Friday, October 19, 2012

An update on stuff...

Hello to all! Well, I have finished torturing my students (my lectures are over) and now its time to concentrate more on torturing my readers! :-)
I have this habit of putting up brief updates at regular intervals, so here it goes..

Mr.Market has smiled upon most of us and I believe that all of our portfolios will be galloping for whatever reasons! Many of us will be secretly considering ourselves as amazing stock pickers and investors. However, very few acknowledge the role that luck plays in investing. The usual thought process of a lot of investors is that if profit is made, it was skill, while if loss is incurred, it was (bad) luck. Its a very convenient way of turning our confidence into over-confidence. I had earlier written on the topic of skill v/s luck in investing.
Well, a couple of people, Abhinav and Niren have recently started a blog about investing, with this as the central theme. While I haven't had the chance to interact with Abhinav extensively, Niren and I have been friends for more than a decade and we meet up everyday for a cuppa tea. He is someone I regard highly as an investor and is someone whose thoughts any keen investor should follow. Here is a link to their introductory post. (Yes, I am promoting my friend's blog.. yes, I think he is a very smart investor and brings a fresh, new approach to the, he did not ask me to do it...yes, I will make him pay for tea for at least a week!)

Well, after diverting from the topic of this post and trying to promote my friend's blog to the very few readers of my blog, lemme get back to business!!

I had written about NBCC a couple of months ago. My view on the stock as a long term holding is not very positive due to the reasons mentioned. However, it is expected that the revenue and profit booking of their commercial real estate project which I had mentioned could happen in the either Q2 or Q3 FY12. When this happens, it will result in an exceptionally amazing quarterly result and there could be a nice spike-up in the stock price. However, from the longer term point of view, my concerns still remain and in my view treating this as a 'compounding long term story' is quite risky. Treat this as a 2-3 quarter 'trade'!!

APW President AGM was attended by a friend of mine. No fresh information was obtained. In my view, due to the lethargy of the promoters, valuations which are not 'sitter' valuations, in a industry which is not exactly going through good times, one should not take a large position in this.

Sundaram Clayton demerger record date is over and the existing company has also been delisted for some period of time. I was not invested in this situation, but I intend to keep a watch on the scenario post-relisting.

DISA India has given decent returns and since I had disclosed that I was buying the stock, I should disclose that I still hold the entire position. I am not even thinking about the delisting angle and I am comfortable as long as I can see that the business is doing well and valuations are not over-the-top. People interested in DISA might find this article interesting. :-)

Ashiana Housing has gone through some interesting times. I absolutely adore the management. In my view, they are best-in-class. However, due to the change in accounting policy they have initiated, one should expect very lumpy earnings going forward. While that does not matter to me, it might matter to Mr.Market! However, two factors - lack of growth and the unwillingness to distribute healthy dividend inspite of having great cashflow - make me sit back and think on the stock unemotionally. While I do not think that the company will destroy wealth, I fear that the stock could deliver sub-par returns due to these factors.

Falcon Tyres is something I had found very interesting in a negative sense! I continue to track the stock with interest! Apna kuch lena-dena nahi hai, but still, complete interest! :-)

Well, that's all for now. I am looking at a few interesting new ideas..will update about them soon.

Cheers and happy investing!!

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