
1) Karch karna aasaan hi, kum karna muskil hi
2) Markets and Women are the same...both are volatile, unexpected and he has a FOUR letter word for them (no not what u think).....its LOVE.
3) Fall in love with your Wife, not with your Stocks
4) Respect the Markets and do MAKE mistakes, but see to it that you can afford to stay in the markets even after the mistake.
5) A friend from Dubai asked me Tax? Woh kya hota hi? I wish I could say the same thing to IT Dept in India....
I will only write that ,being in USA I was able to come to know that RJ was going to speak at Hydrabad and hence I have got this.Well,why don't someone came out and tell me this?This shows that you all are not agile and aware of what is going on .......
Now try to find your picks from these post....
Saturday, August 23, 2008
Sriram EPC has given 100% return in exact 1 month and it has not budge an inch after my call.I gave a call of Sriram EPC at Rs 128 and yesterday it ended at Rs 259! that is double from July 21 st .It is exactly 1 month after I gave the call.Today is 22nd Aug.
This is called a multibagger return.When a stock gives 10-20% return in couple of months the paid sites and bloggers and other so called analyst use to blew the trumpet that they were successful in a big way.
But what to say about 100% return in a month?It comes to 1200% return in a year and if it is so then I have done that.No business on earth can give 1200% return in a year.
Well, if it would have been a penny or smallcap stock then I would have not claimed this.But when a stock like Sriram EPC gives 100% return then one has to take note of that.When the real estate , construction stocks are down so heavily Sriram EPC is movng like a rocket and not budging to any pressure.Moreover when the chips are down and no one is ready to buy anything the return looks very sweet.
I still suggest to hold on stocks that I had given call and the patience will be rewarded.I am sure about my picks withstanding the line that "BUYER ASSUMES ALL RISK" and that is a statutary warning forever on my blog....
I will seldom give SELL call.I gave one call for SEL Manufacturing when a reader named Jayaram asked me about SEL Manufacturing.It was then at 495 something...and now it is 290...Rs 200 shaved off from where he asked.I wrote him in comments section in a reply that one should get out of SEL Manu as the speculation is over and I also gave the reason for that.
If any other have read that it was there.I explained it in detail why SEL Manufacturing is a SELL now.That is why I use to write that read my replies as well on comments section which people use to ask me.I remember I use to write at MMB as well to boaders there that do read my replies I have written to others as well.Otherwise one can loose the link and one can end up in asking redundant queries which I have already given the answer to someone else.
It is natural that with limited time I can't give answering questions I have already answered.I hope readers can atleast help me that way.
This is a rare occasion I have shouted from the top of the Roof about my call.I hope readers can understand what I am upto.....
Wednesday, August 20, 2008
Media was his greatest critics and the news channel were just behind Modi.Every paper and evey news channel were trying to portrait Modi as a Jallad and a traitor and he showed to them that he meant business.
Other states ask Centre to give such powers and such swepping changes to do something in their state....in where the centre party is ruling at state level.
Though USA has denied Visa to Modi twice on humanetarian ground, he has wons big investment from overseas and the anamoly is these investment has come from USA as well!
It is also a fact that apart from the recent blast Modi has been successful in keeping the state away from this bomb blast...for almost over 7 yrs....
Modi has showed the efficiency of USA where after 9/11 there is no bomb blast.In Gujarat there was none untill the recent one.....what ever Media says but Modi meant business for Gujarat and as he pledge for the upliftment of Gujarat and he has done that.....
Centre instead trying to belittle Modi should try to find out what strategy he has made to make Guj having at the top of all state in almost every sector whether it be litracy,Water management(Kuch was a desert and he made it green)...
It is time for the Media and political party to look at what can be done for bringing down the poverty and illitracy...and thus increase the overhead income of whole India......
Modi needs salutation for his planning and his acumen.....
I am seeing in Narendra Modi a PM material.People of India will say one day that we want Narendra Modi as our PM.
Gujarat remains biggest investment magnet in FY08 too
Our Bureau MUMBAI
GUJARAT is still on top of the heap when to comes to the list of most attractive investment destinations in the country. The state attracted maximum project investments in 2007-08, followed by Maharashtra, Orissa and Andhra Pradesh, according to a study by the Reserve Bank of India on projects funded by banks and financial institutions. At the same time, the overall investments in the country are expected to moderate in 2008-09. With a proposed investment of Rs 62,442 crore from 100 projects, Gujarat continued to occupy the top spot as far as investment intention is concerned. Of the total investment intentions in 2007-08, the state accounted for 22% of the total proposals for the year, though the share dipped from the previous year’s share of 25.8%. Maharashtra, which ranked second, had a share of 12.7%, envisaging investments worth Rs 36,202 crore. Orissa was third with 10.9% share, accounting for investments worth Rs 30,913 crore, followed by Andhra Pradesh (8.5%), Chhattisgarh (6.2%), Tamil Nadu (5.6%), Karnataka (3.7%), Uttar Pradesh (3.5%) and the rest sharing less than 3% each. The study involves 910 projects that were sanctioned assistance by banks and financial institutions in 2007-08 with an aggregated envisaged project cost of Rs 2,84,371 crore. However, as for the investment outlook for 2008-09, the central bank has said private corporate investment is likely to increase, although it may grow at a slower pace. Cumulative capital expenditure for all ongoing projects is expected to dip to Rs 1,48,350 crore, compared to Rs 1,99,262 crore in 2007-08 and Rs 1,68,010 crore in 2006-07. If the aggregate capital expenditure in 2008-09 were to surpass the level intended for 2007-08, fresh capital expenditure in 2008-09 must be above Rs 71,934 crore. Although there could be a slight shift in financing conditions which may affect the fundamentals that drive business investment, corporates’ incentives to invest are likely to remain strong in 2008-09. This would be because domestic demand and capacity utilisation rates would be high amidst improved profitability of the last few years. The study also notes, “The real GDP grew at a substantially high rate in 2007-08, on top of robust economic growth in recent years. Notwithstanding the recent slowdown in overall business activity, corporate sector managed to maintain quite a decent profitability level in 2007-08 and against the backdrop of upbeat performance in recent years, the corporate sector appears to have the capacity to invest. Downside risks arise from the likely impact of high and rising international oil prices, increasing cost of external capital, hardening of interest rates abroad and input and wage cost pressures in some industries.”
Monday, August 18, 2008
It has a hefty reserve of Rs 507 cr on an eq base of just 7 cr…..just calculate the BV!
They have hefty orders of over 2000 cr.
52 week high was Rs 869 and low is Rs.268….
Np increased from 9.2 cr to 14 cr.
Madhucon Proj has interest in
1)High Way projects
3)Express Highway and Toll Roads
6)Sewage Terminal Engineering
Expertise in project management,Design and engineering,Project execution and const management….
Moreover the Infra project arm is getting demerge from Madhucon project.
Madhucon Projects Limited
Madhucon Projects Limited (MPL) is a profit making listed Public Limited Company engaged in execution of Infrastructure Projects, such as construction of National Highways, Fly-Overs, Dams, Tunnels, Aquaducts, Bridges, Coal Handling Plants, Workshops Property Development Projects including High Rise structures, Hospitality and retail industry structures etc. & enjoying substantial non-fund based limits in the form of Bank Guarantees with Banks under Multiple Banking arrangements.
