Journey and Portfolio of a goal-based NEEV investor

[goofymanager]

Russell Napier’s 21 lessons offer profound insights into the complexities of economics and investing. By understanding and applying these principles, we can navigate the markets more effectively and make informed decisions that align with our long-term success.

1. Analyze Supply and Demand Equally

When evaluating markets, it’s crucial to spend as much time analyzing supply as you do demand. Focusing solely on one side can lead to skewed conclusions and missed opportunities.

2. GDP and Equity Returns

Contrary to popular belief, GDP growth has no direct relation to future equity returns. Understanding this disconnect can help investors make more informed decisions.

3. Gordon Pepper’s Law

When you encounter something unsustainable, estimate how long it can last, then double that period and subtract a month. This approach helps in managing expectations and risks.

4. The Power of Incentives

Incentives drive behavior. When faced with tough choices, governments will often prioritize controlling exchange rates over other factors. Always consider the underlying incentives in economic policies.

5. Government Market Preferences

Governments support markets as long as they produce favorable outcomes. Recognize that governments are not neutral actors; they have vested interests and take sides.

6. Corporate Profits Mean Reversion

Corporate profits tend to revert to the mean relative to GDP. This strong trend is likely to continue in free societies, providing a reliable indicator for long-term investments.

7. Assessing Monetary Policy

Evaluate monetary policy by looking at both the quantity of money and interest rates. A holistic view provides a clearer picture of economic conditions.

8. The Dangers of Speculation

The most dangerous form of speculation is the reach for yield. Chasing higher returns without considering the risks can lead to significant losses.

9. Populism and Constitutions

Populism poses little threat to countries with strong constitutions. Robust legal frameworks can withstand political fluctuations and safeguard economic stability.

10. Predicting Debt Defaults

A country’s history of debt defaults is the best predictor of future defaults. Past behavior often indicates future risks, providing a critical warning sign for investors.

11. Equity Valuations and Inflation

High equity valuations tend to decrease slowly with inflation but fall rapidly with deflation. Understanding this relationship helps in timing market entries and exits.

12. Emerging Market Equity

Avoid investing in emerging market equity if the country’s exchange rate is overvalued. Overvaluation can lead to sudden corrections and significant financial losses.

13. Tourism as an Indicator

Tourism is a reliable indicator of an overvalued exchange rate. High tourism inflows often signal that a currency is too strong, which can precede a devaluation.

14. CAPE and Equities

Buy equities when the CAPE (Cyclically Adjusted Price-to-Earnings) ratio is below 10, except under certain conditions: if you foresee communism or fascism, potential war destruction, or a new currency regime with an overvalued exchange rate.

15. Democracy and Capital Controls

Democracies are better suited to implementing capital controls than allowing free movement of capital. Political stability and public support can facilitate effective economic policies.

16. Inflation Without Printing

Governments do not need to print money to inflate away debts; they can use citizen savings through financial repression. Thus, hyperinflation is unlikely in the developed world.

17. Technology and Inflation

Despite advancements, technology does not defeat inflation. Technological progress may drive efficiency, but inflationary pressures persist due to various economic factors.

18. Monetary System Failure Cycle

Monetary systems tend to fail about every 30 years. This cyclical nature necessitates preparedness for systemic changes and disruptions.

19. Money Disequilibrium

Money is almost always in disequilibrium. Constant adjustments and imbalances are inherent in monetary systems, requiring vigilant analysis and adaptation.

20. Decimal Point Forecasts

Never trust a forecast with a decimal point. Such precision often masks underlying uncertainties and can be misleading.

21. Extrapolation

Extrapolation is the opiate of the people. Relying on past trends to predict future outcomes can lead to complacency and poor decision-making.

Here’s the video (in case you’re interested in his 60-min talk) https://www.youtube.com/watch?v=S5NA0nS2o-8

Credit: used chatgpt 4o for clarity and easy reading

[goofymanager]

Portfolio update:

Date: 3rd June 2024

Short update: Did nothing. Continuing to buy, hold & track while focusing on portfolio longevity and respecting mean reversion and probability.

