ValuePickr Forum

ValuePickr 2.0: Time to Review 2010-2019, and set Roadmap for the next Decade

Hi Guys/Ladies,

Greetings in the New Year!!
Its been a long sabbatical :slight_smile: . Last I posted was probably in Mar 2018 on NGL Finechem! I regret the prolonged absence - much of it was unavoidable due to (energy sapping) poor personal health issues (compounded also by my own indiscipline) and critical condition of some elders in extended family. The good news is, as we struggled through and came to terms with the loss, the worst is probably over - I have learnt to manage the chronic condition much better, have regained back much on the health front.

Of late my VP friends/colleagues kept urging me, that while fortuitously it was probably the best time to sleep through the carnage of last 1.5 years, its high time I stepped back in the ring; high time we reignited much of the passion we were known for when we started out in 2010; high time we kick-started fresh initiatives to build on an excellent foundation towards extending VP’s sustainability and longevity - the VP Competitive Advantage!!

The keyword being reigniting the “Passion”!! I have no hesitation in owning up that I struggled for answers for much of last couple of months and more, until a simple observation offered me the most profound insight. What worked for us best in 2010 was that we found a way to involve and collate insights/advise from best of investing minds (that we had/could get access to) in a systemic way for influencing and directing our individual and community’s concerted efforts towards getting better at the Investment game.

So then 2020-2029: What’s my Role in Team VP
Don’t have to do much different now!!

Investment Learning Curve
My “role” remains that of the catalyst to attract smarter and smarter folks (skills we admire) around Team VP (get inside their heads, sort of) in a bid to distill and communicate back to the VP Community all that wisdom in crisp and hard-hitting ways (that hopefully doesn’t drown in our information overload age). But, now that us greenhorns have spent a decade ourselves in the market there is phenomenal track record, and diverse skills in Team VP itself :astonished:, it’s imperative for me to first harness and capture that :slight_smile:. Have already started the process, met up some VP and non-VP folks I admire last week and this, in Bangalore. Next week I am in Kolkata, and will catch up with some dudes there!

Expert Network
This may not be top-of-mind off hand for most of us but if you think about it, Team VP’s informal Expert Network - highly skilled domain professionals in every conceivable field/niche - basically our Go-to-Guys - who simplify, help us make sense of complex stuff and provide us huge domain insights (that otherwise we may spend enormous time and effort and still not get to real grip on) is simply huge. It’s such an incredibly rich resource base - something that we simply HAVE TO FORMALISE and leverage towards the community’s advantage. This will need sustained focus and drive (and active collaborators, more on that later) to deliver on, something I am sufficiently charged up to commit devoting significant energy and passion towards - as I can almost envision the grand outcome :wink:. Again as I ponder on this, there is no gainsaying within VP itself (~30K user base) every guy/gal is a domain expert in his/her own roji-roti - profession/business/trade!! Besides, there are a few guys within VP (and outside) on my radar who have taken such deep dives within a Sector, that they themselves might soon qualify to be a Sector Expert!

By now, most of you must be coming round to …theek hai baba…yeh sab to theek hain…anytime you showing me the Money?? Where are the real Actionables???

Hmm! A good answer is to redirect your attention that hey let’s concentrate on the process, the results will speak for themselves (like every Team India cricketer we see espousing today, and rightly so). But no, a better answer is that we are again re-dedicating us to being ACCOUNTABLE for all the free “timeless gyan” that we spend much energies on re-packaging and re-emphasising :slight_smile:.

VP Public Portfolio
Some of the recent VP members may not know that our singular claim to fame in the first five years (2010-2015) was the hugely successful experiment around maintaining a VP Public Portfolio that we initiated within the first year, and updated regularly every 6 months. We were extremely lucky (business/industry tailwinds and very cheap valuations) and the experiment had a phenomenally successful track record (Mayur, Astral, Ajanta Pharma, PI industries, Poly Medicure, Alembic Pharma, Atul Auto, Canfin Homes, Avanti Feeds are top of the mind recall) - simply amazing to recall that home run stretch - many old-timers within and outside VP inform us whenever we meet, that this singular aspect was hugely impactful in their investment journey (just as it was in ours).