Madhucon Sugars Limited
Madhcon acquired a loss-making and sick sugar factory in the co-operative sector at Khammam and turned it to a profit making company. Madhucon Sugars Limited's (MSL) present crushing capacity is 1500 TPD, which is being augmented to 5000 TPD in stages. The sugar factory is adding an Ethanol Distillery also, apart from setting up a 22MW Cogen Plant for producing power, using bagasse as the main fuel.
Simhapuri Energy Limited
Madhucon is setting up a coal based Thermal power plant of 50MW at krishnapatnam in Andhra pradesh in two phases. In the first phase, generating capacity of 135MW in will be commissioned and in December 2009 and 135MW in March 2010. Power purchases Agreement (PPA) and coal linkage have been tied up with power Trading Corporation of India. The fuel coal for our power plant is met from our own mines in Indonesia.
PT Madhucon Indonesia
Madhucon has started open cast coal mining in Indonesia on a 100 acres site initially. We expect to mine about 3 lakh tonnes production by December 2007. The coal has higher calorific value and less ash content compared to domestic coal.
Madhucon Granites Ltd
Madhucon Granites Ltd(MGL) has an experience of over 16 years in the business of quarrying dimensional granite blocks and production of polished slabs catering to the needs of international markets, the world over. It has earned a name for quality, dependability and competitiveness in the international market for its products with a wide variety of colours and shades. MGL established its first 100% EOU in 1988, in the granite rich region of Khammam District in Andhra Pradesh.
The factory at Khammam processes a wide variety of intricately patterned monuments in various shades of Black, Black Galaxy, Vizag Blue, Paradise,etc. crafted by skilled artisans.
MGL has a reputation for excellence in terms of quality of products and timely delivery of shipments, catering to the varied needs of the customers, the world over.
MGL has a very sophisticated Processing Plant spread over 12.5 acres near Hosur on Bangalore - Chennai Highway. The-state-of-the-art facility is an epitome of excellence in design and work flow methods - equipped with Avant-Garde processing know-how from Germany and France.This Plant envisages an annual production of 7,00,000 sq. meters finished slabs of 2-4 Cms thickness and in sizes ranging from 2.60 x 1.20 to 3.40 x 2.10 meters.
Madhucon Granites owns quarries spanning over 2250 acres of land having abundant Granite deposits in the States of Andhra Pradesh, Tamil Nadu, Karnataka, Orissa and Madhya Pradesh in India. The jewel of the crown is the world famous Black Galaxy quarries in Chimakurthy area of Prakasam District of Andhra Pradesh, which alone produces about 1000 CBM of rough blocks every month.
MGL has to its credit an exquisite variety of fine Granite-earthy stones to soft corals and greens. The range displays rare varieties of textural beauty and shades such as - Steel Grey, Absolute Black, Vizag Blue, Ilkal Rose, White Galaxy, Himalayan Blue, Kashmir White, Paradise, Red Multi, Imperial Green, Seaweed Green, Tan Brown, Salem Blue, Madhura Gold, Kashmir Gold, Columbo Jupurana and Lady Dream.
MGL has its presence felt in USA, UK, Japan, Germany, France, Italy, Belgium, Holland, Middle East and Australia. MGL is developing its own distribution network in USA, Middle East, Australia and other countries. MGL has warehouses in Dubai, Australia, Indonesia & USA.
(International footing co going so cheap?)
A company having a hefty reserve of Rs 507 cr on and eq base of just 7 cr and with so many subsidiaries and interest in almost all field needs a better valuation and one should buy this at the CMP of 298.
It is a Bonus candidate too…….
Madhucon Proj can give even 5 bonus shares for every 1 share held that much reserve it has got and still one can see no dent in it’s reserve…as it can eat only 35 cr from the reserve.This is just my view and no inside info about Bonus….
The orders are pilling up and will keep on going up.I see no problem in executing them as they have enough reserve to take care of any project to get executed.With 500 cr reserve on a tiny eq base of 7 cr any bank can open a credit for them……
According to the latest annoucement at bse ,Madhucon Project has won EPC contracts of Rs 989 cr for Thermal Power plant at Ksrihnapatnam South , Nellore dist,AP.....These are the things to come in future....
A single contract of Rs 989 cr speaks the capacity of this small co...which is in process of becoming a Goliath.....
Take your own decision……
Saturday, August 16, 2008
10 july 2008
Our Bureau BANGALORE
THE State Trading Corporation (STC) has started trial cultivation of a bio-engineered, high-yielding variety of jatropha in Surinam in South America and is in talks to grow the crop in Indonesia as part of a move to raise output of the biodiesel feedstock. The export house is also considering tieups with aircraft makers to supply biodiesel derived from jatropha to be blended with jet fuel, CMD Arvind Pandalai said. Trial cultivation has started on about 100 hectares in Surinam and the plantation is expected to eventually cover some 50,000 hectares. STC has spent more than Rs 10 crore to develop new varieties which are rich in oil and grow faster than the conventional types. “We have been able to develop varieties which can be harvested in about eight months against the conventional four years. The bioengineering effort has also ensured that these new varieties have four oil-bearing pods instead of the normal three,” Mr Pandalai said. Besides the focus on biofuels from jatropha, STC is promoting export of many Indian commodities, including tea. The company is looking to increase the network of tea factories and expand its footprint in south India by sourcing from small tea-growers in Kotagiri in Tamil Nadu. STC has been buying about 60,000 kg of green tea every day from small growers to be processed at factories identified by the company nearby. The Tofah brand of CTC tea is being exported and has earned revenues of Rs 500 crore so far, he said. Some of the tea is also sold in the domestic market through the Gujarat Civil Supplies Corporation.
STC is a government owned biz .I usually do not follow PSU's as it is government decision sensitive.But seems here the management is working in right direction without any interference from the Babus....
Being a trading co they must also be having vast lands at prime location for warhousing and the above move to grow Jathropa is a master stroke by the Management.Cultivating Jathropa's in USA and Surinam needs a vision and that is what they are showing...... “We have been able to develop varieties which can be harvested in about eight months against the conventional four years....."These needs R&D ....which they have done.....
What other will need 4 years to grow Jathropa Plants, STC will be able to do in 8 months...that is a huge huge advantage.....then its peers...
The management seems very dynamic.....the future growth & Scalability is visible.......
