A Dose of Rakesh Jhunjhunwala

Rakesh Jhunjhunwala on Future of Equity Market

Methinks every Indian Equity Investor needs a dose of Rakesh Jhunjhunwala (RJ) every few years! ~ any sooner it could be an Overdose !  😆 ~ just kidding !

I like the guy ! ~ right since I interacted with him when I invited him around 15 years ago at the turn of this century for interacting in an evening  Q & A session with my packed class of @ 90 participants in my Equity Portfolio Structuring and Stock Analysis Workshop at the BSE Training Institute as I thought he would add practical value & he did

“Boss ! I’m a Sadak Chaap ! ”  he had told us then as also how he had reconstructed his equity portfolio to concentrate only in a few stocks after the 2000 ICE debacle…so in a sense most of his Wealth has grown only in this Millennium in the past 15 years ~ and to his credit in Selections that were not really Blue Chip or Core

Yesterday had gone for an  IMC interactive meet in Mumbai to check out if RJ has sobered & matured in his ‘manner of speak’ over the years ~ I rarely watch Stock Channels ~ don’t even have a TV in office~  so was not really conversant with how & what he delivered in his appearances though knew of his initiating big stakes in companies

I am delighted to blog he has not changed ! ~ shot straight from the hip & mouth again as he always does ” I’m a satodia(translated to mean speculator)  & investor & not an economist” ~ his investment portfolio has spread into the Alternatives of  Bollywood Movie Production too with Kareena & Arjun starrer ‘Ki & Ka’ being his latest co production~ is into horse racing too and owns a few horses ~ passions perhaps where return on investments need not be measured in monies !?

Many perceive him as Dehati or Crude Dude for his rustic loud boorish way of speech~ but don’t let it fool you ! & he does not make any pretenses ~ he’s a CA by training & wears a fairly sharp mind

Money Talks & Crowd Laps it up all !~ many vigorously & ‘knowledgeably’ nodding in agreement

These RJ’s views & responses to questions posed should interest you :

On The Future of Equity Markets ~ Reiterates this is only the Trailer & we are going to witness a Mother of all Bull Runs.India is a thriving young Democracy with US $ 600 b in Savings every year.Equity Markets receive just US $ 50 b from this.This has to improve and it will ~ anyone ,any  doubt!?   

On Returns from Equity  ~ Ironically while his riches have been through multibagger 1000% + equity gains in concentrated high weightage stocks like Titan & Crisil he asserts that one should be happy with 18% CAGR gains and if it goes to 24% one should be really happy read more

Anil D Ambani Reliance Group~Market Cap & Debt ~ Defence to its Defence

Have a Look at the Market Cap (today closing March 28,2016)& Consolidated Debt (September 30,2015) of these Five Listed Companies of Anil D Ambani

Name Of The Company

Market Cap (Rs.Crs)

Total Debt (Rs.Crs)

Reliance Power

13015

31428

Reliance Infrastructure

13747

24645

Reliance Capital

9117

22730

Reliance Communication

12457

35254

Reliance Defence

5098

6884

Total

53434

120941

Rs 120941 crs was the Aggregate Consolidated Long & Short Term Debt of Anil Ambani’s Reliance Five Listed Group Companies as on September 30,2015 while today’s Market Cap is Rs 53434 crs.Aggregate it and you’ll get Enterprise Value without adjusting for any Cash    

Reliance Defence (erstwhile Pipavav) has come into his fold now and a turnaround is expected after CDR was approved ~ RCom is planning to reduce Debt substantially by selling Assets like it’s Tower Business.It also is being supported by Big Brother Mukesh Ambani’s tie ups for Jio Roll outs etc ~ RPower has just declared and paid it’s maiden interim dividend of 10% in December 2015 but continues to struggle to commission Samalkot Power Plant on non availability of Gas ~ Rinfra & RCap are the relatively stabler companies

As long as his companies keeps servicing debt the Banks who have lend will not have to classify the Loans as NPAs….In fact with Anil Ambani planning huge Defence Sector Investments and Growth in his other Companies the aggregate Debt may increase even after Asset Sell offs