As I ponder about this, one aspect of the investment process diligence is brought home to me very very powerfully. We held ourselves accountable, and we did the due-diligence every 6 months first individually and then among the VP Core group, debated at length and then put up the buy/hold/sell recommendations, even as many of us individually might have had slightly divergent viewpoints on inclusion/exclusion of certain picks and Portfolio composition (without much market cycles experience -not really, we weren’t suave enough then).

Key is we tried to deliver as much of a risk-mitigated call as our collective skills then permitted. And proof of the pudding was in the eating - while our buy calls were always luckily on the money, our exit calls were also equally bang on in avoiding any draw-downs. We might have erred massively in recommending quitting Suprajit Engineering early as also an Astral Poly after 3 years, but we could anticipate business deterioration and correctly called an exit on Gujarat Reclaim and Atul Auto in time after a phenomenal run. There may have been many acts of omission, but perhaps there was hardly a single mis-step or big drawdowns! Yes we were LUCKY, but due credit would also be given to our solid INTENT, and some to adherence to due process (even as they might have been half-baked then).

Long story short, the very fact of being accountable for the VP Public Portfolio forced a certain kind of collective diligence on us and adherence to due process. Unfortunately we had to voluntarily stop the VP Public Portfolio service in 2015 once the SEBI regulations were announced on Buy/Sell/Hold recommendations, as we did not want to run foul on Compliance and endanger the VP Community survival itself based on the strict advise of many of our seniors/well-wishers and Mentors.

As a fallout and a big contributory factor (in hindsight) perhaps, during 2015-16-17 we have seen many cases where after years of tremendous run like in Ajanta Pharma, Alembic, Shilpa Medicare, Kaveri Seed, Kitex, and Avanti where we collectively did not debate/make exit calls (individually we consulted and some made the right smart calls, and some like me stubbornly stayed put in their favourites :wink: ) neither did we find a good way to flag it to the community in time to avoid big drawdowns in some, albeit all would have made significant money in these businesses despite drawdowns.

VP Model Public Portfolio 2.0
As we all probably have experienced individually and among investors we know, the runaway hits in 2017 yanked most of us away from due process - it was too easy to make money, anything with a hint of quality/growth were out of reach if you didn’t act in 2weeks :slight_smile:; everyone was probably guilty of diluting our own standards on Valuation/Conviction in small or large degrees. And we have all seen the result of that in 2018 with some pain still continuing for many of us, especially in our favourite small cap space.

So while we cannot continue with buy/sell/hold recommendations like we did in 2010-2015, what we can certainly do is put up a VP Model Public Portfolio that is current and accessible to everyone that we update periodically (as needed) with the same due diligence as before, but without the attendant time-sensitivity of before. We enable the next best option of providing a periodically updated Guideline/Model Portfolio that we will again hold ourselves accountable for. I am convinced this will be both for our own individual good as well as for the VP Community and the larger investment community.

We are ALWAYS willing to put our necks (and some not-deserved reputations) on the line, in order to learn from the mistakes, and steepen the Investment Learning Curve. There is no reason why again we can’t deliver a satisfactory public performance record, as collectively we are supposed to have matured and become more refined investors :wink:, even as we will have to depend much more on skills than luck to ensure repeatability of success.

As we embark on a new decade, we rededicate VP to the Goals we started with in 2010 - Democratic (free unfettered access to all), Actionable Insights, Accountable.


By the way, the biggest example and inspiration for democratic access in our Markets today is Ayush Mittal and Pratyush Mittal’s Screener.in - which they keep refining and making it more useful, every year. (Did you know VP was the first in India to debut with a techy power-user kind of screener in 2010, and likes to claim the credit for inspiring Pratyush for his extremely user-friendly version debut).


A big thank you to all of you for making VP what it is today !! Looking forward to see how this resonates with you. Your views and active participation in this re-dedication bid is invited. I will be grateful if all of us remain slightly conscious of not cluttering the thread and try and respond with actionable suggestions around what I like to call the Investor Learning Curve - stuff around what and how we can refine and actively participate on 2.0 Frameworks for Stock Picking, Business Models and Business Quality, Management Quality, Capital Allocation, Portfolio Structure and Management, Expert Network, Scuttlebutt Network, Management Q&As, Stock Stories, most importantly THREAD CLEAN UP, and other aspects in VP that you think needs FIXING, that may be your top of mind, or come to you as you ponder on above.
Thank you for your patience, on what might have been a long read. I hope it proves useful enough to spur energy and passion back into VP discourse, as much as it has energised me.