However, keeping a close watch on PHANTOM VFX, VBL, NARAYANA and WONDERLA.

Here’s my latest portfolio :

Stock name	Weight	Avg P/E	Total P/L	IRR	Action
MOST 100 ETF	8.9%	19.3	55%	29%
TATA INVEST CORP	7.4%	24.6	246%	148%
BANK BEES ETF	7.2%	12.4	38%	21%
TIPS LIMITED	7.1%	19.3	130%	57%
BAJAJ FINANCE	6.9%	22.2	37%	12%
COAL INDIA	6.8%	4.5	96%	116%
TITAN	6.5%	46.7	93%	23%
IRCTC	6.3%	26.8	251%	56%
CASH	5.5%	-
DIXON	5.5%	42.2	522%	99%
PIDILITE	4.5%	56.5	69%	18%
ASIAN PAINTS	4.1%	46.9	22%	7%
INDIAMART	3.8%	44.7	41%	29%
VARUN BEVERAGES	3.8%	44.2	101%	58%
NARAYANA HEALTH	3.7%	23.5	30%	32%
TATA ELXSI	3.2%	34.2	153%	50%
AMARA RAJA *	3.1%	14.0	77%	111%
IEX	2.9%	14.7	127%	19%
WONDERLA *	1.5%	32.5	-6%	-14%
PHANTOM VFX	1.4%	34.0	-11%	-15%

*(asterisk) signifies <1 yr holding period.

Note: Overall cash position is at its highest as per expectation in 2024.

Here’s the return profile till 31 May 2024:

TRI till 31 May 2024	1M	3M	6M	1Y	3Y	5Y	Since inception
PORTFOLIO	-2.1%	-1.8%	13.8%	35.1%	15.0%	21.9%	20.9%
NIFTY 50	-0.2%	2.1%	11.6%	21.3%	13.0%	14.2%	14.6%
NIFTY 500	0.2%	4.4%	16.8%	33.6%	17.4%	17.3%	15.9%

Note: 1/3/6M is in absolutes while the 1/3/5Y/SI is annualized. The inception date is 10th Nov 2016.

Disclaimer: I am neither a financial nor a SEBI registered advisor. The content shared here is only for learning purposes. So please use your discretion to make any buy/sell decision and not use the above as a recommendation.

[Mudit.Kushalvardhan]

Hi @goofymanager
Pls direct me to some tools or some resources where I can calculate my returns like you do. Thanks

[Shashank_Mohan]

Hi @goofymanager me too would like you to share tool on hownto calculate above

[goofymanager]

@Mudit.Kushalvardhan @Shashank_Mohan i use value research online’s premium subscription to calculate. hope this helps!

[goofymanager]

A great investor is a great rejector

tldr - type 1 error (aka error of commission) can have more damage to our portfolio and return over a period of time, than type 2 error (aka error of omission) since markets like life is a constant battle of reality vs perception.

if above statement confuses anyone, just replace “actual = reality” and “predicted = perception” in the image while good represents “good companies” and bad represents “bad companies”. that should clear the picture.

we have to save ourselves from ourselves, where we perceive a bad company as a good one leading to a false positive narrative aka type 1 error aka error of commission.

[goofymanager]

“Process v outcome” - explained most optimally.

This thread on what delivers total shareholders returns over long time is more apt from the lens of process v outcome as well

Journey and Portfolio of a goal-based NEEV investor

The question is what are the individual contributors to Total Shareholders Returns? Here’s a quick snapshot of the drivers of TRS for the S&P 500 from 2012 till 2021 (source) [TRS] Total Shareholder Return = Dividend Yield + Earnings Growth + Multiple Expansion A concerning trend that we can immediately recognize is that P/E multiple expansion (i.e. the stock price rising faster than the underlying earnings) drove a significant proportion (41.6%) of the returns. This is problematic as winni…

[goofymanager]

Portfolio update (June 2024):

Update: Used 4th June market crash to deploy ~4% of cash in the existing portfolio (which gave >10% gain so far - luck has many names); namely TIPS LTD, IRCTC, COAL INDIA, VARUN BEV, NARAYANA and WONDERLA.