Problem is that Anil Ambani has not been enjoying good Investor Credibility after wealth destruction in RCom & RPower & suspected involvement of top management in the 2G Telecom Scam.Investigation continues

The Group’s Market Cap is Rs 53434 crs ~ Compare this with Big Brother Mukesh Ambani’s Reliance Industries that closed today with a Market Cap of Rs 330654 crs

Now his big Focus is on Defence with India having embarked on a Huge Defence  ‘Make in India’ Endeavour opening out FDI  Cap to 49% in the Sector

None of Anil Ambani’s Companies have approached it’s shareholders or the Public for funds after the Reliance Power IPO at Rs 450  in January 2008

None have as None could !

The Reliance Power IPO was a huge obscene premium assault on the Public from which the Public has yet to recover (Quotes at Rs 47 today after a Bonus Issue in 2008 itself  from the Premium collected that adjusted the Price to @ Rs 270!) .The Issue was hyped by the Investment Banker Wolves to create a huge oversubscription.

Of course in January 2011 Anil Ambani had entered into a Consent Plea with SEBI without admission of guilt & was investigated for misuse of Overseas Borrowed Funds and was personally fined and banned access to Capital Markets for a year and Reliance Infra for two years    read more

Wow! A Full House NSE Training Fundamental Workshop !

Wow! A Full House NSE Training Fundamental Workshop yesterday !

Seems to get bigger & better every time !

Did the first one on August 8,2015 and had blogged on it  as linked below

Interesting Interaction at the NSE Equity Fundamental Training Workshop

Sunday, August 16th, 2015

Did this one too on “Interpretation of Financial Statements for Stock Analysis” under NSE’s Rapid Series at their NSE BKC Complex

@ 30 Participants,both genders aged 22 to 58 from leading Broking Firms,Corporates,Banks and even Individuals who had come on dot and stayed till 8 pm ! expecting to learn how to read financial statements and  market dynamics to assess risks and opportunities in Indian Equities

Common Question right from Manish Shah,who introduced himself  to me in the lift going up to the Class ” How are the Markets Looking “? ~ “Where will the Sensex & Nifty head in the short term”?

Had taken a Bull along ! really !…a smaller version of the Wall Street one….told the class I love four animals…Elephants (Lord Ganesha),Lions (My Zodiac Sign),Tortoise(Good Luck & of course Bulls (I’m always one!)….and you’ll always find them on my office desk !…in fact four bulls of various sizes !…and clients know my market view on simply seeing how the bulls are placed !…if facing them straight up  (↑)  as they sit across me,I’m very bullish…if slanted ( ⁄ )towards them,I’m bullish…slant inclination reveals how much !….if a horizontal view (↔ ) then indicates market will remain flat to rangebound and if the bulls face me vertically (↓ ) I’m bearish !….and slant facing me shows intensity of being bearish !

That got a few knowing laughs from the participants and set off the mood for the Workshop with humour being interspersed right through

Interacted on the Sensex Dynamics right from base year 1978 and in the last 20 years from November 1,1995 to October 30,2015 when despite nearly half of the @ 4850 trading days saw the Sensex close negatively the Sensex ran up over 650% !…but is that enough!…..the Opportunities & Threats that were clearly visible during the years right from 1991 when Modern Reforms set in to 2001 when Markets had bottomed  out on the ICE Age Melting to the Sharp drop in Interest rates from 14% to 7% in and around 2004 to post Lehman 2008 levels of 8000 in October 2008 and March 2009….showed them from current Sensex of 26657 how to assess fundamentally where we could be heading and the risks associated….discussed Passive Index Investing vs Active Investing and therefore the need for Fundamental Analysis and therefore the need to Interpret Financials & therefore the need to assess Value vs Price  & therefore this Workshop  ! read more

Superstar Amitabh Bacchan invests a Million Dollars in Nitin Fire at Rs 42.99 !

