The Sep-18 meetup held after a long time saw a turnout of ~100%, which is either a testimony to a bull market, or to the curation of the audience. Either ways, this was unprecedented. The turnout of 45 included attendance from Pune and Surat too. The agenda discussed was as follows
@amey153 discussed his analysis of Kitex Industries, and updated for recent observations from the annual report, and tried to cull out lessons learnt. Interesting points were triangulating private company performance with its listed peer, mean reversion, related party revenue routing and the risk of high customer concentration
@Yogesh_s discussed lessons learnt from his investment journey, with errors of omission and of commission. The tale of Apple explained the risk of sizing TAM(Total Addressable Market), as also how investment approach evolve over time such as paying up for B2C stocks, keeping macro checks etc
@jprasun discussed his investment thesis on CDSL, a seemingly simple play, but also explained on how to split its revenue streams into regulated annuity based/market linked unregulated etc. He presented the audience a case study on valuing it when estimates ranged between 20x-30x core earnings, which was not too far from reality. Discussions also went into the divergance from CFO to PAT due to an accounting rule
@kashish24 explained his investment thesis on a SME player Sirca Paints(Disclosure: They have business with the company), which is a niche PU based B2B paints trader(it imports and resells), which is now pivoting to a manufacturing operation and eventual branded play. Many having analyzed the stock, discussions led around entry barriers, competition from Pidilite/Asian Paints, affordability, realism of Nepal/Sri Lanka plans, GST excuse for receivables decline, and the need for volume data to make inferences on pricing power etc.
@mythace discussed the investment thesis of GMDC, a lignite manufacturer who is seeing good times due to the coal prices hike. Interesting points like renewable energy play, reserves replacement limit to valuation, customer coal allocation due to PSU policy, market response despite operational improvements etc was discussed.
@paresh.sarjani1 discussed Shiv Keshav Cements. Key questions emerged around the ability of such a small company to fund 20MW solar plant along with the other capex, as also whether a small commodity player could survive and scaleup. Other themes were also on interest expense numbers(why lower)
I have also attached a PPT ‘Ground Rules’ to help first time prospective attendees better understand. Do ping me 1:1 if any queries. As always, the PPTs are shared subject to the usual disclaimer that any investment activity is at your own risk.
Investment Lessons.pdf (320.1 KB)
Investment Gone Wrong - Kitex Garments (1).pdf (2.7 MB)
Ground Rules.pdf (424.3 KB)
CDSL.pdf (680.0 KB)
Sirca Paints Presentation.pptx (491.6 KB)
SKCIL (1).pptx (682.0 KB)
GMDC VP SEP 2018_FV.pdf (1.8 MB)