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A Lion’s eye on the Bulls and Bears

“In India, companies may fall sick, but promoters rarely do!”

Gaurav's Blog


August 2011

iPod…iPhone…iPad…iResign!….Apple iCon Steve Jobs

iPod…iPhone…iPad…iResign!….Apple iCon Steve Jobs

Finally Steve Jobs has called it a day as CEO at Apple as he is unable to cope with his duties…he will be Chairman though

Loved his 2005 address to Stanford Students…have posted it on a page on my Blog…am repeated it below…do read it 

Steve Job’s June 2005 Address to Stanford Students

Wednesday, September 10th, 2008

My Take on Anna Hazare….”I’m Anna”

If it were not for Anna,India would not have rallied together in strength to combat Corruption and demand a more impactful Lokpal Bill to make simply every Indian accountable

Ten Days into his Fast now and what is the sole and continuing argument of the Parliamentarians !?…that the Parliament is Supreme and Anna Movement is subverting the Parliamentary Process !….May I ask then how many  Processes have been subverted by the Parliamentarians in unholy nexus with Bureacrats,Industrialists and even the Mafia and even overseas forces to amass ill gotten wealth !?

Yes,The Parliament is Supreme as an Institution…but not this lot of self serving Parliamentarians !…so in a Democracy we can only vote them out through Elections that are held every Five years…but what if even our Election Process can be subverted and Manipulated by Money Power,Rigging,Caste Vote Politics,Booth Capturing,Mafia Fear…how do we cleanse our Parliament of any Virus !?…our Democracy is at stake…will remain on just paper 

It is abundantly clear that these Parliamentarians see themselves as being a law above the law !…as Times of India headlined today 542 VIPs are  making a fool of 120 crore people….  and the ‘I’ would stand for ‘Insensitive’,though I daresay many would have a more stronger and derogatory word for ‘I’….they simply do not want to be made accountable and therefore have placed a diluted Lokpal Bill for debate and discussion where the PM,while he is in Office,the Judiciary and the Lower Bureaucracy are not covered by the Lokpal and even the citizen cannot taken action against any MP unless the Speaker allows it…The Lokpal Committee too will be dominated by Judiciary and Lok Ayuktas will have truncated powers at State Levels…one Parliamentarian from the Congress, Narayana Swamy had the gall to state on a popular TV News Channel that who is Civil Society to decide…and that Parliament is Supreme !….God help us if we have such rigid and prejudiced and arrogant and condescending MPs  

When Corruption seeps in to Holy Democratic Institutions,the Democracy becomes an Autocracy by a Few as the System  begins to corrode despite the checks and balances in place…all begin to get corrupted….shamelessness and thick skin develops over the years….!….From ‘Parliament and Judiciary is Supreme’ it becomes ‘I am Supreme’    read more

Easy to be a cynic when deprived of sleep !…had predicted last year Sensex will drop to 16000…Now What ?…Should I become positive again and predict higher levels from here !?

My Wife and I’ve been up till past midnight till early dawn most nights these past few months…before your mind conjures heavenly thoughts on what keeps us awake,let me quickly deflate any such conjectures !….it’s completely work related

And it’s easy being a Cynic when deprived of sleep…so do pardon me here

Saw and Heard our Cricket Captain Dhoni last night after we,the Test Cricket Champions, were thrashed 4-0 in the Test Series in England…..”We did our best” claims Dhoni….Really !….wonder what would have been our worst !…is there something in Test Cricket losing by Two Innings !…and yesterday was Day 5 of the last Test match and we were quite comfortable at Lunch at 200 odd for 3 ,having scored 87 runs in the morning session in 30 overs without losing a wicket….still adrift by 60 odd runs to make England bat again….Then what happen post lunch that we lost seven wickets and lost by an Innings and 8 runs !…..I’m truly Fixed….was this Fixed ?         

Slept at 2 pm,got up at 5 am as an outstation guest was leaving….dropped off daughter and her friends for football at 6 am…saw a Standard Chartered Bank Ad on the Bus Stop at Marine Drive ‘We are here for Progress…We are here for Good’…Whose Progress !…and is there any doubt on being here for Good that you have to assert it !….Inside Voice yelled at me ” Don’t be such a Cynic !”