12 Aug, 2008, 0146 hrs IST,
Vivek Sinha & Joji Thomas Philip, ET Bureau
IDFC Private Equity, US investment major DB Zwirn, sovereign wealth funds Singapore’s GIC-managed Indivest, Qatar’s Oman Investment Fund and Quippo Infrastructure are pumping in Rs 781 crore ($185 million) in Quippo Telecom Infrastructure. The fresh investments is through a mix of rights issue and entry of a new investor-Oman Investment Fund-which is picking 18.74 per cent in Quippo Telecom for Rs 480 crore, say sources. The balance Rs 301 crore is being brought in by existing investors in Quippo including Quippo Infrastructure, DB Zwirn, IDFC Private Equity and Indivest. Indivest and IDFC Private Equity are picking 12.19 per cent stake each in Quippo Telecom. Quippo Telecom is the telecom towers arm of Quippo Infrastructure, which is one of the largest infrastructure equipment rental firm in the country. It is learnt that Quippo Telecom is looking to rollout 6,000 towers next year and has plans to increase it to 21,000 towers by 2011. The funds will be used for financing this expansion. The company rents its towers to all telecom operators including Bharti Airtel, Vodafone Essar and Idea Cellular. Quippo Telecom is backed by holding firm Quippo Infrastructure, which is promoted by the Srei Group. Last year, the latter bought out Spice Communications tower business for Rs 500 crore. The fresh fund infusion will make Oman Investment the second largest shareholder in the firm behind Quippo Infrastructure. DB Zwirn will hold 16.23 per cent in the firm post transaction. With the fund infusion, total direct and indirect foreign holding in the firm will rise from 65.63 per cent to 82.55 per cent. Sources say this investment is part of a bigger fund infusion which would see the paid-up capital of Quippo Telecom go up from Rs 1,000 crore to Rs 1,969 crore. Quippo Infrastructure, which has a diverse set of investors including Srei Infrastructure Finance, Opulent Venture Capital, Dutch financial institution FMO, Ingersoll Rand India and risk capital firm Swedfund International Aktiebolag, is the country’s largest infrastructure equipment rental company. It services the needs of construction, mining, oil & gas, telecom and energy sector. The telecom business rents its towers to telecom operators while the oil and gas subsidiary is in the business of renting on-shore drilling rigs.
Apart from SREI Infra biz its promoted Quippo is making news now a days.I am very bullish on Quippo....as it has many business and all are flourishing......
SREI Infra has remained rock solid in this fall.......
Imagine what will be the orders for Sujana Towers when only Quippo is thinking of building Towers 6000 towers next year and 21000 by 2011.....
Wednesday, August 13, 2008
I am writing some stocks which I have written here and maybe even some newer ones.
1) SREI Infra
3) XL Tele
4) Mudhucon Projects
5) JMC Projects
6) Shakti Sugar
7) Mcnally Bharat
8) Jyoti Ltd
9) Sujana Towers
10) Asian CERC
11) Time Technoplast
12) Hind Oil Exploration
13) Champange Ind
14) Millenium Beer
15) Gremach Infra
16) Thiru Arroran
17) Arrow Webtex
19) Torrent Power
These are some of the stocks I have discussed and written here.The new ones are STC,Mudhucon Projects,Hind Oil,Thiru Arroran Sugar,Arrow Webtex and Torrent Power and I will write about them in my next post which will follow very early.
But I would again like to write that just look at the announcement and promoters stake and results at bseindia site.
I am doing nothing more.I just do all these…..and pick them up….
Saturday, August 9, 2008
I remember I wrote about the effect of dollar appreciating and its effect on Oil prices.
That is happening now.See the fun now....Crude tanked to $113.....
I wrote many times that if America has to survive then Crude has to go down as Americans use the gas most......I am here in USA since 6 months.US is such a vast land that even to go for buying grossery they have to move by car....so Car is a must for each and every American.If one is not having a car he is just confined to his house.He can't go anywhere.
Now the Dollar appreciating heat is taking toll on crude because still the currency in which the crude and commodities are traded is dollars and dollar was weak, and hence crude was going up, and kept purposefully weak so as to strengthen their economy to deal with China trade deficit .I was knowing the day they will think that dollar should appreciate it will and we are there..... It is all in USA hands ......what price they wants to keep for Crude.......
People, analyst still thinks that demand has outstrippped supply but that is not the case....
Gold, oil face the dollar heat:
NEW YORK: Oil dropped to a three-month low on Friday as the dollar surged and concerns about global economic growth weighed on demand expectations. The fall came even as Russia s eent forces into Georgia, a key energy transit region, to repel a Georgian assault on the breakaway South Ossetia region. US light crude fell $3.84 to $116.18 a barrel by 22:30 pm IST, after hitting $115.61, the lowest level since early May. The drop added to losses that have sent prices down from a record high over $147 a barrel on July 11. London Brent crude traded down $3.90 to $113.96. “It seems that we’ve got a lot of selling based on the stronger dollar,” said Peter Beutel, president of trading consultants Cameron Hanover. “Energy demand destruction and the dollar return have formed a quiet alliance to bring the oil market down, and today the louder of the two is the dollar.” Strong demand from emerging economies like China sent oil on a six-year rally, with prices up seven-fold at their peak. More support came from investors rushing into commodities as a hedge against inflation and the weak dollar.
But mounting global economic problems and high fuel prices have begun to hurt demand, weighing on prices. The dollar surged against the euro and was on track for its biggest one-day gain in four years as concerns mounted that the US economic slowdown was spreading to the euro zone and around the world. “The market has been ignoring the Tbilisi pipeline situation, and now the problems with Russia — the move lower really now has a momentum of its own with the financial players coming out,” said Olivier Jakob at Petromatrix. Georgia’s pro-western president said on Friday the two countries were at war as Georgian troops backed by warplanes pounded separatist forces in South Ossetia and Russia sent forces to repel the assault. Analysts were concerned fighting could disrupt energy exports from the Caspian region that travel through Georgia. Oil had risen on Thursday due to the disruption of supplies through the Baku-Tblisi-Ceyhan pipeline following a blast this week in Turkey. The pipeline was still burning, halting loadings of Azeri Light crude shipped to the Turkish port of Ceyhan, but the fire could be extinguished on Friday or Saturday. Once the blaze is out, the pipeline could be reopened within 10 days. BP has cut output by at least 400,000 barrels a day at the Azeri-Chirag Gunashli oilfields, traders said. (Reuters)
I am now giving a list of stocks which are unknown and maybe penny stocks and I am tracking them since long and maybe I am holding them but as usual I use to hold very small quantity as I buy everything I like as I don't like missing any future mutibagger.....
I will write only names and nothing more.....
This will be under no circumstances is a BUY call for any of the stocks as they are highly dangerous to hold as one may loose the entire sum invested in any stock.These stocks comes in category of High Risk High gain stocks.....but if one buys get ready to loose the entire amount invested in it.....
1) Inducto Steel
2)Citi Port Finance
9)India Leasing and Development
11)Inter Link Petro
13)Laffans Petro(already written at mmb)
20)Asia HR techno
These are some of the stocks I track.There are still many others as well but will write some other time.I would like you to do due diligence and take a call.
I will only say that just go through the bse site.Read the annoucement of all these stocks.Check the promoters stake and see the results as well.....and take your own call.......
Investing in any of the above stocks can wipe out ones entire amount ....so be careful.....while buying..... these stocks.....
Just going against my forte, Fundamental stocks........but I have found something in each....and hence track them....
Best Of Luck ,
Friday, August 8, 2008
Sales rise 25.83% to Rs 13.69 crore
Net profit of Flex Foods rose 51.77% to Rs 3.43 crore in the quarter ended June 2008 as against Rs 2.26 crore during the previous quarter ended June 2007. Sales rose 25.83% to Rs 13.69 crore in the quarter ended June 2008 as against Rs 10.88 crore during the previous quarter ended June 2007.
