Vishnu's Portfolio

Hello All,

First off, I need to apologize to all the senior folks at VP and the community at large for going incommunicado without notice.

It has been 2 years since I last visited the forum.

Liquidating part of the portfolio to help out with my brother’s financial needs, cutting short my full-time investing journey and getting hired again on contractual basis, getting married 1 week post demonetization necessitating the need to liquidate the rest of the portfolio to help fund it, being diagnosed with Type 2 diabetes when switching jobs in May 2017.

Phew! Life sure was eventful, but definitely blessed for the adversarial experiences. Looking back being diagnosed as a Type 2 Diabetic was a silver lining which completely changed my world view. Reading up about the etiology of the disease, I have a newfound appreciation for the human body and other complex systems which operate at multiple layers with each layer generating totally unexpected emergent properties but tightly controlled through multiple feedback loops.

Turned me bearish on pharma from being a perma-bull. In fact, I was hoping to hold Shilpa, Alembic and Syngene for the next 10 years. Lucky for me, I sold them off due to reasons explained above (and nothing to do with the industry. I possibly could have been holding on if circumstances were different)

Past duds from my previous portfolio (at time of liquidation) were Genus Power, Camlin Fine Sciences, Ortel Communication.

My portfolio today consists of only the following 3 stocks which I have been accumulating over the past 6 months:


PF is down 15% as on date.

I have bought Prabhat and Thyrocare with the aim to hold for next 10-15 years.
Snowman is relatively medium term for next 3-5 years.

Stock Rationale for each of the above 3 picks:


  • Milk, Curd, Butter, Ghee being largely unprocessed (No vegetable oils used) and unlikely to be replaced.
  • Dairy to become stronger when people realize the harm of fat-free/low-fat/cholesterol-free products such as skimmed milk.
  • Focused on Maharashtra Tier 2 and 3 towns, rather than compete with biggies in the metros.
  • Increasing capacity utilization of cheese and other VADP.
  • Capex phase done and focusing more on Advertisements & Promotion.
  • Product Quality expected to be good on account of being a B2B supplier to Mondelez, Abbott and others.
  • Decent promoters building business slowly while maintaining a balance between high RoIC milk & curd segments against capital intensive VADP (cheese).
  • Risks: Entry of Hatsun in Maharashtra increases competition, given their ability to outspend in terms of A&P.


  • Quantified-self movement where increasing use of health sensors make people increase the frequency of their wellness testing independent of any sickness (Feedback loop, Baseline, etc.)
  • Govt Regulation (Lab Compliances) and Pricing measures to benefit Thyrocare on account of being lowest cost provider.
  • Neutral to morbidity numbers. If there is increase in chronic illnesses such as Diabetes or Cancers, it is likely to increase the use of PET CT or their Diabetes profiles. Even if people were to follow LCHF to prevent/reverse diabetes they are more likely to maintain the frequency of testing to a quarterly level.
  • Increasing importance of inflammation markers, Insulin and Liver enzymes.
  • Insurance companies which decides to price the premium based on certain biomarkers such as HbA1c, Insulin, or even Cholesterol numbers.
  • Risks: Disruption by Point of Care devices (Sano) which can perform multiple tests. Mgmt is confident that it can pre-empt it. (At this point, I give them the benefit of doubt given that they have SugarScan Blood Glucose devices. If they can manage to create a low-cost CGM directed towards patients, they may have a killer product)


  • Largest cold chain company in India. Very capital intensive. They haven’t yet reached scale economics. Their metrics compare well to the largest cold chain company in the world (Americold).
  • Possible benefits from IKEA, given that the deal encompasses the logistics for all in-store restaurants. Increased consumption of frozen meats (Startups such as Licious, FreshToHome, etc), proxy to shrimp exports, govt push on cold storage transportation and warehousing.
  • Good CEO in Sunil Nair who is an industry veteran having helped Coldex Logistics to scale up.
  • Risks: Failure in execution of capex which mgmt plans to embark on after a gap of 3 years since IPO. Likely deterioration in debt metrics.

Stocks on Watchlist: Hatsun, Balaji Amines.

Feedback invited.


If anyone would like to read about my Type 2 Diabetes reversal journey can visit the below link:

If you would like to know more about LCHF and “skin in the game” patients who have managed to reverse not just Type 2 Diabetes but other chronic illnesses, please join the community through this link:


Hi Vishnu,

Great to see you back on the forum and hope you can contribute towards it. Your data mining capabilities are one of the best we have on the forum.
On portfolio front, I am nobody to comment on it but may be you can diversify a bit more.


Hi Vishnu

Great to see you back. Keep posting.

I am slightly skeptical about diary companies. I don’t think diary is an easy business to scale.

Cold chain logistics is a great business. Don’t know snowman in particular though.