And to top it ,Wife thought I was being a Tuesday Cynic…..She wondered what must I have seen in her if I am such a Cynic !….”Less Flaws than other Women !” I innocently remarked……That did it !….”You’re an MCP!” she asserted….I have decided to return to being the Positive Person I am and take this to mean  as ‘Most Chivalrous and Courageous Person’….and in line with this I think I should positively predict a Higher Sensex from the current 16000 levels….Should I ?

Cheers !    

Your Equity Approach & Strategy will or should depend on whether you want to make money or don’t want to lose any !…NHPC or NTPC ?…or Delta?….New Listing L & T Finance is a safe bet for both objectives

Your Equity Approach & Strategy will or should depend on whether you want to make money or don’t want to lose any !

So if you are a guy who sweats at falls you ought to be taking less risk and looking at the ‘N’o or Low risk ‘N’s…NHPC @ Rs 25 and NTPC @ Rs 175 

But if you enjoy or indulge in Equities hoping for the windfalls,then perhaps you should chase Delta @ Rs 98…Rakesh Jhunjhunwala increased his stake today in this Jaidev Mody company

However what may interest both set of Investors..those not willing to risk capital or those willing to aggressively risk it…. is L & T Finance Holdings that listed today……Issued at Rs 52,it listed around this price,went up marginally and then slacked to below Rs 50…bounced back up to Rs 51 and then again dropped to close below Rs 50

This is Larsen Groups first Public Offer in nearly 25 years and that too a share with FV of Rs 10 offered at Rs 52 and available below Rs 50 on first day of listing !…..It’s and operation of scale and spreads…. and L & T Finance comes out a winner in both…my valuations for it are strong over One to Three Years….It must be in any and every Investment Portfolio    

Cheers !

Piramal Healthcare invests US $ 640 million for a 5.5% stake in Vodaphone Essar….looks suspiciously like a ready forward deal as Ajay Piramal explains the Exit Options !…whatever…. limited downside from CMP of Rs 380

Piramal Healthcare invests US $ 640 million for a 5.5% stake in Vodaphone Essar….looks suspiciously like a  ready forward deal as Ajay Piramal explains the Exit Options !

Stock Channels carried ‘live’ this afternoon Ajay Piramal’s Media Meet to announce the rationale of the above investment

Interesting Comments made by Ajay Piramal…..however he refused to answer directly a question posed to him whether the exit options have been documented with Vodaphone….in a subsequent interview when posed the same question he replied that the confidence comes from the discussions he has had !

Ofcourse they would be confident !…it would have been captured in a Shareholders Agreement

So what is this new Investment and the rationale given

Well,Piramal Healthcare is sitting on Rs 10000 crs cash and receivables …..This surplus was a result of selling out in 2010 their domestic generic formulations business to Abbott for Rs 17000 crs or US $ 3.8 billion !…at nine times sales and 30 times EBIDTA !…transferring as of September 8,201,the Baddi Plant Assets and 5000 employees and 350 brands to Abbott…Rs 10000 crs were received upfront while Rs 1750 crs will come in four annual tranches  

The monies received/receivable are @ Rs 17000 crs….tax was Rs @ Rs 3700 crs..Rs 2508 crs was used to buy back 20% of the equity => 4.18 crs at Rs 600/share…Apart from a normal dividend of 300% or Rs 6/share a special dividend of a similar amount was announced 

Ajay Piramal boasted today  that the rime objective was to increase shareholder wealth !…and  that he has distributed Rs 2700 crs to shareholders !….really !…How ?…actually the routine Dividend is Rs 6 per share => @ Rs 100 crs…a special dividend was announced of Rs 6 per share too….that’s another Rs 100 crs….so dividend was an aggregate of Rs 200 crs….and Rs 2508 crs of company monies were used to buy back shares as stated above…at Rs 600 per share !…this reduced the paid up equity capital base from Rs 41.80 crs to Rs 33.44 crs as at June 30,2011….now buyback is normally a strategy that should be EPS accretive to remaining shareholders  and is deployment of surplus company funds that cannot be reinvested or applied elsewhere to earn good returns !……what has happened is that the scrip price has drifted down below Rs 400 from above Rs 500….the buy back of 20% of the shares was not a good strategy at the high price of Rs 600 …..remaining shareholders have suffered badly… has lost Rs 2508 crs for this buyback with nothing to show for it !  read more

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