Again the NPM has outperformed Sales.....it is doing this consistently.......I wrote the same things when last result were declared...
Debasis has asked me , whether this is the best time to enter market…that is a very very difficult question to answer.
I think even Warren Buffet or Ramesh Damani nor RJ can't answer this question.The only answer can be, buy when one see values.
Warren bought Wringly products when Dow was at 12000 and Kraft Foods when Dow was at 14k….and he is holding both.No one can pick the bottom nor the top.
Maybe one or two stock it is possible but one can’t repeat the performace forever.
So the best thing is buy when one sees value.
But that calculation can also go wrong if stocks drifts more further if we buy it even at 50% less….. …..
There can be no best level for entry because individual stocks runs on its merits …and when they run they do not look whether it is a bear market or bull market and hence we use to see 52 week high stocks even in bear markets.Hence only thing can be done is after due diligence , if one founds value then buy that stock and sit on it….until it runs…..
Make things clear….How much returns one wants. Sell as soon as that return gets achieved…don’t go to ask anyone….whether u have to sell it or hold it….
Booking profit is necessary for everyone.If one will see profit,only then one will be able to play in market.If some one has made big profit in market, use it. Go to some hill station with family , friends..buy something you so much wanted to buy….help someone you wanted to, near ones or dear ones…….
1) Make Goals.Tell yourself that if I earn so much I will use the profit in these way
2) Have a target.Tell yourself..I will sell this stock as soon as I get 30%-40% etc return…and stick to it…
3)Decide how much you wants to make return in whole year.
4)Decide how much amount you will be able to put in a year and expect how much return you need atleast.
5) Buy stocks with great future.Have conviction in what you buy.
6) Find stocks your self.This gives you enormous confidence and conviction.Read "Capital Market" magazine.Buy it every fortnight. Read the scoreboard regularly.
It give Promoters stake,BV,EPS,CPS….etc…..I have always been able to find multibaggers looking at the SB of CM magazine.
I hope this small tips can help readers.
Some of the stocks I like and I track are:
1) L&T( a gem of a co)
2) Ril Ind
3) Tata Chem
4) Guj Alkali
10) Time Techno
12) Champange Ind
15) Ril Ind Infra
16) LIC Housing
17) Madhucon Projects
18) India Glycols
19) Jindal Drilling
20) Alpha Geo
I have given only Large caps and Midcaps as I feel I use to discuss small caps many a times but I am sure getting return on the above of 50% is not a big deal in a year….
Best of Luck,
Wednesday, August 6, 2008
(ACPL), engaged in manufacture of Low Ash Metallurgical Coke (LAM Coke) and equipment rental, refractory and textile trading, proposes an IPO of 72,60,000 equity shares of Rs.10 each through 100% book building process in price band of Rs.164 to Rs.196 per share. The issue opens on 7 August and closes on 13 August 2008 and will be listed on the BSE and the NSE. CARE Ltd. has assigned ‘IPO Grade 2’ to the issue signifying below average fundamentals.
The object of issue is to part finance its expansion plan involving setting up a 1,50,000 TPA of LAM Coke and setting up a 8 MW captive power plant (CPP) through waste heat recovery. The project is coming up at Sindhudurga in Maharashtra. ACPL is setting up in-house refractory unit so as to improve the quality of operations. The company may also utilise residual funds raised for acquiring coal mines either in India or abroad and may retire high cost debt. Availability of quality coal on regular basis is critical for running its operations successfully. It has successfully placed 27,40,000 equity shares to Somerset India Fund at Rs.196 per share (at the upper price band) aggregating Rs.53.70 cr.
This Austral Coke & Projects Ltd. is a sister concern of Gremach Infra and Austral Coke & Projects Ltd. is coming out with an IPO will enhence the value of Gremach Infra considerably....
I am pasting here exactly what I read in ET today.....
Nifty stages a comeback, scales ‘500DMA’ resistance
Shakti Shankar Patra ET INTELLIGENCE GROUP
MUCH maligned in the recent past for gross underperformance compared to most of its global peers, the benchmark 50-share Nifty has made a dramatic comeback in the last few trading sessions. And in the process, has achieved something that none of the others have — re-conquered its 500 daily moving average (DMA) while most global indices continue to languish well below it. Though not as frequently talked about as some of its popular brethren, the 500 DMA is a very important long-term technical trend indicator — with life above it considered bullish and below it bearish. Its importance can be gauged from the fact that since conquering this key indicator in June 2003, the beginning of the last bull run, the Nifty never fell below it for the next five years. On rare occasions, the 500 DMA acted as a strong support and the Nifty invariably managed to bounce back strongly. However, this changed in June as the Nifty plunged below its 500 DMA for the first time in five years. Interestingly, this was the time when even the staunchest of the bulls threw in the towel and the bear market was, for all measures, confirmed. With Nifty conquering it back, bulls now have one more reason to celebrate. But they need to defend and build on it, if hopes of annexing the last and most important moving average — the 200 DMA, now at 5117 — are to be kept alive.
The picture is not all rosy though. As the adjoining table shows, most major global indices are well below their respective 500 DMAs — a clear sign that this is not the best of time for equity bulls. In fact, the only other major index above its 500 DMA — the Brazilian Bovespa — is consistently trending down and looks ready to plunge below it any moment. The fact that even the Sensex has still not managed to conquer its 500 DMA, only further complicates matters and makes the job of the bulls difficult. But given that the average major rally in the last bear market was for nearly 35% in around 3-4 months, the Nifty looks all set to retest its 200 DMA in a month or two, irrespective of whether we continue in this bear hug or manage to escape out of it.
I am all at Sea in technicals but the analysis habit to look whatever I read helps me sometime....but for that one has to read a lot and able to pick up what is written when he is reading……..but for that reading habit has to be cultivated…
I read a lot…….Lol…..I think many would read this news in ET today but ….
What is these 500 DMA?I never heard of 500 DMA....heard of 20 DMA, 50 DMA, 200 DMA but where this 500 DMA came suddenly from the blue?
But according to what written in the above text seems 500 DMA plays an important role in deciding the market course atleast in Indian Market, leave other markets…..
As it is said that 500 DMA is the most important support/resistance/levels for the market future course……Now coming to the next para wherein is written that Beware, “the Brazilian Bovespa — is consistently trending down and looks ready to plunge below it any moment”……it is actually written to misguide the investors or common man who only use to just read the paper and then believe what written is true and then comes out to argue…….
If Brazilian Bovespa is going to go below 500 DMA then it is a very very good sign for the whole world.It means that commodities prices will go down as the speculation in commodities is about to end…….as commodities prices will come down , Inflation world over will come down and slow down will be arrested …..
Cheers for the Brazilian Bovespa going down, friends!
I liked this news very much……I am not tracking Brazilian Bovespa recently but got to know about it while I read this………at one time Brazilian Bovespa was trading at over 55000……while India was just merely 21k…….and is now at 14700 after coming back from 12500 levels….India is a Great Value buy……
Crude is at $118.60 and Dow rushed to 331 points rally….seems the demand distruction is taking place too fast…..as crude is tanking so fast…….
