Is there a official announcement of cancelation of buback of sshares because i could not fins anything on BSE announcements.
It was published in ET
Please read the company presentation released and check page no 18 point no 6. You can almost conclude that buyback will be cancelled for sure, maybe there will be little bit of dividend. However that is also doubtful. Now they are telling that- they will not produce the number but work for the number- Joke of the day, but anybody is trapped believe the management and pray to God that someday those numbers will come in reality.
Follow the tagline " jago grahak jago" this is new tagline of sebi. If you will look and analyse the whole situation it’s a farce and slap in the face of investor-
- Ex sebi director is on the board of director.
- Vakrangee was included in nifety quality 50 index or so.
- News channel anchor who are becoming sage postfacto- Most of them are fooling people. After each quarterly result these channel use to invite Nandwana. Not only this cnbc has done 30 min special programe on- why vakrangee is performing so well. Analyst named Dharmesh Kant has predicted that it can double from valuation of 37000 mcap. I was sitting on profit of 2.8 lakh in 6 month but I was waiting for long term capital gain and hearing these intelligent people advice- I did not sell at 515 inspite of knowing that something is wrong. I came out partially in rally around 240 and left share of 50k (punting).
- All big names in shareholder.
- Check the number of buy reports issued by institutions. All are posted on Vakrangee website. This shows the abilty of self proclaimed expert- you should understand that this is also a big fraud going on- For eg- MOSL, Eqity intelligence, kotak, Basant Maheswari, or any investor with lot of fan following use to purchase 100000 share of company x and crowd use to chase; that person use to sell 50000 share at double price in 3 month. Hardly anything use to chage in company in 3 month. But now that person capital is free. That why it is said- Bull make money; bear makes money but hog get slautered.
- Now one new pandit is on rampage- respecting forum policy I will not do personal attack but hope pepole can make out. This is why RJ use to tell that tips are injurious to health and wealth, but these people use to claim to make us RJ. In market there are very few honest people and most of them don’t run twitter account.
In last all people who got cheated should remember RJ words of wisdom:
- We have done a mistake in analysing and recognising a person and not market.
- No regret; only learning.
- Make a mistake so that you can live to make other.
I am having a suggestion : why our senior member should not start a thread in which only quality of promoter and management of any company should be discussed and not numbers and ratios? Because it use to become really difficult for a new person to search these informations in between so many comments.
Good write up and I also experienced the same on these so called experts.
Your suggestion on management quality, integrity etc is good but it would remain an individual perception and gaps will again be disastrous for the writer especially for small and mid cap companies.Therefore it could be a mix of financial performance and management, but own due diligence will still have to be done
Members of any forum have diverse intentions. Some would prefer to push the price up for them to benefit. The data was in public domain and it is individual’s responsibility to check facts discussed on the forum.
In my opinion, discussing management quality isn’t a value additive proposition. Our evaluation is often fraught with our biases. When share price is appreciating people wax lyrical about management quality. When there’s a meltdown management is criticised. There aren’t many methods in which we can objectively evaluate the top leadership. And, even when there were tell tale signs of something dishonest brewing, investors were blinded by the stratospheric targets provided by institutions. At the end of the day, its important that we shed entitlement. No one in the market owes us anything at all. As you’ve rightly mentioned, we’re enveloped by manipulation. We’ll have to adopt the policy of distrusting before trusting.
I am not suggesting that we should not do our due diligence or not look for the company’s financial performance.
What I am trying to hint is that it will be good to analyse the quality of management within a year of investment. I agree with you that it’s having lot of subjectivity involved, but inspite of that we can get benefited from views of our forum member where lot of seasoned investors are there.
Now also we use to discuss these things while discussing on any particular company, but it use to get lost in so many post. It’s like SWOT analysis of promoter and management. Now also anyway, we use to do SWOT analysis of company, but according to me if some comapny is failing in quality of management and promoter, people should atleast know that risk in advance. So, that they can regulate their bet size.
Observe people around you (friends and relative over past 20 years or even more)- people’s wealth and numbers change but habits (Honesty, trustworthiness, keeping your words inspite of difficulty, thinking- like your friend has helped because you was clever equivalent to promoter thinking that minority investors are partner or bakra, etc) don’t use to change much over time (Yes agree few exceptions will be there, but exception does not makes the rule.) In hindi one old adage is there- “CHOR CHORI SE JAYE; PAR HERAPHERI SE NAHI.”