Wow ! Superstar Amitabh Bacchan has invested nearly a Million Dollars in a Bulk Deal on NSE on August 14,2015 by purchasing 1.5 Million Shares of Nitin Fire Protection Industries at Rs 42.99 !

Consequently Nitin Fire has fired up today 10 % and was on  on upper circuit at Rs 47.05 on BSE and Rs 47.15 on NSE in the morning before opening again only to get back on circuit

Remember how Amitabh had stampeded by buying Two Lakh Shares into BSE Listed Stampede Capital at Rs 88 & Rs 110 levels in December 2013 and see where Stampede is today within a year and a half with long term gains exempt! => Rs 650 levels after crossing Rs 700 recently …that’s a five bagger !

So whats fired up Amitabh Bacchan ! …or is it payment in lieu of Advertising for Nitin Fire just as he took shares of Just Dial at par before IPO and made a killing !

And who’s sold to him ? as it’s a bulk deal in NSE and not a fresh allotment

Nitin Fire Products Industries is a FV Rs 2 Share with a FY 15 Consolidated Book of Rs 15 (moved up in June Q 1FY 16 to Rs 15.67) and an EPS of  Rs 2.3   …Networth is Rs 458 crs as on June 30,2015 with Equity at Rs 58.45 crs

Relative Valuations at Rs 47  work out to PBV of 3 and PE of 20 with Capital Employed of Rs 980 crs as on June 30,2015 spread Rs 343 crs in India and Rs 637 crs overseas

Finance Charges were Rs 41 crs in FY 15 and Rs 10 crs in Q 1 FY 16 but most of the Rs 400 cr Debt is actually short  term and therefore not reflected in Fixed Assets but in Current Assets

FY 15 Consolidated Topline & Bottomline were Rs 1150 crs & Rs 67 crs respectively.Overseas Sales contribute over half.The Company operates two plants at Navi Mumbai & Andhra Pradesh and has operations in Jebel Ali,Dubai and Singapore

They have an enabling provision to raise US $100 m in Equity and in FY 14 saw  a successful buy back of 13.47 lakh shares at Rs 57 average involving Rs 7.7 crs  too.Share was split in 2010 from Rs 10 to Rs 2 after raising Rs 64 crs in a 2007 IPO at Rs 190.Two Bonus Issues ,one liberal 5:2 in 2011 and one of 1:3 in 2014 have been given  to shareholders

Auditors Haribhakti & Co,LLP have qualified their Report for two non provisions being Rs 5 crs for a Derivative Contract Loss disputed with a Bank and Rs 45.76  crs Investment in Worthington Nitin Cylinders Pvt Ltd where the Company has relied on a Valuation Report to recover their Investment but Auditors are unable to comment on any potential Impairment as a Fair Valuation Report as required by Accounting Standard 13 is not available read more

Pipavav on Lower Circuit Rs 68.85 despite or because Anil Ambani taking over !?

Pipavav on Lower Circuit Rs 68.85 despite or because Anil Ambani taking over !?

Pipavav under CDR with Heavy Debt,Huge Capacities but Few Orders to serve the Debt was up for sale and Mahindras & Munjals were interested if there was Debt Restructuring

However listed Reliance Infra &  it’s unlisted Reliance Defence of Anil Ambani has bought out most of Pipavav Promoter’s Stake at Rs 63  and will make an open offer to Other Shareholders for another 26% at Rs 66

This announcement was made post market hours yesterday

Pipavav which was hovering in the mid 70’s for a week  opened this morning down 10% on the lower circuit at Rs 68.85  on both NSE & BSE

Is this because the Buyout  & Offer Price  was lower  that yesterday’s closing of Rs 76.45 !?

This could be one reason…..but think about this ….after the Reliance Power IPO and post IPO mess up where Shareholder Wealth has been destroyed in the past five years  Anil Ambani had eroded a lot of his market credibility ~ Reliance Power is currently down at just Rs 60 from an IPO Price of Rs 450 which adjusts to @ Rs 270 after a Bonus from Premium collected to appease IPO Allotees !