Can't resist to write, which I recalled after I finished this post and that is if the crude speculation ends and so will commodities....where the money of the world over had gone in....then I heard at CNBC USA channel the otherday that over $ 3 trillion money will be back chasing equity ....getting out from commodities...I think I have not to write much now....
Time for Bulls to Massacre Bears ........
Tuesday, August 5, 2008
I am again writing some reasons for my bullish view.I know many are skeptic about and they are very bearish like Shankar Sharma…of First Global..
I know I have been proved wrong since many months in predicting the market and hence readers has to take this view as per his own thinking.....
Let us start now:
1) First and foremost fundamentals thing one should keep in mind is that,Bullmarket or bull rally is only possible if there is money coming in and hence it is natural that if money goes out from the market there is a gloom in the market.
2) Another thing to keep in mind is , market everywhere is driven on sentiments.If sentiments are not good then market will come down no matter how great the fundamentals are of any given company.
3) Now coming back on talk on our market, since last Mid Jan 08 FII’s has sold around Rs 35,000 cr worth of papers in our market. That is almost about $9 bn ….in last 6 months or so….Now we have to see why they have sold these much of papers…Looking back, it is very very clear that FII’s had to sell on compulsion instead otherwise like Booking Profit or Indian economy becoming unattractive.
4) To my best of knowledge this is the biggest ever selling ever taken place in our Indian market since our PM ,ManMohan Singh, who was the FM then in 1991…opened the door of liberisation…..History will have to take note of Mr.Manmohan Singh who made all these possible…and we are reaping the fruits of his foresighted decisions….
5) Well, the main culminator was Crude ….the prices went on high and high and its effect were seen on our economy and world over . The inflation went on and on and we are at now double digit nos.
6) I have been writing since months that Crude Oil going up is speculation and nothing else. People said the demand has increased…and that none other but from America it came that developing countries are consuming more crude .They said that emerging market economies is using more Oil and hence the crude is up. But I have also written here that the demand is increased by just 1% over last year then why crude has almost double? But none was ready to hear that and still not ready to hear it. They say that demand had increased and supply has been poor. Oil wells world over has now limited crude to feed the world for next over few decades. That is why Crude is going up.
7) I ask all of them a question….Why Crude tanks when USA government says that their Oil inventory has increased and Crude goes up when they say, Oil inventories has decreased? Now that is a hell of a question….can anyone answer that? What has it to do with Crude price? Why crude tanks and goes up on US inventory NEWS…Is USA inventory makes so big difference that crude moves on it news? and if the answer is yes , which is seen,then it becomes obvious that the prices of CRUDE is in hand of USA to decide.....
8) One more reason why I think USA is the only player for this crude rise. If we sit for a while and think that why Prez Bush should attack Iraq and spends over $600 billions of dollars in the WAR? Did he take this step to take the crude prices to $147 level and bring the US economy at the brink of collapsing…?I think one should find the answer in the above question….
9) Moreover the Subprime issue came out suddenly and the loss became huge and huge. They are/were in trillions of dollars….The decades old Bear Stern made a huge loss and Merill Lynch and Citi gr are still licking the wounds.Not to talk about Lehman Brs,UBS,CLSA etc….Indymac has to be ultimately takenover by Fed…..These losses had to be compensated somewhere.The whole money went in Commodities market and we can see the end results….Well, I know many have arguments for these. But Crude and Metals were more a speculations and not according to demand supply ratio. This can be seen that many Metals has been down since last couple of months and now Crude is also coming down.If the demand was high and supply poor then how Crude is coming down so fast?It was today $121…down from $147 few days back….it touched today 3 months low…today…wow!
10) I would like to refer my friends view here who is a great friend of mine and who has also started his recent own blog. His name is Jigs(mmb name)…..He says when Warren Buffet bought $2 bn worth shares of Dow Chemicals , we tried to find out what should be the reason for that. Dow use to buy Oil for its product means Oil is Dow’s raw material and if Buffet is buying then it means that he sees that it is high time Oil should come down and as per his followup, the day Buffet bought Dow Chem, Oil is retracing….Now this is how the things are to be seen. Mere reading his(WB) books takes nowhere….One should be able to get the clue from who is doing what..! Just like what Mark Sellers wrote in his lecture..
11) I am still unable to understand how people thinks that Oil is not a speculation…which gave over 40%v return in last 6 months?Any stocks which gives so much return so fast is given the name of speculation then why not crude and commodities….and that too when trillions of money is at stake in whole commodities market,,,,
12) Well coming back to our market..after looking at the above parameters, it seems obvious that our market tanked more on FII selling then on fundamentals reasons and we can add the planned attack from Bears with borrowed shares worth $7 bn ….Otherwise there is no reason market could come down constantly with out any pull back rally.Like Bulls have over done the rally upto 21k, Bears have equally or say even more overdone in selling the shares rock stock and barrel…..They thought the same way , a lay investors think..that crude will keep on going up and up to $170 and then to $200 ….and hence they lost the reasoning sense…..that happens when one proves correct in his call. If some smart players with high degree of experience and qualification can loose their vision then what to tell about small investors or any one here….Crude is coming down and the main reason for the Bears to break the market is diminishing very fast.That is why the CEO of First Global,Devina Mehra( if I can recall, she is Shankar Sharma’s wife)spoke couple of days back at CNBC that for 6 months Indian market can outperform the global market…..Why the Bear become Bulls?When they saw that crude is tanking and now they are out from the scene….?I rewrite that I have already written that next 6 months can be great for our markets....much earlier..
13) Now as I have written here in past , we have to see how Bears buys the shares from the market which they short sold which is worth $7 bn….as things are changing fast with Crude tanking , they have to give them back to the lender…what repercussions are seen when they come out to buy those shares and hence they become BULLS from BEARS on COMPULSION….I hope readers gets me what I mean to say….
14) I have written , things can change dramatically.If crude comes down and hence inflation, the slow down in world over will be arrested.And as Market use to sense this upcoming things and starts discounting it as it discounted the negative news well in advance….since Jan 08…then we can see a big turn around from hereon….
Last, some of my picks are going great guns.e.g I gave a recommendation to someone in comments that Mellinuim Beers is a buy along with United Beers.Millinium Beers was up by 27% in last 3 days…there are many that has moved fast….Just track them…
Monday, August 4, 2008
I am pasting here the exact text which Mr Azad posted here.But I thought it is a very very good read....which says many such things which one needs to still learn....I hope Mr Azad will not mind posting it at the front page.....
So You Want To Be The Next Warren Buffett? How’s Your Writing?
