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Opinionated professor in his virtual classroom.
Vik Profile picture Technical Fundamentalist Profile picture YJ Profile picture pradeep gowda Profile picture Mohit Gaur Profile picture 76 added to My Authors
Mar 24 4 tweets 1 min read
Some questions. How can a non-compete fee paid to the promoters of a selling company be fair to its minority shareholders when they get an open offer to sell their shares at a much lower price? Fairness means all shares are equal. No? Explain.
Jan 24 5 tweets 1 min read
This is such an interesting distinction between private and public markets. In public markets new shares for cash of a company already listed can only be offered at a DISCOUNT to prevailing stock price. Why should public market investors buy stock in a listed company at 150 bucks when they can buy it from the market at 100 bucks?
Jan 15 10 tweets 2 min read
There are two types of templates/patterns here. The first one is the "Peloton template." This is an example of a business that didn't make any money - not even in a boom year.…. And yet, in December 2020, during covid times, its market cap exceeded USD 50 billion.
Jan 15 4 tweets 1 min read
That cycle turned quickly. Zoom and Doom (for those who bought at or near peak)?
Dec 27, 2021 5 tweets 1 min read
Mail from RBL Bank MD & CEO (Interim). Assume this is true (I hope it’s true). Key words: “Any other financial parameter.” Image Now ask: Why was the existing CEO asked by RBI to proceed on leave and why did it appoint Mr. Yogesh Dayal as an Additional Director on the Board of the Bank?
Dec 27, 2021 21 tweets 3 min read
There is never just one cockroach in the kitchen. This is factually incorrect. If you take out all but one of the cockroaches from the kitchen, then there will be just one cockroach in the kitchen. 🤣 But the metaphor of "there's never just one cockroach in the kitchen" is valid for business and investment analysis.
Nov 24, 2021 11 tweets 3 min read
Let’s make no bones about this. On INR 420 cr. of revenues in FY 21, Licious lost INR 370 cr. Trying to disrupt a model (local butcher shop) which has been around hundreds of years (think Lindy effect) requires u too not only sell at a price not too different from local butcher price but also to spend a bomb on logistics, packaging, and customer acquisition (advertising)
Nov 17, 2021 9 tweets 2 min read
Help is needed from fellow value investors! Am working on a new course @FLAMEUniversity which might be titled "Case Studies in Business and Investment Analysis." As of now, just making a list of various themes/patterns. Here is a work-in-progress list: 1. Real B2C brands;
2. Superficial B2C brands (which it was thought that the brand loyalty will last but it didn't)
3. Low-cost producers (Fisher);
4. High-cost producers (Graham)
5. Cyclical turnarounds;
Oct 4, 2021 5 tweets 1 min read
Read a few media stories on what's happening in spot markets in nat gas that do not mention anything about what's happening in the futures market. For example, see price in April 2022. Image Whenever shortages appear, the typical manager simply can’t wait to expand capacity and thereby plug the hole through which money is showering upon him." - Buffett
Sep 12, 2021 4 tweets 1 min read
If you think about it, we successfully multitask a lot of the time. Walking and talking on the phone for example. When we drive we can’t just focus on the steering wheel or the rear view mirror. Our moms and grandmoms multi tasked seemingly effortlessly. Just think of a typical day in their lives when they were married, had kids, and had a home to run.
Jun 27, 2021 18 tweets 3 min read
This I agree with. While 100 Baggers by @chriswmayer is a fabulous book, there is a need for literature on building the conviction to hold. And it’s not easy to develop a conviction to hold on to things that should be held. There are these “demons” that will enter the mind of the investor, which will prevent them from holding on to what will turn out to be an outstanding stock.
Jun 16, 2021 13 tweets 2 min read
Don’t take credit risk. Stick to quality companies. Hmmmm Are HDFC Bank and Kotak Mahindra Bank quality companies? If so, then did they become so without taking credit risk? Answer: No.
Jun 5, 2021 10 tweets 2 min read
Technically speaking it’s possible. In a tobacco litigation scenario, if courts decide against the company and award huge damages, then litigants can go after all its assets. But the taint of tobacco is removed from non tobacco assets if they are separated from the tobacco operations with ITC tobacco having no stake in them.
May 23, 2021 18 tweets 3 min read
Well, there is lots of disconfirming evidence here - and not just for platform companies but also from other businesses. Take the examples of Uber and Airbnb for example. When they started out, they not only took on entrenched players (taxi operators and hotels), they also took on regulations.
Dec 18, 2020 15 tweets 3 min read
One of the favourite case studies that come up in my BFBV course at MDI is Relaxo. Every year I ask students to study this case which I had done along with @ravirpurohit in 2013 by assigning these readings:……… Then I update them on my thinking about this business, management and valuation. This year, I spoke that (which I won't discuss here) and also about some additional lessons. Listing them here:
Dec 7, 2020 6 tweets 1 min read
I found this useful:

Good value for money. Incidentally, lots of other stuff can be done with this data. For example, if we know P/E and P/B, then we can derive E/B or ROE. And plot it over a period of time. It will be quite revealing if you do that.
Nov 19, 2020 8 tweets 2 min read
One student in my Forensic Accounting course wrote about manipulation in many large companies and how it pushes the retail investor into the corner. My (slightly edited) response: All investing carries risk. Equity investing is no different. But look at the world around you. If you really want to compound your capital and beat inflation and make some real money, you have to invest in equities - which includes owning 100% of your own business by the way.
Nov 19, 2020 21 tweets 4 min read
Really enjoyed learning from @nrmangal in his class to my students in my Forensic Accounting course at MDI. Thanks Neeraj. Here is a link to a book recommended by Neeraj.
Nov 18, 2020 5 tweets 1 min read
Does anyone want to answer this? One answer is that company engages in hedging by using derivatives as a legitimate business decision and claims the hedging cost as a tax-deductible expense.
Nov 11, 2020 11 tweets 2 min read
Very valid points made by you. In the class, the example is a bit more elaborate. For example, I include "hafta" as a necessary expense. Now let me try to address your concerns. In the original example the street vendor has fixed assets of 10k, inventory of 1k, margin over cost of 100%, and one day's revenue Rs 2k. Depreciation Rs 50. And Profit was Rs 950. Annual profit assuming 300 days of work was Rs 2.85 lacs. and the ROCE is an astonishing 2,590%
Nov 9, 2020 14 tweets 2 min read
Three things happened in Q2. One, there was pent up demand in Q2 because of shutdown in Q1. So earnings which would have occurred in Q1 moved to Q2. This is temporary.