He & his companies  were even banned from accessing the Capital Markets after a consent fine of Rs 50 crs for misuse of ECB Funds overseas

This begs the question…can Anil Ambani redeem himself with Pipavav Defence  even as his Power Company is Powerless yet in a sense ! ~ Market is ruthless and has given a huge thumbs down today !

Contrast this with the entry of Sun Pharma’s Dilip Shanghavi in Suzlon at Rs 18 last month with an Open Offer to coming at this price ~ Suzlon raced away over Rs 25 on this announcement !

Incidentally after Sun Pharma Price shot up yesterday,Dilip Shanghvi (US $ 21+ billion) overtook Mukesh Ambani (US $ 20+ billion as the Richest Indian

Don’t you wish even Dilip got into Defence ! 🙂

So which Anil Ambani Company now do you prefer at Rs 60 to Rs 70 ! ~ Reliance Power or Pipavav ! ?

 

Super ! 23 Participants with 40 Stock Selections for 2015 in the TAP GAP Poser

Super ! 23 Participants with 40 Stock Selections for 2015 in the TAP GAP Poser

TAP GAP Poser End 2014 ~Which Indian Company Will Be A Big Share Price Winner In 2015?
December 15th, 2014

I shall shortly pick a gauravblog hamper Winner or maybe two where I see maximum gain potential in 2015 from the following

