Financials are strange businesses. On a sale, money goes out from the pocket rather than coming in.
Growth comes first. NPA comes later.
Aavas Financiers says: “What Kills Others Makes Me Strong”
Buckle yourself up as we’ll take you through the 19-20 AR
1/
Challenges for Aavas:
~People, Process & Branch intensive
~Caters to Tier2 to Tier 6 towns
~Underwriting difficult
-Lack of docs
-No CIBIL records
-Mostly catering to EWS and LIG category
Now let’s run past the AR to find the cues to their success
2/
Aavas Financiers
A Fast-growing Small Housing Finance Company in a Large Growing Housing Finance Market in India
Indian Energy Exchange, like a toll bridge, connects power generators with power consumers & distributors. The alternative to IEX like alternatives to toll bridges is more expensive bilateral agreements.
Fasten your seatbelts as we’ll take you through the 19-20 AR of IEX.
2/ Transformation in the energy sector
~Benchmark prices for all electricity transactions
~Transparent mechanism for price discovery
~High liquidity on exchange to ensure the lowest cost and assured supply
1. Making money is not a thing you do—it’s a skill you learn. 2. Seek wealth, not money or status. 3. Ethical wealth creation is possible. 4. You’re not going to get rich renting out your time. You must own equity—a piece of a business—to gain your financial freedom.
5. You will get rich by giving society what it wants but does not yet know how to get. At scale. 6. The internet has massively broadened the possible space of careers. Most people haven’t figured this out yet.
Some lovely quotes from the book, “Alchemy: The Dark Art and Curious Science of Creating Magic in Brands” by Rory Sutherland.
If you read them, you will not be able to stop yourself from buying the book and read it.
A thread!
Here you go
1. The economy is not a machine – it is a highly complex system. Machines don’t allow for magic, but complex systems do. Engineering doesn’t allow for magic. Psychology does.
2. When you demand logic, you pay a hidden price: you destroy magic.
3. The human mind does not run on logic any more than a horse runs on petrol.
4. Human behaviour is an enigma. Learn to crack the code.
5. To avoid stupid mistakes, learn to be slightly silly.
6. More data leads to better decisions. Except when it doesn’t.
We are going to tell you about 3 famous Capital Allocators in the world of business & investing.
All 3 of them:
~Started with almost 0 inheritance of capital
~Built a formidable empire from scratch
~Acquisitions of businesses have been an integral part of their strategy
They are Different
~In their style of acquisitions
~In industries they operate in
~In geographies they cater to
~In scale, and
~In how they communicate to their stakeholders
Imagine all 3 of them to be in the same room and they are asked one by one what is one key aspect of their acquisition which separates them from the rest:
Capital Allocator 1: "I never look for a perfect asset. If you are going to acquire a perfect asset then the whole world is