All turnarounds are different.
V Vaidyanathan for IDFC bank (I am invested and biased).
Motherson Sumi for the subsidiaries they are acquiring (they are famous for acquiring loss making foreign cos at the behest of their clients and turning them around)
gIven the amount of muck they were in, I think the yes bank turnaround is decentish under Prashant Kumar who joined from SBI.
IDFC First has been turning around since 4 years or so (2018, 2019, 2020, 2021). yes bank, 2 years already and probably 2 more to go. Turnarounds are painful and slow, even when successful.
then there are also investors who want to acquire controlling stakes in assets having questionable quality at lower than fair value (deep value investing). Howard marks is one very famous investor who does some of this.
Disc: Invested in IDFC First, sold yes bank 2 years ago. This is not buy or sell reco.
What happens to stock price, when there is no buyer for a stock. Will it go down? If price has to go up every day throught the year, should the stock be bought by others? We are in 2021 and prices are moving up every day. When people run out of money and not able to buy no more share, will it cause a fall.
Let us say, Company A has 10 shares and promoter holds 5(50%). other 5 shares are held by 5 different people, each holds one share. Current share price is Rs 1. When all these 5 people want to sell but there is no buyer. Becuse nobody has money to buy it. Will it go below Rs 1. But the company is make profit of Rs 2 every year.
Can you explain different scenario with respect to promoter holding and number of players in an industry?
Sometimes, promoter holds 75% and due to lack of available share for trade, price shoots up. But later promoter dilutes and share falls.
Sometimes, you have one company which is enjoying monoply status and it commands premium. But as soon as new company comes in and it breaks monoply and stock falls like anything.
When there are no buyers, the price remains the same as there is no trading, no shares were exchanged.
People will never run out of money, because when we say a country, we mean all the people in the country but when we say people in the context of stock market, they are not one single group, they belong to many groups. Value investors wait even for years to buy, and deep value investors buy only when what you have said happens, they buy when the prices are falling down rapidly, they buy when they have a huge margin of safety and they are buy are buying lower than the intrinsic value. All kinds of people make the market, from the very perspective to the capital, there are many groups. All of them don’t buy at the same time, because they are fundamentally different, poles apart.
I don’t have the experience of a bear market, so I cannot comment on what happens in a highly traded stock like ITC or HDFC Bank or TCS for months. Of course, as these are high liquid stocks, intraday trading happens irrespective of the market but the price may not move anywhere at the end of the day but the delivery will be low.
There is the opposite too, the pump and dump. Price is pumped up by operators and when gullible investor buy at the highs, the stock is dumped and the investors are stuck with no buyers.
Last year if my memory serves me right, there were no bids for Divis, zero, there were transactions happening but no visible bids. So yes, it could happen to the best of the companies.
I watched monish pabrai video and he told that when he started to buy rain, the price shoot up. But once he is done, the price fall back to lower. So when buying stops the share to fall.
Why is so many companies not showing shareholding pattern, List of Shareholders holding more than 1% etc. in the Annual Report 2021? Is the rule changed?
I was looking in to Biocon and i observed that they are showing Syngene revenue in consolidated statement. But they are showing 100% of Syngene revenue in their statement. Is it correct when they hold only 70% of Syngene?? Is it a common accounting practice to show 100% of subsidiary revenue irrespective of the shareholding %?
Valid point, from a business point of view it does not seem right to use the full numbers in their presentation, annual report etc. though I don’t know if the accounting standards mandate it this way.
For investors, they should not look at consolidated numbers for companies like Biocon. Syngene has its own business, own board and its own set of shareholders. The parent does not have 100% control over subsidiary cash flows and cannot simply pull out the cash and use it for its own business. The right way to look at Biocon would be to value it ex-Syngene and attach a separate value for the Syngene stake. Consolidation is just arithmetical addition of the line numbers and when the subsidiary is a widely held independent company, consolidated numbers do not indicate much.
“HDFC Bank writes off Rs. 3,100 cr NPA in Q1”
I read this in today’s business standard news paper.
But I want to know where and in documents companies mention such writes off?
Do they mentioned such in quarterly results or In annual report.
I think it should be in annual report, if yes then in which section?
Off late I have been seein a lot of asian paints products in hardware stores. I got to know two days after I used a sandpaper that it was asian paints sandpaper! Surprised they are not even leaving sandpaper to local companies. So i started looking at their reports if they mention it. Thankfully they have a separate segment for home improvement in their earnings reports. The following is taken from screener. I went through their annual reports. yet to read/attend concal.
Does following number indicate they continue to deploy money but offlate the loss has been reducing and corollary to that is sales picking up?
Hi @barathmukhi
My question was only about inferring what is going on. Now about its impact in their overall revenue. Can I infer the following? Or there are other parameters to consider?
Does following number indicate they continue to deploy money but of late the loss has been reducing and corollary to that is sales picking up?
What are the various reasons when cash flow from operations will be lower than profit after tax. One reason seems to be increase in either trade receivables, inventory. Similarly, what can be other reasons.
May be, these investments are proposed and initiated by the MF teams of their respective banks to whom the companies are clients. The redemption time if need be, could be quick as compared to direct funds, so the companies do not mind paying a little more TER compared to the services they are provided as corporate clients.
Changes in receivables, payables, inventories minus
Non operating income such as interest income.
Hence, I would presume that the other items that could lead to lower cash flows, based on this definition could be,
Advance taxes paid
Decrease in payables
Losses from transactions outside the company’s core operating business and interest paid for such transactions, etc. (Some cos also put this item under cash flow from financing/investing)
