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November 2015

Wow ! Brian Chesky of Airbnb on what it took & takes !

Wow ! Brian Chesky of Airbnb on what it took & takes !

A Class in Stanford recently that  was an interview by Reid Hoffman of Brian Chesky — the founder and CEO of Airbnb.

Airbnb Founder Brian Chesky in conversation

 

Inspiring Takeaways from this Interview in a Class at Stanford

A number of people have told me that Airbnb is the worst idea that has ever worked

Before Airbnb I was different than most tech founders because I went to art school at the Rhode Island School of Design (RISD) and studied industrial design.

My parents were both social workers and when I told them I was going to art school they were sure I was going to move back home. My parents always told me if I got a job I should make sure I got one with health insurance. That was the extent of my perceived ambitions.

 However at RISD they told you because you were a designer, you could change things — that I could go out and do and change anything I wanted to do.

After school I got a job and one of my college friends Joe Gebbia kept trying to convince me to leave my job and move to San Francisco to do a startup. We had no idea what we wanted to do but we knew we wanted to do something. When I told my roommates I was leaving they thought I was crazy and needed an intervention.

At the time, I had $1,000 in my bank account and I drove to SF, this was in 2007. Upon arriving to San Francisco I had learned my portion of rent for the place we had was $1,200 so I literally didn’t have enough to pay rent. 

we had no money — so what if we created a bed and breakfast for the design conference. The problem with this idea was we didn’t have any beds — however we did have 3 inflatable air beds. This is where we came up with the name “Air bed and breakfast” and our first site wasairbedandbreakfast.com.

The core idea was — what if you could book someone’s home just like you could book a hotel room, anywhere in the world.

We didn’t have this flash of inspiration that Air bed and breakfast was going to be huge. In fact we started building a different product — a roommate search tool. We worked on this for 4 months and then realized “roommates.com” had already built this service. I couldn’t believe how much time we wasted on this before checking the URL roommates.com

I learned that being an entrepreneur and being unemployed is just a difference in mindset

One thing I learned is, big ideas sound stupid in the beginning. I’ve always heard that if your idea is any good there is no problem with sharing it because people will dismiss it. Many ideas come from solving your own problem which aren’t life changing problems — but these ideas could potentially become life changing ideas. read more

Tree House Education up Shit Creek & Down Market Big Time at Rs 169

Tree House Education up Shit Creek & Down Market Big Time at 20 % lower circuit today of Rs 169

70% of Wealth Destroyed in nine and a half months from 52 Week High of Rs 548 on BSE & Rs 559 on NSE recorded on February 16,2015

No Kidding ! & Excuse the Pun !

It surely is a terrible Friday for Geeta & Rajesh Bhatia who created the Company

Trading Volumes are 10 times the daily average past two weeks indicating huge and relentless selling

52 Week High on BSE was Rs 548  mid Feb 2015 and today’s Rs 169 is the 52 week low….NSE recorded a 52 week high of Rs 559 in mid Feb 200

Look at the the Irony ! CARE has upgraded their long term debt rating from A- to A

But Markets have downgraded them big time !

So the Big Question ? Why this Big Sell Off today !?…BSE recorded 2.44 lakhs shares with 42% delivery while NSE recorded over 13 lakh shares with @ 50% marked for delivery !

It  must have to do with loan topping by the Bhatias 

The Company’s Long & Short Term Debts of Rs 59 crs & Rs 119 crs as on September 30,2015 are secured by Company Assets & September Networth is Rs 679 crs giving a Book of Rs 160 a share

Long Term & Short Term borrowings are secured by mortgage of Land, building, office premises, hypothecation of movable assets, book debts, both present and future of the Company.A part of the short term borrowings are also secured by a fixed deposit.Nowhere does the FY 15 Annual Report state that such borrowings are also secured by Promoter Pledge of Shares.So for what Loans have the Promoters pledged their shares ? Private?

