In the business world, the rearview mirror is always clearer than the windshield. Be forward-looking as an investor. Read everything about the industry, peers, new products, new methods of distribution, etc.
My go-to resources📝📝
1)Concalls
2)DRHPs
3)QIP docs
4)Annual Reports
5)Magazines like contract pharma, chemical weekly, Forbes, Outlook Business, etc
6)Better to know as much before you are investing. Only annual reports won't cut in today's investing world due to the increasing amount of change that is taking place
7)Read about international
players as much as possible. Looking at what has happened in the international industry can you give you some insight what can happen in the Indian industry :)
The key to it all is consistency- just read for 90mins a day for the next 3 years. The only way to get ahead is reading
and taking out time for thinking. Reading is what most stick to, you will truly differentiate yourself if you take out time for thinking🧠
Once you have finally decided to invest. Maintain a journal or a decision-making book. If you are looking for certainty, the good news is no one really knows 😁 Everything is probabilistic in investing. This is what gives me peace of mind. Read more about our portfolio approach
The Table Experiment: SOIC way of thinking about a portfolio
Markets reward businesses that display the ability to diversify into adjacencies while at the same time maintaining their return ratios.Signals expanding size of opportunity and managements ability to identify more profit pools
Time for a thread with examples 🧵
Astralpoly🚰 isn't just a pipes company anymore. It is a water solutions provider dealing in Adhesives, Tanks, Valves, and Pipes. Homework for everyone: check the CFO compounding of the last decade
Divis Labs💊-again another API Champion which is entering Contrast Media API's which a very concentrated segment. They believe they have the process chemistry advantage over here as well!
Some Questions on Laurus (I totally respect everyone else's view, these are just mine, not arguing but engaging in civilized debate like humans used to do)
Watson: Laurus has been using aggressive accounting policies and in the H1FY21 bunching of inventories has led to CFO/EBITDA deteriorating
Sherlock: Such a question was expected from you, Watson! (mockingly) Let's take a longer time horizon and check the CFO/PAT & CFO/EBITDA
CFO/EBITDA for the past years
2016: 55%
2017: 75%
2018: 77%
2019: 80%
2020: 61%
in the first half of 2020, this has fallen to somewhere around 50%. A bystander would consider this to be a red flag, however in growing companies (whenever the growth is rapid and especially
Q2FY21 Concall Updates: Business, Risk and Management
Business
-Credit Rating has been upgraded by ICRA on back of the upgrade by Crisil in the last quarter.
-Topline was up by 12% (YOY) and 23% on QoQ basis.
-Margins remained at 32% and experienced 150BPS reduction in expenses primarily due to power cost and RM cost coming down,
and change in mix of the business.
-Staff cost increased by 22% to 161 crores as compared to 132 Crores last year, which led to a 15% increase in employee cost.
-Currently we have 5200 employees as compared to 4700 employees last year