Before I forget, no amount of gratitude is enough for the selfless work continued dedicatedly by VP stalwarts like Hitesh (hats off to you Sir). Abhishek & Manish Vachhani both deserve special mention on their additional but thankless moderation workload. Ayush, Dheeraj, Kedar (Zygo), Yogesh Sane, Ankit Gupta, Rupesh Tatiya, Sandeep Patel for their consistent dedication as also the newer set of Top Contributors like Rupani Amit, Bharani (Phreak), Rahul, Vivek Mashrani, Kumar Saurabh, Harshit Goyal, Deepak Venkatesh, Narendra - I am hoping to meet up soon with and pick their brains. They all deserve a toast for their exemplary contribution towards making VP what it is today!! As do folks like Dhwanil Desai and Anant Jain who have contributed immensely in the recent past even if not immediately noticeable(?) in the past year (like my absence for past 2 years almost). Another big hurrah for probably the most special contribution - Pratyush Mittal - for brilliantly addressing all the tech requirements for VP Platform single-handedly.

Request VP old-timers and Top Contributors to also put their hands-up here on any aspect from these Actionables mentioned, or something not mentioned that energises them and would like to get their hands dirty with and/or drive the effort. If anything, it will expose commonly desired Actionables to many new members and help energise them into collaboration efforts.

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Donald,

Good to have you back. I had heard from the grapevine that you were ill and VP was riding entirely on the shoulders of Hitesh. Missed all the multibaggers discussed on VP, but have no issues. The learning process from being part of this group has been tremendous. I hope this will continue into the future as well.

Shiv Kumar

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Welcome back Donald. Without your prodding to action, investing life was not the same :slight_smile:

With a huge number of new VP members, there is a pressing need for getting back to the basics on our learning and generating actionable insights.

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Thanks Shivkumar. Hope to see you actively participate once again.

@basumallick
Wonderful. Would you like to elaborate a little - just 2 paras maybe on your current interest area as discussed recently - on mapping diverse business models, and business quality hierarchy that you wanted to take forward in 2020.

Would love to hear back on that also from @desaidhwanil - who I know is probably the most committed to business-model thinking among us all; this is always there in his investment choice vocabulary, whenever I hear him talking about a business - which means he consciously always segregates businesses on business model strengths/uniqueness, apart from other essentials that we seek in a business.

I know for one, while I may talk about this from time to time, this is not my strength area; I don’t do it consistently enough, its not part of my sub-conscious segregation/prioritisation thinking while assigning a sustainability/longevity score on Business Quality. This is big on my wishlist too. Would love to work with you guys here.

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Welcome back Donald. Your tone exhibits your spirit and health. I wish you good health and spirit. I am excited to see you participating in forum to increase the learning curve of members. I will also contribute.

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I am so excited that this is happening. I used to always feel that I missed an opportunity in participating in one of the best collaborative exercises ever for analyzing equity.
I joined in 2017 when I started investing seriously. Of course starting at almost a peak of bull cycle meant that valuations were really high which I didn’t realize because of my fresh entry. In last 2 years or so I have gone through countless old threads and learnt how to analyze businesses. Of course still long way to go. Last 2 years of correction has also taught me important lessons early on in my investment journey.
However, thanks to the knowledge available here. I had learnt that you’re supposed to be most active when market is dull and boring. In last 2 years while my portfolio was bleeding I consciously kept myself pumped and kept working on my portfolio. I can’t thank enough all the top contributors for the great insights and teachings. I hope to participate more actively and be part of VP 2.0 in a big way!

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Welcome back Donald. Good to see your post. Wishing you all the best. And inspiring all to take VP platform to next level.

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Welcome back @Donald

Most excited to contribute to VP 2.0.

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Welcome back Donald sir .It feels like you have hit the refresh button and instilled new energy and passion.
Excited to see the version 2 of value picker .