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Welcome back Vishnu. Congratulations on your marriage and also on your success in reversal of diabetes.

Great to see you back Vishnu.

Coming to the picks you mentioned in your portfolio,

Prabhat Dairies. I think although the runway for growth for most milk companies is pretty long, I am not too sure that it will turn out to be too profitable. I have looked at Hatsun in the past and did not get convinced about its merits inspite of well kwown investors like Sumeet Nagar being gung ho on the company. Its a business which will need continuous investments and is subject to government interference. And with Amul being the big daddy around, these smaller companies would I think find it difficult to grow profitably. And with the recent correction and maybe more to follow till next elections, I feel there could be some sitters on the way.

About Snowman also till now they havent demonstrated a great record in profitability inspite of being one of the few players in cold chain logistics. I have heard it being mentioned as the next big thing by a few experienced investors I met recently but I would like to see the company report decent nos first before taking it seriously.

Thyrocare remains well placed to capitalise on the increasing life style diseases incidence in India. It has a good jockey at the helm. And it is in a space which is largely dominated by unorganised space. So if one has a multi year call and if management plays its cards well it can be an interesting story. As of now it remains in my watchlist.


Thanks @ankitgupta, @basumallick and @akbarkhan. It is good to be back. Looking forward to contributing more hopefully with a different perspective.

Thanks, Hitesh Bhai.

I am in agreement with you about the fact that diary requires continuous investments in form of procurement, bulk chillers and processing plants (apart from distribution). Having said that the opportunity size is huge and I believe there is space for multiple players to grow and capture the total addressable market.

Using Munger’s Inversion approach, what is the worst that could happen to Prabhat Dairy’s B2C ventures if it were to fail. It could be sold off to other regional players looking to enter Maharashtra such as Hatsun which can use the Prabhat “Goodness Zone” and re-brand it as their Hatsun Daily Franchises (could apply just as well Creamline or other AP brands)

On the other hand, if it turns out to be successful, they could use any surplus cash thrown out by their B2B segment to finance their Sales & Distribution spends. Moreover, since the management has made a guidance to reach 2000 cr, revenue by 2020 with B2C having 50% revenue share, it would be an easy decision to exit if they fail in their execution without any strong external reasons to justify the failure.

Again, very valid and fair point. The past 2 quarters have shown signs of a possible turnaround. Having said that there is a very real chance of this ending up a value trap.

Another point to note is that the logistics landscape has a complete paradigm shift once the Govt’s various programs such as Dedicated Corridors, Sagarmala and others are in place. There is every chance that completely new business models may emerge that have not been thought of as on today. Snowman along with its parent Gateway Distriparks may have some positive impact or just as likely they may be disrupted by a startup and be thrown by the wayside. To be honest, I don’t know how it will turn out which is why I feel this is my weakest position.

Equally one must be wary of the Amazon threat with past rumors of their possible acquisition of Big Basket. There is always a chance Snowman could be affected indirectly. At worst, it could become an acquisition candidate and be played as a special situation.

I am aware of the opportunity cost and not planning to add further. Any further cash will be used either for Prabhat or Thyrocare. If compelling enough maybe a couple of new positions.

These are exciting times. Even if it turns out to be an actual bear market, I would at least have broken my virginity and know what is the stage of my development as an investor.



Hi Vishnu

Good to see you back n good to hear that you succeeded in your challenge to reverse the type2 diabetes.

I wish you good luck! & wish you the hale n healthy life. Take care.

Thanks for the contribution to the VP community.


Great to get update from you. Thanks for initiating thread on your new position.

Thyrocare is somthing I would be interested at lower proper valuaton.
Prabhat and Snowman have very limited understanding to pass any comment.

However, just one suggestion would be increase number of companies to 6-8 at least. This is my opinion and may not be relevant to you. Wish you all the best for future endvours !!!

Hi Vishnu,
I prefer a company which has already proven itself & there is long runway for growth with good management.
Why go for Prabhat when Hatsun is available.
Stock price of Hatsun is not cheap but it comes with excellent management, brand & successful execution skill. Their debt to equity problem would be addressed in current quarter with right issue proceeds.

Thyrocare is a good choice for 5 to 10 years.

Snowman I don’t know much about but I think this company has to prove itself on multiple fronts instead of that why not go for a company with proven track record , it doesn’t matter if you pay a little more for that.

Thanks Dhiraj and Hashim.

Every opinion counts and is very valuable however contrary it may be.

Goal is indeed to settle on a core portfolio of 5-8 positions. However, I have managed to build very high conviction on only these 3 so far which are not overly expensive IMHO.

3 years back, I would have been wary of any of the listed dairy companies given the dominance of Amul and their business model of wafer thin margins.