By Mark Sellers
First of all, I want to thank Daniel Goldberg for asking me to be here today and all of you for actually showing up. I haven’t been to Boston in a while but I did live here for a short time in 1991 & 1992 when I attended Berklee School of Music. I was studying to be a jazz piano player but dropped out after a couple semesters to move to Los Angeles and join a band. I was so broke when I lived here that I didn’t take advantage of all the things there are to do in Boston, and I didn't have a car to explore New England. I mostly spent 10-12 hours a day holed up in a practice room playing the piano. So whenever I come back to visit Boston, it’is like a new city to me.One thing I will tell you right off the bat: I’am not here to teach you how to be a great investor. On the contrary, I’am here to tell you why very few of you can ever hope to achieve this status. If you spend enough time studying investors like Charlie Munger, Warren Buffett, Bruce Berkowitz, Bill Miller, Eddie Lampert, Bill Ackman, and people who have been similarly successful in the investment world, you will understand what I mean.I know that everyone in this room is exceedingly intelligent and you’have all worked hard to get where you are. You are the brightest of the bright. And yet, there’is one thing you should remember if you remember nothing else from my talk: You have almost no chance of being a great investor. You have a really, really low probability, like 2% or less. And I’am adjusting for the fact that you all have high IQs and are hard workers andwill have an MBA from one of the top business schools in the country soon. If this audience was just a random sample of the population at large, the likelihood of anyone here becoming a great investor later on would be even less, like 1/50th of 1% orsomething. You all have a lot of advantages over Joe Investor, and yet you have almost no chance of standing out from the crowd over a long period of time.And the reason is that it doesn't much matter what your IQ is, or how many books or magazines or newspapers you have read, or how much experience you have, or will have later in your career. These are things that many people have and yet almost none of them end up compounding at 20% or 25% over their careers.I know this is a controversial thing to say and I don't want to offend anyone in the audience. I’am not pointing out anyone specifically and saying “You have almost no chance to be great.” There are probably one or two people in this room who will end up compounding money at 20% for their career, but it’s hard to tell in advance who those will be without knowing each of you personally.On the bright side, although most of you will not be able to compound money at 20% for your entire career, a lot of you will turn out to be good, above average investors because you are a skewed sample, the Harvard MBAs. A person can learn to be an above-average investor. You can learn to do well enough, if you are smart and hard working and educated, to keep a good, high-paying job in the investment business for your entire career. You can make millions without being a great investor. You can learn to outperform the averages by a couple points a year through hard work and an aboveaverageIQ and a lot of study. So there is no reason to be discouraged by what I’m saying today. You can have a really successful, lucrative career even if you’re not the next Warren Buffett.But you can’t compound money at 20% forever unless you have that hard-wired into your brain from the age of 10 or 11 or 12. I’m not sure if it’s nature or nurture, but by the time you’are a teenager, if you don't already have it, you can't get it. By the time your brain is developed, you either have the ability to run circles around other investors or you don't.Going to Harvard won’t change that and reading every book ever written on investing won't either. Neither will years of experience. All of these things are necessary if you want to become a great investor, but in and of themselves aren't enough because all of them can be duplicated by competitors. As an analogy, think about competitive strategy in the corporate world. I’am sure all of you have had, or will have, a strategy course while you’re here. Maybe you’ll study Michael Porter's research and his books, which is what I did on my own before I entered business school. I learned a lot from reading his books and still use it all the time when analyzing companies.Now, as a CEO of a company, what are the types of advantages that help protect you from the competition? How do you get to the point where you have a wide economic moat, as Buffett calls it? Well one thing that isn't a source of a moat is technology because that can be duplicated and always will be, eventually, if that’s the only advantage you have. Your best hope in asituation like this is to be acquired or go public and sell all your shares before investors realize you don’t have a sustainable advantage. Technology is one type of advantage that's short-lived. There are others, such as a good management team or a catchy advertising campaign or a hot fashion trend. These things produce temporary advantages but they change over time, or can be duplicated by competitors. An economic moat is a structural thing. It's like Southwest Airlines in the 1990s it was so deeply ingrained in the company culture, in every employee, that no one could copy it, even though everyone kind of knew how Southwest was doing it. If your competitors know your secret and yet still can’t copy it, that’s a structural advantage. That's a moat. The way I see it, there are really only four sources of economic moats that are hard to duplicate, and thus, long-lasting. One source would be economies of scale and scope. Wal-Mart is an example of this, as is Cintas in the uniform rental business or Procter & Gamble or Home Depot and Lowe’s. Another source is the network affect, ala eBay orMastercard or Visa or American Express. A third would be intellectual property rights,such as patents, trademarks, regulatory approvals, or customer goodwill. Disney, Nike, or Genentech would be good examples here. A fourth and final type of moat would be high customer switching costs. Paychex and Microsoft are great examples of companies that benefit from high customer switching costs.These are the only four types of competitive advantages that are durable, because they are very difficult for competitors to duplicate. And just like a company needs to develop a moat or suffer from mediocrity, an investor needs some sort of edge over the competition or he'll suffer from mediocrity.There are 8,000 hedge funds and 10,000 mutual funds and millions of individuals trying to play the stock market every day. How can you get an advantage over all these people?
What are the sources of the moat?
Well, one thing that is not a source is reading a lot of books and magazines and newspapers. Anyone can read a book. Reading is incredibly important, but it won’t give you a big advantage over others. It will just allow you to keep up. Everyone reads a lot in this business. Some read more than others, but I don’t necessarily think there's a correlation between investment performance and number of books read. Once you reach a certain point in your knowledge base, there are diminishing returns to reading more. And in fact, reading too much news can actually be detrimental to performance because you start to believe all the crap the journalists pump out to sell more papers.Another thing that won’t make you a great investor is an MBA from a top school or a CFA or PhD or CPA or MS or any of the other dozens of possible degrees and designations you can obtain. Harvard can't teach you to be a great investor. Neither can my alma mater, Northwestern University, or Chicago, or Wharton, or Stanford. I like to say that an MBA is the best way to learn how to exactly, precisely, equal the market return. You can reduce your tracking error dramatically by getting an MBA. This often results in a big paycheck even though it's the antithesis of what a great investor does.You can’t buy or study your way to being a great investor. These things won’t give you a moat. They are simply things that make it easier to get invited into the poker game.Experience is another over-rated thing. I mean, it's incredibly important, but it's not a source of competitive advantage. It's another thing that is just required for admission. At some point the value of experience reaches the point of diminishing returns. If that wasn't true, all the great money managers would have their best years in their 60s and 70s and 80s, and we know that’s not true. So some level of experience is necessary to play the game, but at some point, it doesn’t help any more and in any event, it’s not a source of an economic moat for an investor. Charlie Munger talks about this when he says you can recognize when someone “gets it” right away, and sometimes it’s someone who has almost no investing experience.
So what are the sources of competitive advantage for an investor? Just as with a company or an industry, the moats for investors are structural. They have to do with psychology, and psychology is hard wired into your brain. It’s a part of you. You can’t do much to change it even if you read a lot of books on the subject.The way I see it, there are at least seven traits great investors share that are true sources of advantage because they can’t be learned once a person reaches adulthood. In fact,some of them can’t be learned at all; you’re either born with them or you aren't.
Trait #1 is the ability to buy stocks while others are panicking and sell stocks while others are euphoric. Everyone thinks they can do this, but then when October 19, 1987 comes around and the market is crashing all around you, almost no one has the stomach to buy.When the year 1999 comes around and the market is going up almost every day, you can't bring yourself to sell because if you do, you may fall behind your peers. The vast majority of the people who manage money have MBAs and high IQs and have read a lot of books. By late 1999, all these people knew with great certainty that stocks were overvalued, and yet they couldn't bring themselves to take money off the table because of the “institutional imperative,” as Buffett calls it.