Also, 100% exited PHANTOM VFX (with minor tuition fees) position since the expected triggers did not pan out. New challenges from Gen AI continue to create difficulties in perception (although reality might be different). Also, the company’s corp governance wrt of disclosure looked lackadaisical (ref: June 1, 2024). Also “receivables” crept up to Rs 51 cr in FY24 from Rs 16 cr in FY23. The risk/reward of holding a micro-cap stock without growth triggers, corp gov challenges and unfavourable financials (receivables) doesn’t look favourable at this point. Hopefully, the learnings of this industry will help in the future.

Again, I feel there are very few opportunities for me right now. Hence, shoring up cash once again and spending more time expanding my circle of competence.

Although studying the paper Industry (have learnings from SATIA), co-working space, wealth management and few opportunities in spaces wrt premiumization trend.

Here’s my latest portfolio:

Stock name	Weight	Avg P/E	Current P/L	Total P/L	IRR %	Action
MOST 100 ETF	8.8%	17.9	66%	68%	32.9
BANK BEES ETF	7.1%	12.0	42%	42%	21.6
TATA INVEST CORP	6.9%	24.6	246%	250%	142.5
TIPS LIMITED	6.8%	20.4	102%	122%	56.8	Added more
BAJAJ FINANCE	6.7%	22.2	36%	42%	13.0
IRCTC	6.7%	29.0	145%	189%	53.5	Added more
DIXON	6.4%	42.1	355%	601%	101.6
COAL INDIA	6.4%	4.7	68%	74%	91.4	Added more
TITAN	6.3%	46.7	85%	101%	23.6
VARUN BEVERAGES	5.2%	53.9	82%	83%	64.8	Added more
PIDILITE	4.4%	56.6	64%	78%	19.2
AMARA RAJA *	4.0%	10.1	145%	146%	190.4
INDIAMART	3.9%	44.8	9%	51%	32.2
NARAYANA HEALTH	3.9%	24.1	29%	29%	32.3	Added more
ASIAN PAINTS	3.8%	46.1	9%	25%	8.0
CASH	3.8%	-	-	-
IEX	3.2%	14.7	213%	166%	22.5
TATA ELXSI	3.0%	34.2	61%	156%	50.1
WONDERLA *	2.7%	31.5	4%	4%	15.3	Added more

*(asterisk) signifies <1 yr holding period.

Here’s the return profile till June 2024:

TRI till June 2024	1M	3M	6M	1Y	3Y	5Y	Since inception
PORTFOLIO	4.9%	7.7%	14.0%	39.8%	14.5%	23.8%	22.3%
NIFTY 50	4.5%	8.2%	10.6%	27.0%	14.7%	15.4%	15.0%
NIFTY 500	4.7%	11.9%	16.5%	38.9%	18.4%	18.7%	16.3%

Note: 1/3/6M is in absolutes while the 1/3/5Y/SI is annualized. The inception date is 10th Nov 2016.

Disclaimer: I am neither a financial nor a SEBI registered advisor. The content shared here is only for learning purposes. So please use your discretion to make any buy/sell decision and not use the above as a recommendation.

[goofymanager]

INVESTING AS A HIGHWAY

[Investor_No_1]

@goofymanager

Note: 1/3/6M is in absolutes while the 1/3/5Y/SI is annualized. The inception date is 10th Nov 2016.

How are you able to calculate cagr returns since inception and over long term along with incremental addition of capital at various intervals in between till date?

[ValueV]

I use valueresearch website. You can upload your past trade transaction and it will calculate CAGR over different time period. Thanks!