PBV is heading below 1 from credible and solid levels of 3.5 earlier in the year.Company makes monies and raised dividend to 20% in FY 15 though there was some controversy on the high value of Receivables which was clarified by the Company as staggered payment by clients for K-12 Revenue Stream and accepted by Stakeholders Empowerment Services (SES) who had raised the query

So then what is the nature and purpose of the loans taken for which the pledge has been made by the Bhatias to the lenders like Ambit Finvest,Capital First,STCI Financial,Kotak Mahindra etc ?

Bhatias own 29.97% of the Equity of Rs 42.31 crs at September 30,2015 holding 12680069 shares of which they had pledged  5482000 or 43.23% with the lenders

Their latest notification to BSE reveals 6467000 shares pledged .As Tree House Share Price kept crumbling they were forced to provide additional security and create further pledges and encumberances on the same loan.In October & November 2015 an incremental 985000 additional shares were pledged .Now 51% of the shares Promoters hold are pledged ….Rajiv Bhatia has pledged nearly all his holdings and some held by  wife Geeta Bhatia read more

SEBI keeps convicting Arun Jain of Polaris of Insider trading but what is the use !

SEBI keeps convicting Arun Jain of Polaris of Insider trading but what is the use !

For a 2000 Insider Trading Matter,SEBI had passed an October 9,2012 Order barring Arun Jain from Capital markets for Two years only to see SAT set aside this order on December 23,2013

Now on November 24,2015 SEBI has again indicted Arun Jain for Insider Trading in 2008 and levied a Penalty of under Rs 2 crs on on him !  

What’s the use !.. for two clear reasons….justice delayed is justice denied …. & he may appeal this too!

Arun Jain keeps moving on in life !

In 2014  he demerged Polaris’ Products division to Intellect Design Arena which listed last year in December 2014 at Rs 50 to Rs 60 levels and in a lack lustre 2015 has raced away  six times to Rs 300 + earlier this week and closed at Rs 284 today

In 2015 recently he,along with a few other shareholders sold their 53% stake in Polaris for Rs 1173 crs to US based Virtusa Corporation    in what he has described as the most important decision he has made in his life

Who will continue having the last laugh !…..your guess would be right !

Sugar Scrips on Fire ~ Humming Sugar Sugar… & you got me wanting you !

Sugar Scrips on Fire  even as Sensex tanks @ 382 points & 1.48 % to close lower at 25483

Humming the Archies classic “Oh Honey! Sugar Sugar You’re my Candy Girl & you got me wanting you !”

Look at the Sweet Sweet Returns if you’d made the call on this commodity just a month or two ago when Global Prices have been rising dramatically and the Indian Government has allowed Sugar Exports to realise these prices

Just look at these 14 Sugar Scrips on Fire on BSE !

Dwarikesh & Simbhaoli closed at their 52 Week Highs today while several others recorded their 52 Wk Highs before closing marginally lower !

Interestingly EID Parry has not gained till date in 2015 having opened at Rs 202 levels and closing today at similar levels

Sugar Sector has been a Multibagger one this year !…in fact in just one or two months of investments one would have raked in three digit % returns in Sugar Scrips !

 

SUGAR SCRIPS ON FIRE !

Scrip Name

 

Mkt Cap

(Rs Crs)

FV

(Rs)

52 Wk

High

52 Wk

 Low

Jan1 2015

Nov18

2015

 

%

Day

  

%

2015

 

%

from

52 wk low

Sensex

 

 

30025

24834

27486

25483

-1.47

-7.3

2.6

Nifty

 

 

9119

7540

8273

7732

-1.35

-6.5

2.6

 

 

Rs 

 Rs

Rs 

Rs 

 

 

 