Participant wise

Sr No

Participant

Recommendation

Date of Recommendation

Price in Rs when recommended

1

Sumit Khanna

Subros

15.12.2014

67.85

PTC India Financial Services Ltd

17.12.2014

56.4

2

Jigam Gandhi

Wendt India

15.12.2014

2000

3

Sandeep Gahandule

Nathbiogene

16.12.2014

130.55

Prima Plastic

17.12.2014

56

JM Financial

18.12.2014

47.6

4

Bhaskar

IPCA Labs

16.12.2014

723.55

5

Nitin

Ajanta Pharma

16.12.2014

2528.65

Atul Auto

16.12.2014

601

6

Anand

Raj Rayon

17.12.2014

0.66

Jubilant Life Sciences

30.12.2014

119.95

7

Prasad

Nbcc

18.12.2014

792.05

Capital First

30.12.2014

353.4

TV Today

30.12.2014

215.2

8

Rohit

 Adani Enterprises

20.12.2014

452.05

9

Prasad Shetty

Multibase

21.12.2014

227.9

10

Kushal Shah

MCX

22.12.2014

838.95

Jet Airways

22.12.2014

389.7

11

Rajan

Motherson Sumi Systems

22.12.2014

440.2

12

Hemant

NETWORK 18

22.12.2014

66

Intellect Design

22.12.2014

75.6

Pipavav Defence

22.12.2014

39.75

13

Raj

Odyssey Technologies

22.12.2014

33.65

14

Shiva

Granules India

23.12.2014

777

Mayur Uniquoters

23.12.2014

415.4

SpiceJet

23.12.2014

19.3

15

Abhay Tewari

Suzlon Energy

23.12.2014

13.45

16

Pushkar Prasad

Freshtrop Fruits

24.12.2014

115.9

17

Dhiren

Tata Sponge

26.12.2014

680

18

N Sri

Deccan Gold Mine

28.12.2014

42.95

19

Sameer

Spicejet

30.12.2014

17.95

Deccan Gold Mine

30.12.2014

44

Muthoot Capital Services

30.12.2014

207.15

20

Shahzad V

Engineers India Ltd

31.12.2014

229.75

AkzoNobel

31.12.2014

1384.1

Aries Agro

31.12.2014

117.4

21

Kiran

Vidhi Dyestuffs

31.12.2014

17.16

22

Vishal Kejriwal

CCL Products

1.1.2015

170.95

Oriental Carbon Chemical Ltd

1.1.2015

361.55

Hinduja Global Solutions Ltd

1.1.2015

631.75

23

Rudra Tandan

Ram Ratna Wires

2.1.2015

48

Foseco

2.1.2015

1227.55

Alphabetical Scripwise

Sr No. Scrip Recommended for 2015 Price in Rs when recommended Participant
1 Adani Enterprise 452.05 Rohit
2 Ajanta Pharma 2528.65 Nitin
3 Akzo Nobel 1384.1 Shahzad V
4 Aries Agro 117.4 Shahzad V
5 Atul Auto 601 Nitin
6 CCL Products 170.95 Vishal Kejriwal
7 Capital First 353.4 Prasad
8 Deccan Gold 42.95 N Sri
9 Deccan Gold 44 Sameer
10 Engineers Ind 229.75 Shahzad V
11 Foseco India 1227.55 Rudra Tandan
12 Freshtrop Fruit 115.9 Pushkar Prasad
13 Granules India 777 Shiva
14 Hinduja Global 631.75 Vishal Kejriwal
15 Intellect Design Arena 75.6 Hemant
16 Ipca Labs 723.55 Bhaskar
17 JM Financial 47.6 Sandeep Gahandule
18 Jet Airways 389.7 Kushal Shah
19 Jubilant Life 119.95 Anand
20 MCX India 838.95 Kushal Shah
21 Mayur Uniquoter 415.4 Shiva
22 Motherson Sumi 440.2 Rajan
23 Multibase India 227.9 Prasad Shetty
24 Muthoot Cap 207.15 Sameer
25 NBCC 792.05 Prasad
26 Nath Bio-Genes 130.55 Sandeep Gahandule
27 Network 18 66 Hemant
28 Odyssey Technologies 33.65 Raj
29 Oriental Carbon 361.55 Vishal Kejriwal
30 PTC India Financial Services 56.4 Sumit Khanna
31 Pipavav Defence 39.75 Hemant
32 Prima Plastics 56 Sandeep Gahandule
33 Raj Rayon Ind 0.66 Anand
34 Ram Ratna Wires 48 Rudra Tandan
35 SpiceJet 17.95 Sameer
36 SpiceJet 19.3 Shiva
37 Subros 67.85 Sumit Khanna
38 Suzlon Energy 13.45 Abhay Tewari
39 TV TodayNetwork 215.2 Prasad
40 Tata Sponge 680 Dhiren
41 Vidhi Dyestuffs 17.16 Kiran
42 Wendt 2000 Jigam Gandhi

Note :

  1. Sandeep Gahandule who just won the hamper for Alphageo’s spectacular 720% run in 2014 has contributed three selections for 2015 this time too
  2. Anand,who ran neck to neck with Sandeep till November 2014,when his low priced Rs 7 YBrant  was up against Alphageo has yet again given one really low priced selection Raj Rayon of just 66 paise !
  3. Deccan Gold & Spicejet occur twice as they constitute selections from two different participants
  4. Prices at which Recommended have either been provided by the Participant when making the Reco and reflect the current market price at the time or where they have not stated the price,the last price when they made the reco has been sourced from the BSE & NSE
  5. Most have not given targets for 2015 Selections but the four selections that have been given targets and all are  over 100% + except one,are as follows : Freshtop Fruits Rs 250,PTC India Financial Services Rs 90,Subros Rs 150 and Tata Sponge Rs 1500+
  6. Adani Group finds representation but none from the Ambani Groups ~ perhaps realisation that Reliance Ind has been a losing 5 year Investment thus far and ADAG Companies have struggled
  7. Tata Sponge is the lone entry from the Tata Group.
  8. Media and Aviation have two each in Network 18 and TV Today and Jet Airways & Spicejet respectively
  9. Pharma & Auto Ancilliaries & NBFCs &  IT  & Speciality & Commodity Chemical Sectors are well represented
  10. Can see a few potential turnaround selections as well as a few that have already run up huge in 2014
  11. Tea & Coffee Beverages & Renewable Energy & Defence are represented but none from direct Power,Telecom or Real Estate or Retail
  12. No Bank & no Oil & Gas Major  & No visible Large Cap ! but Three Selections are also traded in the Derivatives Segment,namely,Adani Enterprise,Engineers India & Motherson Sumi

Going to be an interesting few days filtering all the above