Hi - I would be happy to work on Tasty Bites (I have reached out to Anant Jain on this - since he has got the ball rolling already) or Hester Bio - with anyone interested in these businesses.
Tasty Bite I have a fair understanding of, having studied it in the past. Hester however, would be a fresh start - but I am willing to pull my weight. If anyone is looking to work on these companies, do let me know.
Thanks
Akshay.
| Business | Primary | Collaborator |
|---|---|---|
| Eicher | Raja Panda | |
| AIA Engineering | Raja Panda | Punit, Donald |
| Kaveri Seed | Amit Aggarwal | Donald |
| Kesar terminals | Shiv Kumar | |
| CCL Products | Anindya Bhattacharya | Anuranjan, Donald |
| TD Power | Kiran Dhanwada | Omprakash |
| Shriram City | Ishan Gupta | DeepInsight, Donald |
| PI Industries | Ananth Shenoy | Donald |
| ENIL | Dhwanil Desai | |
| Tasty Bites | Anant Jain | Akshay |
| (to choose) | Varadrajan Raghunathan | |
| (to choose) | Abhishek Basumallick |
Hi Donald,
Itâs a great collaboration exercise. I know I did volunteer few weeks back however I could not take it forward due to some other commitments. It was my bad.
I am now determined to work on the template for Kaveri Seed. I will contact you offline once I complete the first draft.
Thanks
Amit
Hi Donald,
Thats a great move to make the list public,no escape now :).Glad that you did it.Over the last 9-10 months I was reading analysis/comments/blogs from experts like you,dhwanil,abhisek,Raj and all others and thinking how to get such clarity in thought process,now I can also try to apply whatever i have learnt.
Anuranjan,
I have started working on CCL this week and I will drop you a mail through VP and discuss how to take this forward.
Thanks,
Anindya
Hi,
I am uploading the BQ Analysis on Tasty Bites created by Anant with assistance from me and a lot of guidance from Donald.
Look forward to everyoneâs thoughts on this business.
Akshay
Tasty Bites - BQ V(1).xlsx (17.7 KB)
Hi Dhwanil,
I too have a position in ENIL and am deeply interested in the company. I have not done any collaboration before on any company and am bit of a novice when it comes to analyzing companies. However do let me know if I can help out in any way possible.
Regards,
Nelson
Tasty Bites
This is the link I found quite nice.
mental model on tasty bites
@mg108, Guys, this is not the tasty bite thread. Please refrain from cluttering this thread and if needed create a diff. thread for tasty bite.
If you want to upload the BQ template of any business then itâs ok to use this thread, i guess.
Hi,
I am a newbie on VP. I went through the presentation for Business Quality. It is very informative and I learnt some valuable and insightful lessons. Thanks to Donald and team for putting it together. Also appreciate the discussions about the same in the forum.
I had one doubt though. I saw in the case studies mentioned in the presentation about stable PE range for every company and a comment if the valuation has run ahead of the fundamentals or not?
I understand broadly that the variables which determine PE are the type of industry, growth prospects etc. Also I read Prof Sanjay Bakshiâs presentation about using DCF as a rough guide to demonstrate the fact that high PE does not necessarily mean expensive (for high quality businesses) and how market still underestimates the future prospects of a high quality company. But I am still not clear how to judge what is the stable PE for a company.
I would like to learn about the methodology you folks used to arrive at a stable PE range for the companies mentioned in the case studies. Thanks a ton in advance.
This is a very involved topic. And as Hitesh is fond of saying âBeauty lies in the eyes of the Beholderâ there is a wide range of answers that you get from people. For a proper perspective on Valuation, there is no better thread at ValuePickr than the ART of Valuation thread - where we have captured our Learning over last 5 years - thatâs one of our most appreciated threads.
Everyone is encouraged to read that thread, and if you gain a new perspective from any of the posts, donât forget to use the Like button. Thatâs the only way the community gets to know - what most folks find most useful for their needs.
Meanwhile, just to get you curious, will share the essence - the gist of what we think is at the heart of the subject - what are the attributes that drive valuations for a business ( In Mr Marketâs eyes). When we talk about a stable PE Range - we are talking about Mr Market differentiating one business over the other (over the longer term) on some key Metrics
If you read the ART of Valuation thread with care, you will see how we were prompted to check out business from different sectors - why a Pharma company gets even 9x Sales valuations (IP? ), and why a commodity chemicals company cant get more than 1.5x Sales (Cyclicality?). We found that a very useful construct in thinking about Business Value Drivers, and Valuations. Everyone must read the Copeland Book on Valuations.