Bajaj Hind Sugar

1768

1

25.2

11.01

19

21.65

-2.73

13.9

96.6

Bannari Aman

1401

10

1420

575

1163

1225

-1.1

5.3

113.0

Balrampur Chini

2024

1

85.4

33.45

60

82.65

14.63

37.8

147.1

Dalmia Bharat

565

2

76.70

16.10

22.7

69.85

-1

208

334

Dhampur Sugar Mills

423

10

74

27.4

43.4

72.2

3.69

66.4

163.5

Dwarikesh Sugar

147

10

89.9

19.1

28.35

89.9

4.96

217.1

370.7

EID  Parry

1950

1

244.5

123

202.6

201.65

-6.17

-0.5

63.9

Oudh Sugar

108

10

44.2

14.2

19.9

41.75

4.76

109.8

194.0

Rajshree Sugar

89

10

39.5

14.4

22.9

37.55

3.18

64.0

160.8

Sakhti Sugar

37

10

35.1

12.2

16.7

33.35

-0.15

99.7

173.4

Shree Renuka Sugar

1618

1

20.4

7.03

15.35

17.42

8.54

13.5

147.8

Simbhaoli Sugar

68

10

24.05

7.6

14

24.05

9.82

71.8

216.4

Triveni Engineering

956

1

39.8

14.4

23.5

37.05

8.18

57.7

157.3

Uttam Sugar

128

10

34.4

9.14

15.5

33.7

-0.6

117.4

268.7

What now going forward into 2016 !? Can One yet Consider hopping on to the Sugar Bandwagon even now?

Well a few sugar sector analysts expect a good run for the next two years after a cyclical bad time past few years….just like the Aviation Sector that has returned to spectacular profits as Oil prices halved and thus halving Aviation Turbine Fuel Prices that make up @ 50% of the Costs

These Commodity Cycles are tricky to gauge & hence the huge Volatility swings over time…literally Sugar is not in everybody’s cup of tea !…probably only those aggressive

If considering to increase or initiate exposure in the Sugar Sector,just do your Homework on Potential Non Linear Profitability coming up in Sugar Companies going forward and assess how much of this euphoria is already reflected in current Share Prices…many companies are in the restructuring stage after some gruesome years battling low sugar prices and high indebtedness & losses….many crippled factories have even shut down

Otherwise you could land up being a victim of ‘Herd’ Mentality because you just ‘Heard’ !

However  my intention is neither to scare you nor to make you excited !

Just don’t put 14 spoons of Sugar in your Tea !  

 

EROS reads SORE Backwards ! ~ On Lower Circuit at Rs 213 ~ S’o’rely facing Class Action Sore time !

EROS reads SORE Backwards ! ~  On Lower Circuit at Rs 213 ~ S’o’rely facing Class Action Sore time !

EROS Media is listed on NSE & BSE where it’s reeling at 10% lower circuits of Rs 213.75 & 213.85 respectively

The FY 15 Annual Report Boasts of  ‘The Big Picture’ of Producing Hit after Hit ! & in Investing in Winning Scripts !

The Reality Now is that’s it’s a Rapid Losing Scrip taking Hit after Hit !

The reason is the US Class Action suits launched by many  US law firms to recover  loss for Investors from Investments in the period June 17,2014 to October 30,2015  and some suits also carry the days from November 2013 at the IPO time to current November 2015 in the NYSE listed EROS INTERNATIONAL PLC  & here & here & here 

The NYSE Listed EROS  has dropped by 45%+ in just five days and over 66% from January 1,2015 this year to just over US $ 7 currently .It was US $ 39 on August 13,2015 just three months ago

Those Indian Broking Firms who have recommended Eros Media for Investment in India are now recommending an Exit !

Pray how does one exit on lower circuit !?….stand in the queue to sell and pray your order gets executed

Eros International Media Listed on BSE recorded a 52 Week high of Rs 644.40 on July 20,2015 just four months ago & is down over 66% from this high to lower circuit of Rs 213 today

Here are some of the accusations stated in the US  lawsuits and in critical reports  and they are seriously serious and reek of  acute Corporate Governance Issues and violation of US Federal Securities Laws by the NYSE listed EROS INTERNATIONAL PLC :