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Glad to have you back Donald! I have gone through some of your earlier work, especially in the resources section and showcase discussions. There is tremendous amount of timeless knowledge hidden there. You were visibly instrumental in laying the right foundation for VP along with other founding members, as is witnessed from the growth of the forum over the years.

Below, I have put together some thoughts for VP 2.0. While many of below points are covered in VP threads in some form or the other, a more formalized effort to have these covered for all major picks would be great. Getting some of the below information can be difficult, and given the subjective nature of some of these aspects may also lead to heated discussions. But I hope that as we evolve as a community, these shall lead to enriching information for all of us:

1. Management:
Given the subjectivity involved, I believe there is more work required in putting this together. Some of the points that could be covered:

  • Educational background and any other qualifications/awards
  • Capital allocation capability basis past history
  • Network - Position in any industry associations etc.
  • Succession plan

2. Market size and industry outlook:
Helps understand the market better and evaluate the potential of the company

3. Buyer/supplier linkages and reference checks:
Helps evaluate any concentration risk, years of relationship etc. with buyers / suppliers. Also independent reference checks can give first hand feedback about the market reputation of the company/promoter amongst other things. Good banks carry out a similar exercise before lending to a corporate.

4. Key items to track:
e.g. Raw material/final product price and source to track. Especially important given the number of stocks which have had a windfall in last couple of years over non-sustainable events.

5. Wiki type page:
Finally, given the possible information overload wherein important information may get lost, I suggest that we can have a wiki-type collaborative page running in parallel to the more discussed threads. This will also be a sort of solution towards the thread cleanup objective. The wiki page will try to put together the information in the thread in crisp and hard-hitting manner. It could be organized in pre-defined sections basis what aspects we believe should be generally covered for any stock/other discussion.

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Hey Donald been a fan , follower and student of this forum since 2016…
Needless to say a non financial background guy like me achieved my initial footsteps of stock market journey because of valuepickr knowledge and discussions… It was a institution which hand held me during my walk… Whenever I faltered I came back here… Whenever I tasted success I came back here… Even my present journey is happening because of value pickr… Extremely fortunate and lucky because of this… HOWEVER LATELY THE DISCUSSIONS ARE GETTING VERY DILUTED… of course as many newbies enter the market the job of moderators also gets difficult… Need to do something so that the threads doesn’t get diluted…
Hoping u will pull it off once again…
On a lighter note add " Girls " To ur introductory message where u hv typed guys and ladies…
Or else girls and ladies will both take offense to that sentence :grinning:… Excited about 2.0 cheers and a HAPPY NEW YEAR

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Good to hear from you Donald and glad you are back, would love to be part of VP2.0!

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@jitenp
Your skill set Jiten is one of the rarer ones, especially here at VP. And it’s big on my wish list to work with you to find a good way to transfer cyclical thinking discipline to VP members.

It’s not easy to stay with for someone uninitiated in the art, as I have seen with my fledgling attempts at sugar and steel. Vicarious learning is difficult. You probably got to make your own mistakes over one or two cycles, before you get it. However I am told this that once you do GET IT, repeatability of success is very high. And have heard/seen my first Mentor Subhankar Ghose in Kolkata (a market veteran) repeat success in Tata Steel and Tata Motors over and over again.

Love to work with you collaboratively on the next cycle at play, and capture the finer nuances for the VP Community. Did I hear you mention somewhere that It’s the right time now to start on the Cement cycle?

@bargainHunter
Thanks a lot for your suggestions. As you mentioned, many of these are attempted before and hanging somewhere and can be much more effective with more focused effort. Stock Stories are actually wiki pages :slight_smile:, only we need to be careful with permissions and ofcourse we need a committed band of volunteers interested and gifted in creating crisper summaries. Working Templates exist …may be we can relook and relax the ultra crisp template to enable more free flowing text, but still be forced to capture the essentials.

We do need to take this forward better. Would love to see more show of hands taking responsibility and driving this. @Yogesh_s I know was the first to volunteer as soon as he had joined VP, I was a bit too rigid that time on a templated format. Would love to hear your views Yogesh, you have had much more time with VP now and the pressing need for de cluttered recent takes on a business. Would love to work with you and BargainHunter and devise a good way forward.