The second character trait of a great investor is that he is obsessive about playing the game and wanting to win. These people don’t just enjoy investing; they live it. They wake up in the morning and the first thing they think about, while they’re still half asleep, is a stock they have been researching, or one of the stocks they are thinking about selling, or what the greatest risk to their portfolio is and how they’re going to neutralize that risk.They often have a hard time with personal relationships because, though they may truly enjoy other people, they don’t always give them much time. Their head is always in the clouds, dreaming about stocks. Unfortunately, you can’t learn to be obsessive about something. You either are, or you aren't. And if you aren't, you can't be the next Bruce Berkowitz.
A third trait is the willingness to learn from past mistakes. The thing that is so hard for people and what sets some investors apart is an intense desire to learn from their own mistakes so they can avoid repeating them. Most people would much rather just move on and ignore the dumb things they’ve done in the past. I believe the term for this is repression.But if you ignore mistakes without fully analyzing them, you will undoubtedly make a similar mistake later in your career. And in fact, even if you do analyze them it’s tough to avoid repeating the same mistakes.
A fourth trait is,
an inherent sense of risk based on common sense. Most people know the story of Long Term Capital Management, where a team of 60 or 70 PhDs with sophisticated risk models failed to realize what, in retrospect, seemed obvious: they were dramatically overleveraged. They never stepped back and said to themselves, “Hey, even though the computer says this is ok, does it really make sense in real life?” The ability to do this is not as prevalent among human beings as you might think. I believe the greatest risk control is common sense, but people fall into the habit of sleeping well at night because the computer says they should. They ignore common sense, a mistake I see repeated over and over in the investment world.
Trait #5: Great investors have confidence in their own convictions and stick with them, even when facing criticism. Buffett never get into the dot-com mania thought he was being criticized publicly for ignoring technology stocks. He stuck to his guns when everyone else was abandoning the value investing ship and Barron’s was publishing a picture of him on the cover with the headline “What’s Wrong, Warren?” Of course, it aworked out brilliantly for him and made Barron’s look like a perfect contrary indicator.Personally, I’am amazed at how little conviction most investors have in the stocks they buy. Instead of putting 20% of their portfolio into a stock, as the Kelly Formula might say to do, they’ll put 2% into it. Mathematically, using the Kelly Formula, it can be shown that a 2% position is the equivalent of betting on a stock has only a 51% chance of going up, and a 49% chance of going down. Why would you waste your time even making that bet? These guys are getting paid $1 million a year to identify stocks with a 51% chance of going up? It's insane.
Sixth Trait #, it's important to have both sides of your brain working, not just the left side (the side that’s good at math and organization.) In business school, I met a lot of people who were incredibly smart. But those who were majoring in finance couldn't write worth a damn and had a hard time coming up with inventive ways to look at a problem. I was a little shocked at this. I later learned that some really smart people have only one side of their brains working, and that is enough to do very well in the world but not enough to be an entrepreneurial investor who thinks differently from the masses(maybe that is why they work for others). On the other hand, if the right side of your brain is dominant, you probably loath math and therefore you don't often find these people in the world of finance to begin with. So finance people tend to be very left-brain oriented and I think that’s a problem. I believe a great investor needs to have both sides turned on. As an investor, you need to perform calculations and have a logical investment thesis. This is your left brain working. But you also need to be able to do things such as judging a management team from subtle cues they give off. You need to be able to step back and take a big picture view of certain situations rather than analyzing them to death. You need to have a sense of humor and humility and common sense. And most important, I believe you need to be a good writer. Look at Buffett; he's one of the best writers ever in the business world. It's not a coincidence that he's also one of the best investors of all time. If you can't write clearly, it is my opinion that you don't think very clearly. And if you don't think clearly, you're in trouble. There are a lot of people who have genius IQs who can't think clearly, though they can figure out bond or option pricing in their heads.
And finally the most important, and rarest, trait of all: The ability to live through volatility without changing your investment thought process. This is almost impossible for most people to do; when the chips are down they have a terrible time not selling their stocks at a loss. They have a really hard time getting themselves to average down or to put any money into stocks at all when the market is going down. People don't like shortterm pain even if it would result in better long-term results. Very few investors can handle the volatility required for high portfolio returns. They equate short-term volatility with risk. This is irrational; risk means that if you are wrong about a bet you make, you lose money. A swing up or down over a relatively short time period is not a loss and therefore not risk, unless you are prone to panicking at the bottom and locking in the loss.But most people just can’t see it that way; their brains won't let them( Crick_love..as an example). Their panic instinct steps in and shuts down the normal brain function.I would argue that none of these traits can be learned once a person reaches adulthood.By that time, your potential to be an outstanding investor later in life has already been determined. It can be honed, but not developed from scratch because it mostly has to do with the way your brain is wired and experiences you have as a child. That doesn’t mean financial education and reading and investing experience aren’t important. Those are critical just to get into the game and keep playing. But those things can be copied by anyone.
The seven traits above can’t be. Ok, I know that is a lot of information and I want to leave time for questions so I'll stopthere.
I have highlighted the whole post with some RED and BLUE words ……Read it and if any query do revert…….I am there to answer………
Sunday, August 3, 2008
This is for you.......
Everthing is a SELL if sensex is to go below 10,000 and then to 9000 and then even 7000. ( this I specially wrote for those who are constantly bearish)There are many reasons on horizen, like Fiscal deficit which was not there when market went up but it is there now( Nicks....this is a sattire from me...Fiscal deficit was there even when market went up but people are counting that even now...Fiscal deficit has nothing to do with the bull run. but as I wrote , u don't understand what I write as u have nelsons eye vision..!), etc and some which have arised in recent times like Inflation, Crude prices going up which will not be cooling off in a short time and hence the whole world is looking like sitting at the edege of a lot more dangerous encounter. ( Crude speculation is a temporary phenomenone and as it will cool down so will inflation....but u didn't get it, that was another sattire from me....as the sentiments can change dramatically)
So when a consensus is made by almost all the people that market will drift to below 10000 levels there is, A ALL SELL OR SALE BOARD and hence I write a rare BUYING stocks which are now a surprise to everyone…..as if now,if one gives a SELL call on any stock it is a usual things and no one is surprised….and that is why I am giving a BUY call against the market general view……..which is a surprise. ( I gave a buy call on Shriram EPC which gave a almost 100% return)stocks drifts more then sensex goes down…..Everyone will get stocks still cheaper by over 50% from THIS PRICE …. ( I am just telling to get out of market who are bearish on market and come when we touches...7K )
If someone is thinking some some sector is only SELL then he is making mistake as when market comes down everything comes down. See what were the prices in 2000 and whether there was any sector left untouched…. Hence I urge everyone who are not bullish but rather negative ….that please sell everything as every thing they will get over 50% less even from hereon……… I hope my message is reached to them who are bearish….as on my blog I will always give a BUY call and never a shorting call. Means bottom up approach and not top bottom approach…….means first buying and then is selling and not first selling and then buying…. I am good in only one way and not both ways……. Hats off to them who are masters in both ways....I think even Warren Buffet is also good in buying first and selling....I admire the expertise of such people who are good in both ways....that is a rare combination......and that too make money in both ways giving calls..... Best Of Luck ……Friends…….