It is very tedious and cumbersome job which can’t be done by few people, but hope we can do it together, if we do it in structured manner like I will try to put down some point which everybody knows that they should do- but does time and energy and lack of information permits?
- History check of management- Age, education, previous venture, relation with people around them.
- How much they value their words.
- Does they understand the difference between conditional statement and statements to creat sharemarket stir.
- They are focused on increasing the value for all stakeholders or for themselves.
- Does they try to siphon money via different mode. Even increasing the expense can be one- this is difference between Waren Buffet and our Tata, Birla or Reliance.
- How management use to allocate capital.
- If it is a family run bussiness, does leader treat minority shareholder equal to family member.
- Cultural and ethical values- check emami ( not recommendation or invested) and compare with 90% of gujrat based companies (no offense but that culture that atte mae namak jitna jhoot to chalta hae.) I am not discussing which is good and which is bad, but just trying to tell that we should know management belief system.
- Focus and aspiration of management and reality check once in year or two. Vijay Kedia is good person to learn- SMILE.
- Gossips about behaviour of management- I think most of you will agree that what our friends and relatives use to say in our absence use to define our character more accuretly- yes with definite caveat that their assesment can be wrong, but with good sample size chances are less.
- Checking the conflict of interest of management. Eg. Supplying some raw material at higher cost through their pvt company to a listed company.
- Why and how management is diluting or even increasing.
- Management is profit driven or not- but we should keep a watch if they are too much profit driven. Both extreme can be bad.
- To track management commentry and change in that and timing of informing the shareholders.
- If promoter’s relative or promoter himself is employee of company then is salary inline. Eg. A company named SRS - it was a loss making, but both broters were taking handsome salary. Promoter and director were same.
- How many time company has tried to hide bad news in fear of share price fall- Be wary of this kind of management.
- Character and tenacity of management- little bit can be known how they have handled adversity in their past. I would have given eg but it will become too long- read about promoter of Delta corp or most of the RJ’s investment not trading bets.
- Last but not the least- Long term behaviour of management- eg. Divis’ management- only responsible to its shareholder and not to media. Does management come out when situation is bad or rosy or in both equally or never.
I think your real intent here is - How do we put in place a framework to ensure that we do not get trapped in stories where the web of lies spread by promoter/management/media/analyst are not very apparent at first look? Not necessarily how do we evaluate management and promoters
I’ve been thinking about this since 2015 and have the following things in place to minimize the chances of getting caught in such stories -
Invest only in those companies that have been listed for 10 years and more. Any promoter who lists to pull a quick one is unlikely to wait for 10 years to do so. Let time work in your favour
Invest in stories where I can use multiple sources of information/data to triangulate the numbers being put forward by the management. I hence have a preference for brick and mortar businesses where it is relatively difficult to pull off accounting tomfoolery, once can always check what prices of raw material is, what the actual product sells at in the market and see if the margins and profits are possible
Never get taken in by management talk and aspirations of what they will do. Evaluate managements based on what they have done. Talk is cheap, actions and history speak louder than anything else
Stay away from stories where the management talks about a radically new business model that no one else is pursuing. This can be possible in information based industries but rarely in brick and mortar businesses. Whenever the rest of the competition is doing things the usual way and one company claims to do things differently - most of the time this is a red flag. Not many things in the world are unique, what one can do others can copy if that approach is indeed better. Case in point Treehouse owning all their centers while everyone else is running a franchise model. Easy way to siphon off money from the balance sheet in the form of ghost capex
Always triangulate market share data from independent sources like annual reports of competitors, industry reports and aggregates. If one had done this, he would have never gotten caught up in Manpasand beverages
Always read annual reports with a storyline approach. In my analysis model I have a separate sheet called annual report and conf calls messaging where I note down what management has been saying and doing over the past 10 years. The best stories are usually the most consistent and manage to get most of what they say done. If one gets too caught up in the details, one will miss a very important indicator like this one
Always see accelerated capital raising as a red flag. Look for innocuous statements like “board has approved raising debt limits to 1000 Cr from current level of 500 Cr”. This is usually a precursor to booking phantom revenue, blocking the money in receivables, increasing investment in WC and finally writing off a chunk of this as unrecoverable. Study the Edserv story for how this played out
Always ask yourself - “if I were the promoter of this company and wanted to siphon funds off, what would be the easiest way of doing this?”. Answer is usually found in balance sheet changes that the cash flows do not seem to match. Look for resonance across all three financial statements. For e.g. If capital raising is done and invested into fixed assets which are not really producing much, look deeper. If capital raising is done and most of it is going to receivables, look deeper (Shilpi Cables)
Any company that does too much corporate action might be looking to confuse and overload people with too much information. I have serious reservations on what Talwalkars is doing
Any business action that is inconsistent with common sense - Satyam acquiring Maytas in 2008. For this very reason I have reservations on Talwalkars buying a gym chain in Sri Lanka while India remains a largely untapped market. I am by no means coming to any conclusion on the company or the management but all I am saying is something doesn’t sound right to me and I am willing to pass for this very reason
Always looks for resonance, this you can do only if you have the ability to extract yourself from the overload of information and see things from a 20,000 ft level
Long story short, it is rarely about management quality. You can have high quality and highly educated managers pulling the worst of frauds.