[goofymanager]

Portfolio update (July 2024):

Short update

• Added more of COAL INDIA
• Exited 100% of ASIAN PAINTS since growth has stalled. Margin compressed due to competitive + raw materials price rise. BIRLA OPUS launch might stall growth for years. Will re-look at this space as I believe it’s an interesting proxy to play real estate
• Added EFC LTD as a new position with <2% allocation. Will share my rationale later.
• Portfolio churn remains <5%. Want to keep it <10% for FY.
• Continuing from last month, IMHO there are very few newer opportunities for me right now. Hence, shoring up cash and spending more time expanding my circle of competence
• Continuing to study wealth management space (but valuation is expensive for me)

Stock name	Weight	Avg P/E	Current P/L	Total P/L	IRR %	Action
TIPS LIMITED	10.3%	18.0	216%	236%	83%
MOST 100 ETF	8.4%	18.3	62%	64%	30%
COAL INDIA	7.5%	4.8	85%	91%	106%	Added more
BANK BEES ETF	6.8%	12.2	40%	40%	20%
TATA INVEST CORP	6.5%	24.6	236%	241%	131%
IRCTC	6.5%	29.0	144%	188%	52%
BAJAJ FINANCE	6.3%	21.6	30%	36%	11%
TITAN	6.2%	46.7	89%	105%	24%
DIXON	6.1%	35.3	344%	591%	100%
VARUN BEVERAGES	4.9%	48.1	76%	77%	59%
PIDILITE	4.3%	56.6	66%	80%	19%
CASH	4.2%	-	-	-	-
INDIAMART	4.1%	40.7	16%	58%	34%
NARAYANA HEALTH	3.9%	24.1	35%	35%	35%
AMARA RAJA	3.8%	10.4	139%	140%	156%
IEX	3.2%	13.9	231%	184%	24%
TATA ELXSI	2.9%	34.4	60%	155%	49%
WONDERLA *	2.4%	31.5	-4%	-4%	-11%
EFC LTD *	1.8%	46.2	1%	1%	22%	Newly added

*(asterisk) signifies <1 yr holding period.

Here’s the return profile till July 2024:

Total returns	1M	3M	6M	1Y	3Y	5Y	Since inception
PORTFOLIO	2.7%	8.8%	16.5%	43.2%	15.0%	25.7%	23.0%
NIFTY 50	3.7%	10.4%	14.5%	26.1%	16.3%	17.2%	15.3%
NIFTY 500	4.2%	11.9%	18.4%	37.6%	19.6%	20.6%	16.7%

Note: 1/3/6M is in absolutes while the 1/3/5Y/SI is annualized. The inception date is 10th Nov 2016.

Disclaimer: I am neither a financial nor a SEBI registered advisor. The content shared here is only for learning purposes. So please use your discretion to make any buy/sell decision and not use the above as a recommendation.

[goofymanager]

@goofymanager

• Added EFC LTD as a new position with <2% allocation. Will share my rationale later.

Date: July 2024

Business Model:
EFC (I) Ltd operates in the flexible office space sector, providing co-working spaces, managed offices, and turnkey project solutions. The company offers end-to-end services including leasing, interior design, and furniture manufacturing through its subsidiaries Whitehills Design Ltd and Ek Design Industries Ltd. EFC is also expanding into REIT and AIF initiatives to control and operate real estate assets more efficiently.

Industry Thesis
The flexible workspace market in India is experiencing rapid growth driven by increasing demand from startups, SMEs, and MNCs. This sector is projected to grow at a CAGR of 15%, offering significant opportunities for companies like EFC that can provide comprehensive, cost-effective, and customizable office solutions.

Competition pairing:

Note: EFC revenue is from FY24 (not FY23)

Industry Summary:

• Total Desks: 738,800
• Total Area: 42.4 million sq ft
• Total Revenue: ₹5,459 crore
• Total EBITDA: ₹2,554 crore

EFC’s Absolute Values:

• Desks: 43,000
• Area: 1.9 million sq ft
• Revenue: ₹428. crore
• EBITDA: ₹191 crore

EFC’s Market Share wrt:

• Desks: 5.82%
• Area: 4.48%
• Revenue: 7.85% (8% market share)
• EBITDA: 7.51%

EFC (I) Ltd has a substantial presence in terms of revenue and EBITDA relative to the total, despite having a smaller scale in terms of desks and area. This indicates strong operational efficiency and a competitive position in the market.

Primary Industry Drivers

1. Rising Demand for Flexibility: Increasing need for flexible office solutions post-pandemic.
2. Economic Growth: Expansion of businesses and entry of global companies into India.
3. Cost Efficiency: Flex spaces offer cost savings compared to traditional office leases.
4. Urbanization: Growth in urban centers driving demand for commercial real estate.