  1. Defendants issued materially false and misleading statements to investors and/or failed to disclose that: (i) Eros’ reported earnings significantly overstated the economic viability of Eros’s business model; (ii) Eros’ accounting policy for amortization was unjustifiably aggressive in light of the impact of piracy on the long-term value of Eros’s assets; (iii) despite Eros’ reported profitability, Eros generates no cash; (iv) Eros has only been able to stay afloat by issuing stock and taking on debt; (v) Eros significantly overstated the number of Eros distributed and Eros’ theatrical revenues during fiscal years 2014 and 2015; and (vi) as a result of the foregoing, Eros’s public statements were materially false and misleading at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.
  2. The above accusations leveled  in the lawsuits drew from an October 30 2015 report  that was published on Eros International Plc  by an investment blog Alpha Exposure asserting, among other things, that: (1) reported earnings are significantly overstating the economic reality of its business model (2) The financials of  subsidiary revealed a lack of free cash flow and raised many questions about the company’s accounting and (3) Company has enriched the promoters’ family at the expense of shareholders through a series of related-party transactions. Further, on November 10, 2015, Seeking Alpha reported that Eros International Plc has overstated its theatrical revenue by 82% and 104% during fiscal years 2014 and 2015, respectively and overstated the number of movies it has distributed by 124% and 200% during fiscal years 2014 and 2015, respectively.

 Eros International Media has just declared it’s half year results at September 30,2015

There is no mention of the class action suit developments in USA as the Interim Results are dated November 9,2015 while Law Suits are dated after this.However what started this whole Problem was the Critical Accusatory Report of Alpha Exposure of October 30,3015

There is as required,mention of 14 Investor complaints received in the July to September 2015 quarter and none remained unresolved at September 30,2015….what was the nature of such complaints and whether they were resolved to the satisfaction of the Investor is not known

EROS is promoted by Sunil Lulla who serves as Vice Chairman & MD.The Promoter Holding is 73.66% as on September 30,2015 while another 8.2% is held by 5 other Institutional Shareholders as on the date

The auditors,Walker Chandiok & Co LLP,  have given a clean review of the interim FY 16 results and have relied on the review of the interim results of the 12 subsidiaries and step down subsidiaries by other auditors.Their Audit Report of FY 15 also does not carry any qualifications or reservations or adverse remarks read more

Grand Power Packed Sunday Afternoon with a 1000 people

It was a grand power packed Sunday Afternoon at Sofitel BKC’s Banquet Hall with a friend couple hosting a pre wedding lunch for the FM &  his wife’s daughter & her husband to be….congratulated them & wished them all the best & caught up with a lot of friends and acquaintances,many of them ‘Who’s Who’ in the World of   Politics,Business,Medicine,Education,Media,Banking,Equity,Broking,Bollywood & Music &….exchanged pleasantries with some & banter with others ! ….it was a heady cocktail mix !….so you can consider this blogpost as a hangover !

It was interesting to catch up with the NextGen too ,children in their 20’s of friends in their 50’s….hey guys don’t address me  with “Hello Uncle “….makes me feel old !

There must have been over a 1000 enjoying the exquisite & extensive hospitality of the Hosts  !……felt warm when the hostess said “Gaurav, the Aloo Gobi’s just for you !”…& there were a 1000 dishes of  various world cuisines  to choose from  in a 360 degrees presentation around  the Banquet Hall on the outside !….the party was all over the  2nd Floor !…..our friend and hostess is humble and down to earth and has a Heart of Gold ….it’s a common perception that one born into an illustrious political pedigree would throw weight…not her !….earlier this year in February she was responsible for ensuring our once in a lifetime ‘Mata kaa Bulava Aaaya Hai’ Vaishnodevi Jatra was indeed a lovely & memorable one !….,a year  ago when I had jocularly told her I missed her Aloo Gobi ! she actually send not just the Aloo Gobi but Paneer Makhanwala too over to our residence that could feed an army !…she’s deeply religious too & an ardent worshipper of Siddhi Vinayaka & Infant Jesus & St Anthony… like we are too…. Every Tuesday is specially marked for a visit to the famed Prabhadevi temple & Worli Shrine  for Prayers to both

Wife was amused when an elderly man came up to me and hugged me saying ” I’m very proud of you!….you come on TV and are very knowledgeable ” and  kept repeating this even when it turned out to be a case of mistaken identity !…so I hugged him back !

And an Equity Guy who’s sought frequently for his views on and off TV enquired ” Gaurav , What’s your big scrip!?  but excused himself when asked for his ! read more

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