Tar ⚡ Profile picture
20 Jul, 4 tweets, 2 min read
There are many reasons to sell, but only one reason to buy.

Jubilant Ingrevia's promoter bought significant stakes just a month back.

Earnings Call today at 5pm IST.

Company still branded as commodity chemicals when it derives ~50% of its revenue from specialty chemicals.
Results, Earnings Commentary and Presentation 👇🏼

Most of the EPS increase this Quarter is due to increase revenue from Life Science Segement.
LS revenue grew mainly due to global increase in Acetic Acid prices and they had stock.

Not sure how sustainable is Rs10 EPS / Quarter.

Still good progress in overall business.
Storms in US states, lead to high prices for Acetic Acid. Don't think next Quarter we will see such a high EPS.

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More from @itsTarH

19 Jul
There is probably around 1 stock out of 100 that will give you a 100x return in over 10 years

That means out of 4000 listed stocks, there are less than 40 stocks that will turn 100 baggers in year 2032

40/4000 = Less than ~1%

You have better luck winning a lottery!

Aim Low.
A 100 bagger needs following characterstics

1⃣ It's unloved by the market
2⃣ It's not discovered and unknown
3⃣ Nil institutional ownership
4⃣ Management can dream big
5⃣ Management can execute
6⃣ Promoters are honest
7⃣ Business evolving into newer products
Few 100 baggers of Last Decade include

Deepak Nitrite
Bajaj Finance
Relaxo (almost a 100 bagger)

Nobody knew or loved them in the year 2010, very few discovered them, even fewer held onto them for an entire decade to deliver 100x returns.
Read 5 tweets
17 Jul
It's the weekend!

Grab a cup of coffee, in this thread I will explain

1. Peter Lynch's Six Categories of Stocks
2. How to identify the type of stock you own?
3. How to think and decide about the runway for growth of a company?

Lets dive right in.
For those who do not know (I doubt there will be many), Peter Lynch is one of the most successful fund managers of all time.

He managed a fund called Magellan at US Investment Giant Fidelity Investments and during his 13 yr tenure, he delivered an average CAGR of 29.2%.
Sadly the fund couldn't keep up post Lynch's retirement and his successors weren't able to keep up with his returns.

That's how good Lynch was!
Read 74 tweets
15 Jul
Guess the Sector, that this company operates in.

ROCE 1 Yr: 32.7%
ROCE 3 Yr: 24.8%
ROE: 27.4%
ROE 3 Yr: 19%
Op Margin: 28.4%
Reserves: 32% of Current Market Cap
Debt: Nil
Profit CAGR 3Yrs: 54%
Debtor Days: 15
Inventory Turnover > 5
CFO YoY Increase : 160%
Some of you got it correct. Its Anjali Portland.
The company just acquired another cement company that will double the total sales immediately.

The acquisition was financed by adding debt, so interest costs from next quarter will go up but still great!
For a company that operates in a cyclical sector like cement!

What I liked is that the company was able to maintain the balance sheet and margins even in a down cycle.

With real estate sector reviving, this can be a great bet from here.

No recommendations, just an observation.
Read 6 tweets
10 Jul
It's the weekend!

Grab a cup of coffee, in this thread I will explain

1. What is Dupont Method for ROE?
2. What is the difference between ROE, ROCE and ROIC?
3. How to identify companies that will improve their ROCE in future?

Lets dive right in.
Believe it or not, DuPont method for ROE was introduced to capital markets by the chemical company, DuPont (duh) in the 1920s.
A DuPont explosives salesman called Donaldson Brown invented formula for an internal DuPont efficiency report in 1912.
Read 41 tweets
9 Jul
China Index has corrected ~40% since its peak
Lot of regulatory crackdown in China. Top rated companies are available for huge discounts. $BABA for example now has a market cap of less than 600 Billion and is bigger than Amazon in every regard.

I have been aggressively investing more in Chinese equities than Indian ones.
Read 4 tweets
8 Jul
Lot of IPOs hitting the market. As a general rule, I stay away from applying for IPOs. Here are a few reasons why 👇🏼

1️⃣ Companies are dressed up a year or so before IPO to allure investors

2️⃣ Insiders get an opportunity after waiting for years to liquidate their investment
3️⃣ Most IPOs are aimed at giving insiders an exit rather than raising growth capital for a company

4️⃣ I look at IPOs 3 to 4 quarters out, this gives me enough clarity on what the company has done post raising funds. By this time insiders had liquidated whatever they wanted to.
5️⃣ The initial exuberance dies down post 3 to 4 quarters and price action settles down

This strategy has worked out for me quite well and has prevented me from sucking into the euphoria of market.
Read 4 tweets

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