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Welcome back Donald. Sorry to hear that you were unwell but Very happy that you are back .I wish you good health and good luck. Let’s us all take VP platform to next levels👍

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Welcome Back Donald :slight_smile:

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Thanks Donald. I have shared my learnings from experience in the markets. It all started with the BOPET (polyfilm) cycle of 2010. Post that started thinking on those lines and over the years started putting together a framework for this, which obviously remains a work in progress, always. And have started sharing these learnings on different platforms/mediums. The one thing I want to emphasize is that markets are much more cyclical then what people think. I am planning to add more more thoughts on how to deal with this in my recent presentation (cycles 2.0) and will share soon. Looking forward to engage more on VP 2.0

And since my firm is a registered IA, I will not be able to share any buy/sell/hold views on any stocks. But have been giving views on various companies from operations/sector perspective and will continue doing so.

VP remains a very important thought bouncing/learning resource for me, and am willing to take it forward, as much as time permits me.

Coming on the cyclical themes, I have been bullish on cement and telecom for some time. In cement one can have a 2-3 year view. Telecom, I think has now become a long-term theme. Stock selection remains key, of course.

Regards,
Jiten

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Wonderful. That will be great

Understand and respect the constraints. All of us have our own set. What we appreciate most is the willingness, and finding a way to give back whatever we can, even while dealing with the constraints.

Simply wonderful to hear that. Let’s engage offline to understand more on what can be done better with your help and expertise.

:thinking: Guys/Gals, time to be curious, and put on some thinking hats. Call to action has been sounded

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Donald welcome to action mode and heartily Greetings to you and all VP in the New Year! 23 edits in your own post @Donald Hatsoff to you Sir, it is really worthwhile reading each single word coined by you in your opening note and it a great effort with resilient passion yet in prudent manner that you kept the burning desire to learn and share within each of the VP tribe folk who always justify the motto separate the chuffs from the wheat. Though lots of recent AI machine participation in trading with quant backed strategies, I still believe that nothing can beat the collaborative effort of the individuals. Each trade has two side like buying and selling but really worth is to stand on other side of the trade that why other fellow is buying or selling we are slave and subject to our own biases, which is offset by adhering to due process.
THE PROCESSES will only ensure towards extending VP’s sustainability and longevity – and sharp the VP Competitive Advantage with feedback loop of modifying the Processs , I am student of investing with strong passion to learn and share and happy to collaborate in VP 2.0.
Your met VP in south Bangalore and now heading to east Calcutta, I being from north extend warm welcome if you plan to come in north as well.
I may not be an expert but what I feel I am sharing towards 2.0 Frameworks
• Stock Picking
Mostly as we all use screener to arrive a probable list based on fundamental ratios, But more shovel work if done on AR it provide the sluggishness / negative aspect of management and their practices which help in eliminating the company we look for the investment. Strategy should be eliminating the bad company or bad premotor led companies rather than selecting –My personal feeling no company is bad but it might be in bad cycle and in bad share because the management is not able to allocate the resources properly. SECTOR WISE TEAMS may be made to curtail the bad candidates.
• Stock Stories: these should be grouped based on sector and when new thread is opening it must first select sector as sub head from the major head. With growing number of VP members the number of moderators should be increased based on expertise of domain .
• THREAD CLEAN UP : These can be trimed using various text field length filters e.g one liners or price movements .
Regards

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Thank you Rohit. Great to hear back from you. Someone told me recently you are now in Bangalore.

Remember the Ambika Cotton, and the MPS exercise with you majorly involved. Will be good to revisit our earlier frameworks, plug the gaps in understanding/analysis and simplify :wink:. Business Quality 2.0 thread started. Love to see your participation in the new initiatives planned.

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@Donald Great to see this thread and glad to have you back with added vigour! Mostly been on the sidelines of the Valuepickr though been a follower since 2010 and benefited enormously with the knowledge that flows here. Determined to change that in the new decade and turn a contributor to the forum!

The only thing that could be done better is - DOING THE SAME THINGS CONSISTENTLY AND GOING BACK TO THE WORK MODE of 2010-15!

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