Primary Investment Rationale

1. Strong Financial Performance: Significant revenue and profit growth in FY2024.
2. Scalability: Ambitious expansion plans to double seat capacity by 2026.
3. Diversified Revenue Streams: Integration of REIT, AIF, and furniture manufacturing.
4. High Occupancy Rates: Consistently maintaining over 90% occupancy.
5. Cost Efficiency: Economies of scale and in-house capabilities reduce costs.

What I Like About the Business

1. Integrated Operations: End-to-end solutions reduce dependency on third parties.
2. High-Margin Segments: Expansion into furniture manufacturing with high EBITDA margins.
3. Strategic Client Base: Long-term contracts with large enterprise clients.
4. Growth Potential: Positioned well to capture the growing demand in the flex workspace sector.

What I Don’t Like About the Business

1. High Capital Expenditure: Significant upfront investment required for expansion.
2. Market Competition: Intense competition from established players like WeWork and Awfis.
3. Debt Levels: Potential risk from high debt used to fund growth and REIT initiatives.

Trackable Growth Drivers

1. Seat Capacity Expansion: Doubling seats to 92,000 by 2026.
2. Furniture Manufacturing Launch: Expected revenue of ₹300-400 crore annually.
3. REIT and AIF Initiatives: Additional revenue from managing real estate assets.
4. New Leased Spaces: Adding 400,000 sq. ft. in major urban centres.

Risk Factors

1. Market Competition: Price wars and reduced margins.
2. Economic Downturns: Impact on demand and occupancy rates.
3. Operational Risks: Project delays and quality control issues.
4. Regulatory Changes: Compliance costs and restrictions on operations.
5. Technological Disruptions: Adoption of remote work reduces demand for physical spaces.

Valuation Expectations (July 2024)
The company looks favourable from the forward multiple (although would have liked MoS at current levels i.e. P/E less than 30). Currently, the company trades at 45x P/E with an expected EPS growth of min. 30% YoY

[goofymanager]

@goofymanager

TITAN 6.2% 46.7 89% 105% 24%

Titan published this data in their recent Q1 FY25 presentation:

Now I tried comparing Titan (a house of brands) with LVMH. Results are interesting:

Category	Segment	Titan Brands	LVMH Brands
Jewellery	Luxury	Zoya	Bulgari, Chaumet
	Premium	Tanishq	Fred
	Mid-Market	Mia by Tanishq, CaratLane
Watches & Wearables	Luxury	Nebula	TAG Heuer, Hublot, Zenith
	Premium	Edge by Titan, Xylys	Dior Watches, Louis Vuitton Watches
	Mid-Market	Titan, Raga by Titan, Fastrack
	Mass Market	Sonata
Eyecare	Premium	Titan Eye+
	Mid-Market	Titan Eye+
Indian Dress Wear	Premium	Taneira
Fragrances	Luxury		Dior, Guerlain
	Premium		Givenchy, Kenzo, Benefit Cosmetics
	Mid-Market	SKINN, Fastrack Perfumes
Fashion Accessories	Luxury		Louis Vuitton, Dior, Celine, Loewe, Givenchy
	Premium	IRTH	Kenzo, Fendi
	Mid-Market	Fastrack
Wines & Spirits	Luxury		Dom Pérignon, Moët & Chandon, Veuve Clicquot
	Premium		Hennessy, Glenmorangie
Selective Retailing	Luxury		Sephora, Le Bon Marché

Tl;dr my thesis in investing in Titan is not just a jewellery brand (although 80% of business comes from Jewellery today).

But its final destination is Indian LVMH – started from India, and expanded globally.

[Investor_No_1]

@goofymanager

But its final destination is Indian LVMH – started from India, and expanded globally.

nice comparison…very seldom find thought provoking and visionary comments these days…so thanks…
I did a quick check on history of LVMH stock and saw its history since 1990. The stock has grown approximately only 31 times in last 34 years. From 1990 till 2000 peak, approx 6 times and in next 24 years, it grew not even 10 times….

