Sunday, November 29, 2009

Warren Buffet and Rakesh Jhunjhunwala......

This question keeps on arising to my mind that, when WB is bullish on US economy, when RJ is bullish on Indian economy why others are not.
It is a known fact that WB is the richest and not one of the richest person in world.So is RJ , richest person in stock market terms atleast on paper as his wealth is as good as rs 5000 cr something around as of now......
We see Marc Faber, Jim Rogers speaking on US dollar and then also see some other expert saying the same thing that dollar is going to get junk and will depreciate and hence there is no future for US economy as a whole.While WB keeps on saying that overtime US economy will do good and he is so sure about that , that he actually bot Burlington Norflok for $32 bn which is no less and amt to consider as a peanuts.....why WB is buying Burlington at a premium?that question arises to my mind if the future of US economy is not good because the sector in which he has taken stake is related to the core sector for bulidup of any economy as it is a Railway Co.....then why he is risking $32 bn?
So then the question come is whether we need to follow what Marc Faber and Jim Rogers says or we should follow WB?and after some due diligence I came to the conclusion that I atleast need to follow WB and no one else.
Same case is with our Indian Stock Market where RJ keeps on saying he is bullish and other expert keeps on saying they are not citing all reasons.
Hence here again , my mind says we need to follow RJ and not someone else as they have proved wrong time and again.What RJ is able to see , others are not able to understand.
I have seen , that many are very bearish for our stock market in 2010.They have their reasons to believe but my mind says that we will see a new high next year Mark Mobious said , the earnings will keeps on getting rerated and stock will become cheaper ......
I am also seeing lots of discussion going on Chinese economy.That Chinese stock market is a bubble in making and it will collapse very soon.Well, I am not of that view.China will keep on growing and will keep on surprising market pundits.
I donno know whether those who are discussing US economy and Chinese economy and Indian economy , whether they are BUYING anything or just SELLING their holding.......
If someone has seen the parade of Chinese day, they showed their power with war heads.China is a trying to show to the world that they are the next economic power as well as financial power and can anyone think that the governmment there, a communist government will letgo such an opportunity easily?No way.......they will not let it go due to some miscalculation......


  1. The Reliance Solar Group has been successful in obtaining a certification for its Photovoltaic (PV) modules from TÜV Rheinland Japan Ltd. Their PV modules have qualified for the IEC 61215 certification as well as have been safety tested to be certified with the IEC 61730

  2. Hi Thinck Tank,
    good to know this about Reliance Solar Group. But in same category look for the stock suggested by Rajeev- PAE ltd.Attaching below the notice from PAE on bseindia web-site.( as its pdf file, not able to copy & paste)

    PAE is in same solar panel modules. And PAE is available below book value, less debt, continuous 5 yrs of increasing EPS. And above all Rajeev Recommendation. SO PAE is multi-bagger for sure.

    Just posting to let you know about this gem found out by Rajeev.
    With Regards,

  3. Hi Vikas,
    I already have PAE in my portfolio and i am also bullish on solar sector.PAE is doing same as China's SGEG , soon solar IPO is hitting china market. So solar is in news for some time to come.

    I copy some lines from J. Peter Lynch solar outlook

    What can Investors expect?

    Investors can expect very erratic movements in solar stocks until the overall market volatility starts to get back to the "normal" range. One can also expect, and we have already seen, significant industry consolidation and some (unfortunately) company failures. Keep in mind that this is NOTHING NEW in dramatically emerging industries, but remember that with this dramatic growth will also come greater than average volatility.

    With this said is there a way to look at solar stocks (or any stocks for that matter) today and try to "pick" the ones that have the most potential? Once again, it is impossible to accurately determine which will be the winners and which will be the losers. However I think that there are at least three areas that an investor should look that I would consider to be critically important especially in the current climate. If a company possesses ALL three of these characteristics it would have much higher probability that it will be a leader in the next phase of the emerging solar boom.

    First: CASH. During times like this CASH IS KING. So an investor will have to make sure to check each potential company’s balance sheet and insure that they have adequate cash reserves to carry them through at least 2009 without need of further financing.

    Second: RELATIVE STRENGTH. In periods like this good stocks and bad stocks BOTH are carried down with the general market. However, the better stocks generally drop last and come back (when the tide changes positive) first. These stocks will also most likely be the ones with the most cash (best financial shape) therefore with the best future prospects. As a result, an investor should look for the solar stocks with the highest relative strength compared to the general market - they will be the early leaders in the next market stage and the first to break above their 50 day moving averages (see below).

    As a note: the three top solar stocks: Trina Solar, Canadian Solar and Yingli Solar ALL had and continue to have dramatically higher relative strength as compared to the market in general and to the other solar stocks in their sector.

    One of the simplest short term methods I have used over the years to determine trading points for stocks (and the market in general) is the 50-day moving average. To summarize:

    If a stock is trading OVER its 50-day moving average it is in an uptrend.
    If a stock is trading UNDER its 50-day moving average it is in a downtrend".
    Third: PRODUCT DIFFERENTIATION. With a new industry like solar the longer term leaders are generally the companies with some form of competitive advantage or product differentiation. Remember these companies may have innovative products, but they must also pass the first two hurdles (cash and relative strength) in order to warrant further consideration as an investment

  4. Thanks a lot Thinck Tank for the details from Peter Lynch on solar industry.Though I studied PAE, frankly I was in doubt about investing in PAE. But now have made my mind to grab it!