After many requests over the year to share my research with larger audiences and not just the institutions,

I am happy to announce that we are starting "Ridge Research" focussing on Small and MidCap Companies Why Ridge Research : Am I not a forensic Guy ?

When we read the primary sources , we are looking at the business from the lens of a risk manager & an investor. We are interested in the business potential of companies & also are vigilant on accounting & governance.

A Thread on Shakti Pumps analysis done in 2019:
Vintex Tools Private Limited (VTPL) a promoter owned company seems to be funded by Shakti Pumps Ltd. 2/n
VTPL largest customer is none other but Shakti Pumps itself which has been purchasing in hefty amount every year. Average net profit margin last 5 years is as high as 39.3%.

Thread on work done on Shankara in F19:

The auditor gave a clean report on verification of FA, The question comes in our mind that if a company does not have FA register with quantitative and location details, how come the management was able to verify them? 1/n EBIDTA per sqft for the retail segment has not seen a significant uptick in EBIDTA margin for F18. Management in its Q4F18 earnings call suggested that as the area per store has increased to ~5,000 sqft from 4,000 sqft, EBIDTA margin per sqft might not depict true picture. 2/n

A short thread : How companies artificially boost ROE and ROCE

Recently, few companies claimed that they have superior return ratios (ROCE and ROE) compared to peers...which catches attention of most of the investors/analyst. 1/5 However, these companies have not generated enough cumulative FCF in last 10 years (adjusted for the acquisition). Still ROCE and ROE looks better.. why?

2/5

How companies fudge operating cash flow a small thread...
@abhymurarka @PuneetK009 @ashwinidamani @abhymurarka @PuneetK009 @ashwinidamani 1.Classification of Acceptances under operating activities. Acceptances are kind of short term working capital loan which should classified under financing activities. (this is most commonly used)

Classic case of a listed company run by PE -

1. Discloses related party dealings in more detailed manner - analysts 👍

2. Promoter owned company doesn’t make any superficial gains from RPT. - Analyst call it professional and clean management 3. Listed company does margin management through dealing with this promoter owned company

4. Everything looks rosy - analysts 👍

5. No one cares to look at funding pattern and financial position of promoter owned company🤔

6. Promoter owned company is at verge of bankruptcy

Reading annual report of #Wirecard ...let’s see what is says🤔 #Wirecard annual report pointers:
1
It had €3.3 bn cash and bank balance as at 9MF19... average yield on cash and bank balance is 0.3% since F10.
2. Alongwith increase in cash and bank balance over the years, company debt levels have also increased to €1.85 bn.