35 years is a very long time from even Europe perspective and stock gave around 10.6% cagr, which is fine for a big company to start with 35 years back. Was LVMH already a big conglomerate of brands in 1990?

Why in last 35 years when premiumization across globe is the buzzword, it managed to grow only at 10.6% cagr? Was it because the valuations were pretty high in 1990 or even in 2000 etc? It currently trades at 22 pe which is moderately high considering European companies….

Do you expect such growth from Titan over next 35 years or so?

LVMH seems to have focussed on only premium categories, has it ever ventured into any mid or mass market brands….i don’t think so. Also, has LVMH created brands from scratch or mostly acquired them?

Lastly what is the motivation of LVMH to buy any brand or make any brand and how similar or different that motivation is from Titan? For me, this would be the most important question to ask ourself if we are comparing these two.

As you did excellent comparison between the two, I thought to put some intangibles into picture and would be nice to get your thoughts as well.

[goofymanager]

@Investor_No_1

I did a quick check on history of LVMH stock and saw its history since 1990. The stock has grown approximately only 31 times in last 34 years. From 1990 till 2000 peak, approx 6 times and in next 24 years, it grew not even 10 times….

35 years is a very long time from even Europe perspective and stock gave around 10.6% cagr, which is fine for a big company to start with 35 years back. Was LVMH already a big conglomerate of brands in 1990?

Yes, LVMH was already a significant player in the luxury goods industry by 1990. The company was formed in 1987 by merging Moët Hennessy (a producer of champagne and cognac) and Louis Vuitton (a renowned luxury fashion house). By 1990, LVMH had already acquired several other luxury brands and had established itself as a leader in the luxury goods market, encompassing a diverse portfolio of products including wines, spirits, fashion, leather goods, perfumes, and cosmetics.

@Investor_No_1

Why in last 35 years when premiumization across globe is the buzzword, it managed to grow only at 10.6% cagr? Was it because the valuations were pretty high in 1990 or even in 2000 etc? It currently trades at 22 pe which is moderately high considering European companies….

Every company is a mere reflection of the economy/market it operates in. LVMH specifically operates in a mature market where growth rates are typically lower than in emerging markets (no prizes for the guess).

High valuations in 1990 or 2000 could indeed have influenced LVMH’s subsequent growth. If the stock was trading at elevated PE, the growth in earnings would need to be substantial to justify these valuations, which can be challenging for an already large and established company. The current PE ratio of 22 is relatively high for European companies, indicating strong investor confidence in LVMH’s brand strength and prospects, but also reflecting the premium that investors are willing to pay for exposure to the luxury sector.

@Investor_No_1

Do you expect such growth from Titan over next 35 years or so?

Titan has the potential for significant growth over the next 35 years due to several factors like expanding middle class, international expansion (nice little optionality), diversified portfolio (above comparison table) and ongoing digital transformation going D2C.

@Investor_No_1

LVMH seems to have focussed on only premium categories, has it ever ventured into any mid or mass market brands….i don’t think so. Also, has LVMH created brands from scratch or mostly acquired them?

LVMH has primarily focused on premium and luxury categories and has not significantly ventured into mid or mass-market brands. The company’s strategy has been to maintain a strong brand image and high margins (LVMH’s gross margins are around 70% and EBITDA margin are around 30% while Titan’s gross margins are sub-25% and EBITDA @ 10% currently), which is consistent with its focus on the luxury market. LVMH has largely grown through acquisitions of established luxury brands rather than creating new brands from scratch. Notable acquisitions include Bulgari, TAG Heuer, and Tiffany & Co. When LVMH does develop new brands or product lines, it often leverages the equity, marketing and distribution prowess of its existing brands.

@Investor_No_1

Lastly what is the motivation of LVMH to buy any brand or make any brand and how similar or different that motivation is from Titan? For me, this would be the most important question to ask ourselves if we are comparing these two.

LVMH’s motivation for acquiring or developing brands is driven by several factors like brand equity, market expansion, market & distribution synergies and continuously maintaining a portfolio of prestigious brands to drive exclusivity.