Nicks u didn't understand at all the whole post......there is a head and a tail as well....as I started the post with a head and ended with a tail......
If you still do not understand after this much of explanation, do write me...at email@example.com.....I will explain it there personally....... as I have not explanied fully everything but anyone can get it......but if you find still difficult then write me.....
Saturday, August 2, 2008
I am just pasting the interview given by Vallabh Bhansali the CM and partner of Enam Sec given couple of days back.....
Q: What’s your sense, of the impact this kind of an interest rate hike would have on growth and equities?
Bhansali: The market has spoken, but I think the market will start at some point of time, I hope very soon, diverging on the monetary economy or the monetary management, because fundamentally the market will have its own concerns and its own subsides. I think we are reaching a point where the upsides, given the price levels, will start overwhelming the downsides. So that’s how I see without getting into making a comment on what step this is.
Q: The fear is also that perhaps the market and several analysts are not quite getting a handle of how much this tightening is going to go towards; from April to now we have moved 150 bps on the CRR and 125 on the repo side. People are talking about inflation going close to 15%-17%, is that kind of tightening rate scenario and that kind of an inflation picture adequately factored in you think?
Bhansali: I think so; I clearly think that from a market point of view we shouldn’t get worried about this. The need to strengthen the rupee is quite obvious. So if I were to look at the upside of the moves by the government and the RBI, it will strengthen that case.
Also, the equity markets have the first reaction to hardening of interest rates. But the day after markets factor it in and move on. The euphoria is being buried and killed. So in the real economy, the governor said and so did a lot of other commentators, more and more people are veering around to the view that instead of a 7% growth, we will probably be at 8% or a little higher. So at the periphery, these interest rate moves will affect the economy but the core economy will continue to move as it was because India is in still the credit expansion mode or the credit part of the economy is not as large as it is in some of the western world where a move like this can have potentially a much greater effect.
So from my point of view, having done the first move, the marginal moves will have lesser and lesser impact. Though coming as it does at lower levels of the market the pain seems to be unbearable, but if you look at the totality of the impact at the margins, this is not going to effect much and therefore I am going to ask my people to research stocks with more vigour and find buying opportunities over the next 12 months.
Q: Does it worry you that these kind of interest rate spikes could hurt equities in more ways than one?
Bhansali: That would be the case definitely in the short term and that’s why I said 12 months to 18 months as this macro adjustment is made in the world and in a derivative manner in India. Equity markets will not be spared, but that’s where the opportunity comes and men and boys have started to separate seriously. Today when we see all bank stocks fall, I think it's clearly an opportunity. In bank results, different management responses from different institutions - that’s what equity markets are all about. So in the aggregate at the Index level, what you say may be right, but at the company level, serious opportunities will emerge. That’s what I think is exciting.
Q: We were talking to Pradip Baijal, Former Secretary of the Department of Disinvestment, before you came on and he was talking about whether and in what shape disinvestment might start again. Do you think we have a serious prospect of that seeing that over the next six-eight months?
Bhansali: To the extent that proposals don’t have to go to the parliament and what is well established and recognised within the departmental authority, I think there is some chance that divestments will happen. Some of them were in the pipeline and we have some cases where prospectus has been filed with SEBI. I think there is serious chance that some of that will happen.
Q: The market has been closely tracking crude prices and ever since this cool off, one opinion that’s coming around is there is almost a purging of asset classes, including crude now. How do you read the developments on the commodity front these past six-seven months?
Bhansali: I think commodities were going through a long-term cycle starting probably sometime towards ’98 -’99 and so we have had ten years of continuous uptrend in commodities. As the world slows down, I think the commodity cycle will also slow down and a lot of people are now convinced that oil will fall below USD 100. So I am also of the view that over the next 12-18 months, commodities will have peaked. I think the big opportunity to move out of equities and into commodity was probably in 2007. But increasingly now, the benefit of being in an equities will outshine the benefit of being in commodities over a two-three years perspective. In the short-term it’s difficult to make a call and I do not want to make any.
Q: Because you have seen many cycles with the market, just to look back in history, and in a similar situation in terms of macro developments and what was happening with the market?
Bhansali: If we put in to perspective from an equity market point of view, all kinds of bad news have hit us - we are facing an election, we had a close call on the government, we had bomb blasts, and we had oil prices go up. We had so much of bad news and macro worries, but that’s when the equity market opportunities start to take shape unknown in a prison cell somewhere and some new avatar is being born. So this is a nadir point and nobody can call the bottom of the market.
But we are clearly forming a bottom in the market and you can have some developments which bring in a sharp reactions but that’s about it. Sentiment is near the bottom of the cycle and a lot of stocks that are available at un-researched pricing levels and from an investor point of view, this is where one has to start looking at things.
I have highlighted in red and blue words.......read that properly and try to understand what he says.....
Enam Sec is decades old broking firm and started almost when I entered the market in 1985....
It use to have big name Viz: Great Manu Manek and Nemish Shah.....
Vallabh Bhansali is the brother of Late Manu Manek and Vallabh Bhansali himself is a great stock picker not to talk of Nemish Shah.....
Friday, August 1, 2008
There are many reasons on horizen, like Fiscal deficit which was not there when market went up but it is there now, etc and some which have arised in recent times like Inflation, Crude prices going up which will not be cooling off in a short time and hence the whole world is looking like sitting at the edege of a lot more dangerous encounter.
So when a consensus is made by almost all the people that market will drift to below 10000 levels there is, A ALL SELL OR SALE BOARD and hence I write a rare BUYING stocks which are now a surprise to everyone…..as if now,if one gives a SELL call on any stock it is a usual things and no one is surprised….and that is why I am giving a BUY call against the market general view……..which is a surprise.
And hence SELL EVERYTHING WHAT YOU HAVE, am sure one will get them much cheaper, if market is going to go down to 9000 and then even to 7000 as when Sensex will touch 7k , then it will be a 50% down from hereon and we all know that individual stocks drifts more then sensex goes down…..Everyone will get stocks still cheaper by over 50% from THIS PRICE ….
If someone is thinking some some sector is only SELL then he is making mistake as when market comes down everything comes down. See what were the prices in 2000 and whether there was any sector left untouched….
Hence I urge everyone who are not bullish but rather negative ….that please sell everything as every thing they will get over 50% less even from hereon………
I hope my message is reached to them who are bearish….as on my blog I will always give a BUY call and never a shorting call. Means bottom up approach and not top bottom approach…….means first buying and then is selling and not first selling and then buying….
I am good in only one way and not both ways……. Hats off to them who are masters in both ways....I think even Warren Buffet is also good in buying first and selling....I admire the expertise of such people who are good in both ways....that is a rare combination......and that too make money in both ways giving calls.....
Best Of Luck ……Friends…….