Instead focus on patterns and try to hypothesize what they could imply
Build your own framework and add to it as you read and learn more
Have the humility to accept that you can still make mistakes after doing all this work
If i am not mistaken ,vakrangee has been around for 25 plus years.
MARKET MASTERS WITH SHANKAR SHARMA (PART 1)
Good neutral interview!
Please now don’t chase smallcap optical fibre company. Is it Aksh he is refering?
Brokerages who were recommending to avoid Vakrangee like plague couple of weeks back have started recommending it after a 50% rise in stock price. https://www.goodreturns.in/news/2018/06/19/stocks-under-rs-50-which-remain-high-risk-high-rewards-bets-723384.html
Apparently, the rise in price washes away lots of sins just like drastic fall in price raises many questions about corporate governance and management quality which no one thought of when the price was rising.
Strange times, indeed…
Which brokerage? The link is not a brokerage website!
I myself have written several messages in this thread doing lot of analysis as how Vakrangee books look cooked. Further at end of May , I posted message that I think lot of bad news is already priced in and there are some positives.
Since then the stock has stablized and done several upper circuit. I think analysts can have different views at different times, they can be even conflicting views. People learning need to have an open mind and keep their emotions out. Take some aptitude test using apps to check if your brain work rationally, if not then fry it more.
Time horizon of investment play important role, for many people 1-3 yrs is long term and for some its 10-30 years. Most young people even after loving warren buffet think about what best they can do to improve their returns quickly, surely they don’t want to wait till 60 yrs to get rich.
They think about how to use knowledge on internet to accelerate their portfolio. They dream if they can get one multi-bagger on steroids … and this is where the game begins… one day they hear a story that looks matching their dream and they are sold before they read further. After that they start doing analysis and their heart plays the ball… and mind only read what looks to satisfy their dream… they cannot accept anything that can break their heart.
This is why, when Amit Mantri … wrote about vakrangee fraud in his blog in 2015-16 and even a message in this thread most did not gave it due importance … He pointed out almost all of the issues in 2015 itself with lot of clarity.
Hence having a spreadsheet and long check list with ratings on management quality is not important but it’s very important to keep your emotions out, be rational and give due importance to all messages … You will be better off.
People try to paint in black and white, but problem here is that black and white can give various colour combination depending upon what colour new light of fact will fall over.
That is very true that in market, we should control our behaviour and not fight with market. You should have your thought process and have guts to question anybody or any guru. If you are not having your logic then you are in trouble. Build your conviction before investing and keep on changing as new facts emerges.
I have targeted Amitjee not because he has done something wrong, but because people were again doing same mistake by blindly following him what they have done by ignoring his red signals in 2015. It is a classical falacy- a person who use to fight and argue that God does not exist is creating same mistake as one who is fighting that God does exist- however both are not having any evidence to prove their point. It is only about your belief system and what works good for you. But, we as a religious people paint the person as demon who use to tell that God does not exist.
I will give you my example to prove that- “why you should have your thought process developed before investing and not follow gurus and trend?”
Listen and learn from everybody but take responsibility of your action and have healthy degree of skepticism. Don’t get happy with CONFIRMATION BIAS but have guts to face the consequences. Atleast if you will fail- you will learn someting new, but if you will follow the crowd, you will only learn to blame other for your failure.