The other thing we all need to appreciate is the role Intangibles play in Valuations - and how we can get better at quantifying the Intangibles - Strategic Assets, Business Architecture (The Porter completive forces model). The importance of thinking like a 100% acquirer of the business with a choice can not be over-emphasised (if you had the money and had to choose between buying out entirely - Astral over Mayur, or Ajanta over both). It helps us dissect Valuation from an entirely different perspective - overlooking the numerical valuation metrics and ratios for cashflows, price to book, or earnings.
Turning through a lot of practical examples we have witnessed in last 5 years, and active brainstorming at VP and with senior investors and gurus, we progressively defined the current VP view on Business Valuations as below.
This is obviously work-in-progress, we reserve the right to refine these based on more practical learning, as we gain more experience in Markets.
Donât forget Valuation is ART. We need to develop and use the right side of the brain a lot (skilfully moving a little away from the left side of the brain - predominantly numbers led - which primarily should serve only to help us avoid mistakes)
@Donald
Iâm just a year into value investing and have been reading up for last year (at my own snailâs pace :)).
Iâve finished Peter Lynchâs âOne Up Wall Streetâ a month ago and have been re-reading as I try to research some ideas.
One thing Lynch says is âBe careful while investing into next somethingâ or âsome miracle future growthâ. He says you can wait for results to show up before you invest as you will still make a lot of money with limited downside.
Now Is there a fine line between âIntangiblesâ and âNext Somethingâ? How do we decide that?
Thanks,
Rupesh
Rupesh,
Why are you equating Intangibles with the next fad. In our markets the next fad could be seen as E-Commerce or M-Commerce space, e.g. Yes, it will be prudent to wait and see the direction things take before making any commitments in that space.
There is a whole treatise laid out on Intangibles in the business at VP - Most businesses that go on to perform consistently have some intangibles built-in. Only our minds are not trained to think that way and go about quantifying them. We have shown how you can think about Strategic Assets and Business Architecture and go on to list them - through our Business Quality presentation - on 6 of VP Portfolio companies.
At the start these ideas may seem pretty abstract - and coming to terms took us a lot of time. The best way to get a grip is to take your favourite business that you know well and research in-depth - try and create the BQ Sheets for your favourite business - struggle with it, take help of other folks invested/tracking and continue refining your thoughts on Business Quality.
The VP Community gives you a platform to showcase your work and enlist other people in your effort to produce something that can be of use to more people. If we found something useful for ourselves, we thought it might be useful for others too - and never hesitated to put forward our honest, if half-baked work on the VP Platform. Thatâs how we have grown and would encourage everyone to do the same without hesitation.
Cheers
Lovely answer Donald. Thanks a ton. I really like the effort and thought which has gone in answering my question. I distinctly see the 2 things in your answer.
The summary has given me nice hooks where I can hang my future learnings. Now I will turn my attention towards your references. I will devote my time to learn more from those references.I will post any further doubts I have once I finish my homework. Thanks again.
@Donald I am putting my neck out. Would like to answer the quiz you left from the BQ template of Avanti Feeds, with the risk of being wrong.
Avanti Feeds is a B+ category stock with great execution but is still open to cyclicality interms of global demand, recovery of Thailand, Cyclones etc⌠The trailing PE of 14 is still below the stable PE range of 15-20.
Would that be right?
Donald,
I have uploaded first version of KRBL BQ sheet in KRBL thread. It can definitely be improved further with the help of other boarders.
I am still to update some numbers and I will do so when screener is up (down currently). I also have left some sections blank where I was not sure.
I request you and other senior members to provide me direction and provide suggestions/feedback to make it better.
Thanks,
Rupesh
Hi Donald
Thank you very much for VP Business Quality Xlsx .
Please share VER 3 Template for the same.
Thank You very much.
Is the Excel available to the rest of us novices as a read only copy?
VP-Business-Quality-Insights.pdf (220.6 KB)
This is the PDF version for your reference. Please Note this was part of our learning in 2015. This needs to be refined further with incremental refinements since then
Excel version
VP-Business-Quality-Insights.xlsx (59.5 KB)
Opens, but seems to have some issues. I have moved systems. Cant locate other versions. Anyways what are important are the placeholders - that we try to fill in for each specific business
Not able to download
Not able to download