Titan’s motivation, while similar in some aspects, also includes market penetration and brand building across categories since IMHO they started off this process post-2016 (after acquiring Caratlane).

The way I look at Titan is:

- Early 2000s: Watch brand
- 2000-2020: Jewellery brand
- Post-2020: Lifestyle brand (Indian LVMH)

Hope this helps!

[hardik_shah1]

Fantastic Summary.

While I agree with majority of what has been conveyed but would like to point out few places where the story hits speedbumps.

On the jewelery front, no complaints with execution, marketing or the recent expansions with Carat Lane and overseas Tanishq outlets.

Watches as a category they are doing well. But there is lack of significant growth whether it is in smartwatches or core business. I think two-year CAGR is just 10% when they should be dominating in smartwatches. Again 10% is not bad but it is not something that is exciting.

On the Eyewear division, they have completely dropped the ball. This should have been a business where they could have touched the watches business in terms of revenue but have significantly underperformed with too many changes in management, Franchisee formats etc. They have lost first mover advantage to Lens Kart and others and now changing strategies to try and catch up.

My overall concern is there are Jewelry dependent, and their growth will be tougher with more competition on organized side, city and region-based players now are updating brand presence and ensuring quality and therefore retargeting customers they lost to Tanishq. This is something management themselves acknowledge in FY24 concall.

I love the brand, use it and of course it has had phenomenal staying power over last few decades and shown the ability to manage frequent thorns in the road, but this is just to give a not so rosy picture.This slightly negative viewpoint is just to show that they have hurdles to cover.

P.s : To get to LVMH status they need to upgrade across product, marketing internationally.

Disclosure: Have invested in recent correction through family PF.

[Investor_No_1]

@goofymanager

Every company is a mere reflection of the economy/market it operates in.

May or may not be true or partially true. Growth rates of Fang stocks for example in US does not mirror their economy growth rates at all.

@goofymanager

LVMH has largely grown through acquisitions of established luxury brands rather than creating new brands from scratch

This very statement proves to me that Titan is not an Indian LVMH. Their DNA is hugely different and I would rate Titan at a much higher pedestal with ability and inclination to create brands from scratch.

[goofymanager]

@hardik_shah1

My overall concern is there are Jewelry dependent, and their growth will be tougher with more competition on organized side, city and region-based players now are updating brand presence and ensuring quality and therefore retargeting customers they lost to Tanishq

I agree. Hence, I track this QoQ and subsequent management narrative around the same.

@hardik_shah1

I love the brand, use it and of course it has had phenomenal staying power over last few decades and shown the ability to manage frequent thorns in the road

My primary bet on TITAN is its staying power in a tough competitive environment (like it has done in the past), thus elongating its terminal value in decades to come.

Also, it goes with my investment philosophy of BUY, HOLD $ TRACK

[goofymanager]

Q1 FY25 results are out for my companies.

Here’s what it’s looking like (in descending order wrt to YoY sales):

Company Name	Sales YOY (%)	EBITDA YOY (%)	Net Profit YOY (%)	EPS YOY (%)	Stock return (YoY)
Dixon Tech	101	88	99	93	156%
EFC Limited	81	59	376	125	154%
Tips Industries	40	55	61	62	143%
Bajaj Finance	29	27	31	11	-8%
Varun Beverages	28	32	26	26	68%
IEX	19	23	26	27	47%
Indiamart	17	62	35	40	-16%
Amara Raja	13	17	23	15	153%
Titan	12	11	-5	-5	13%
IRCTC	12	9	13	33	40%
Narayana Health	9	12	9	9	68%
Tata Elxsi	9	0	-3	-3	-3%
Pidilite	4	15	21	21	19%
Coal India	1	6	4	4	116%
Tata Invest Corp	-6	-8	-11	-11	140%
Wonderla	-6	-22	-25	-25	25%

Note: YoY return is 1y return till 14th Aug 2024.

Some personal notes I have learnt as an entrepreneur:

• Growing sales/topline is much harder than profit growth
• Stock performance might diverge in the short term (1-3y) but mostly converge in the long term (5y+)
• So in the short term, a lot of weightage is to be given to sales growth & OPM