Now, come to my case-
I have invested 1.8 lakhs in Vakrangee seeing its great return ratios, high growth, and simple scalable bussiness model (didn’t read Amit’s write up on Vakrangee; else maybe I would have not invested at P/E ratios of around 32 or more). But few drawbacks what I was knowing before investing are-
- Its promoter were having some charges of insider trading during 2011 or so and stock was dusted. So, I thought management had learned their lessons and mended their ways.
- It was earlier working and taking projects from government department, so he can’t be clean- taking bribe and giving commision that is part and parcel, but on the positive side this also shows their execution capability and some short of real bussiness does exist( let me accept that I have failed to colate their earnings and profit number as Amit did.)
So, After purchasing when it has moved in 1 months only to 400, I have sold around shares of 50k. And then left remaing shares of around 1.5 Lakhs for long term. Then in next 6 months, it has moved to 515. Knowing its history I was very suspicious of its move. I have talked to my friend and decided to sell half of my shares. However, it came down to 505 upsetting my plain vanilla calculation. So, I have waited to again go back to same level and meanwhile listen all analyst and bussiness channel. All were singing in same tune. But, after 4-5 days lower circuit and news broke out. It did not give me any chance to come out till 180, which was close to my purchase price. So, I have sold my share of around one lakhs at 240 (Accepted that management has not learned its lesson and they think that they are very smart).
And just kept shares of 50k for long term. Now, my capital was almost saved. But, then it has again turned from 280 and gone down to somewhere below 35. Now there was nothing to loose at this price, so I have purchased 1000 shares again and luckly from that time it has gone to 50. I know it can again go back but I have taken this risk because almost all negatives were priced in at this price.
So, few lessons that I have learned:
Don’t look for confirmation of others when something is not logically justified. A company like Lupin making 3000 profit available at market cap of 35000 cr and Vakrangee at 45000 cr or more.
Don’t follow somebody and leave something on moral grounds, when it is available almost free of cost.
When you are listening to anybody, try to think logically that what he is doing- postfacto rationalization or he is really knowing the future? Check who all have prescribed Vakrangee, even our fundamental analyst like S P Tulsian and DD Sharma and 1000 more.
I think I was most unlukiest person in the history of Indian stock market😜 Can you imagine just 8 shares I am having in my portfolio, but two of them are Vakrangee and Manpasand.
I am not telling that you should go for something when you are convinced about wrong, but don’t listen too much of postfacto rationalization also. Logic is very easy to tell but very difficult to practice. As written in THINKING FAST AND THINKING SLOW our mind need to leap the logic for our survival.
Someday I will tell you my Manpasand story, if you people will not abuse me for writing my experience.
I don’t use to read too many number before investing, but trying to improve by reading you people’s number analysis.
In short, about Vakrangee(1) and Manpasand(2), Latest Holdings Status
(1) Retail investors more than doubled their stake in Vakrangee to 10.55 per cent at the end of June quarter from 4.63 per cent and 4.16 per cent at the end of March and December quarters, respectively.
Foreign portfolio investors (FPI) also reduced stake in Vakrangee to 20.55 per cent from 29.12 per cent at the end of March.
Mutual funds held just 42,051 shares of Vakrangee as of June 30 against nearly 5 lakh at the end of December quarter.
(2) Retail investors’ with share capital of up to Rs 2 lakh hiked their stake to 6.19 per cent during the quarter gone by from 2.49 per cent at the end of previous quarter.
Foreign portfolio investors reduced their holding to 13.35 per cent from 21.56 per cent.
Mutual funds reduced their holdings to 10.83 per cent from 11.60 per cent at the end of previous quarter.
To summarize, for Vakrangee, FPIs reduced stake by 30%, and MFs reduced stake by 90%. Retail absorbed these stakes. MF reduction is quite drastic, but given approx 90% reduction in price, maybe justifiable/in line. Large divergence in reaction of FPIs vs MFs. FPIs seem more relaxed, or at least more patient rather than panic selling.
Disclosure: 2% stake in portfolio @ average price of 60, since 2 months.
calculations indicate an open offer price of Rs 174 per share
Q1 results and Dividend decision Today.
If it happens , how many shares of total shares approx will be bought back ? any idea ?
This is about getting a controlling stake (of 51%) i.e… a buyout.
As explained by article:
This, SEBI noted, exceeded the 25 percent shareholding threshold in its Takeover Regulations, and hence a mandatory 26 percent open offer to public shareholders had been triggered.