Now, I believe there is space for niches within the dairy products space which can be capitalized by smaller players.
Btw, Hatsun is on my watchlist. Would not hesitate to buy if it comes down to more reasonable levels. However I prefer Prabhat with its smaller base, proven quality on account of B2B segment and employing a similar playbook to Hatsun which targeted rural areas in its initial years and reasonably valued relative to mgmt’s 2020 revenue guidance.

With respect to Snowman, there may be a scarcity premium possibly associated with it due to it be the only pure play cold chain logistics company.

Cold Chain industry is currently measured by the pallet occupancy metrics which leads to low asset turns as in case of the large potato storage centers which are occupied for months on end and farmers pay the rent for it. If however the focus shifts to throughput of pallets (i.e. flux of goods going in and out of the warehouse - such as Fast Food chains which have quicker inventory turns), it would imply the assets are being sweated better.

It is a hedged bet.
In the next 5-10 years, Snowman can benefit from the increase in consumption of junk foods and fast food chains (Govt is making a push for more food processing which to me will lead to more chronic illnesses while there maybe increase in productivity/efficiency)
Longer term say 15-30 years, when the public abandons fat-free, low-fat and cholesterol-free foods and demand for high saturated fats, Snowman can benefit from the increased focus on frozen meats and dairy products in future (assuming it survives till then, of course)

Above notions may sound preposterous, but that is my “variant perception”:- possibly extreme, but nonetheless mine to bear and defend. I am under no illusion as it is definitely going to take time to reverse the “saturated fat/cholesterol causes heart attack” hypothesis that has been pushed for the last 50 years.


@crazymama your views on prabhat’s latest results ?

Except for the increase in ST Borrowings to handle the Working Capital Needs, I feel the results have been good.

Management in their latest concall explained that the additional funds were needed due to the 2-3 months lag in the INR 5 subsidy payment being provided by state government.

As one can see below, despite the increase in ST Borrowings, they seem to be not utilized given the corresponding increase in “Bank Balances excl. C&CE” line item.

Mgmt continues to take the benefit of low milk prices and increase in gross margins by spending on S&D.

I like the fact that mgmt continues to spend on Bulk Milk Coolers, which should help to increase the density.

Overall, I see that management has been consistent in walking the talk so far.

Disclosure: Have bought more this week since the price dropped.

Portfolio Update:

Avg Buy Price Allocation
Thyrocare 590 28%
Prabhat Dairy 103 21%
Balaji Amines 454 18%
Snowman Logistics 38 15%
Kkalpana Industries 29 2%
NIFTY LEAP Put Option 1%
Cash 15%

Previous Allocation:

Looks more balanced now.

Sold off a bit from each to buy Balaji Amines.

Brief Rationale for Balaji Amines is as follows:

  1. Play on Metformin with India having >65% (by Sales) market share globally and Balaji Amines having highest market share for key intermediate DMA HCL.
  2. Lack of substitutes for DMF.
  3. Capex for BSCL done.


  1. Despite the capex for MIPA (Mono Isopropyl amine) being oppurtunistic due to the anti-dumping duty on it, I feel there is regulatory risk in terms of ban on herbicides like Glyphosate which require MIPA.
  2. Positives of Metformin (a possible longevity drug) is offset by regulatory risk of bans on Agrochemicals (though a low probability event given the entrenched vested interests, just as unlikely as a ban on sugar)

Kkalpana is a medium term play (1-2 years) on deleveraging and possible tailwinds from increased focus on T&D and evacuation infrastructure for RE.

Rationale for Kkalpana is captured in detail here:

Being a big fan of Taleb’s works, I have opted to buy a long dated option as an insurance given the high likelihood of increase in volatility around elections and subsequent drawdowns.

Views Invited.

Looking forward to what looks to be a very exciting 2019!

PS: Intention is to update PF on a half yearly basis.


In my view ,Thyrocare seems to be an overhyped stock .It is too crowded a segment with low-entry barrier and price-undercutting. There’s no moat involved .Again my personal view.

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Thanks for sharing your opinion. Much appreciated.

I agree with all your points. But in my opinion they represent the consensus view held by Mr. Market for the next 2-3 years.

I am more interested in where the puck will be going.rather than where it has been,

My thought process is as below regarding the future (Not forecasting but teasing out the possibilities):

Let us consider a thought experiment of 2 possible alternative worlds:

  1. An empowered consumer-patient who has become disillusioned with the top-down dietary guidelines (based on correlation/association) and decides to self-experiment to figure out how different lifestyle factors (nutrition, exercise, sleep, stress, alcohol) affect him/her. This is where various diagnostic channels will help. It could be Point of care devices like Fitbit, Oura ring (24x7) or monthly/quarterly profiles from vendors like Thyrocare. Most would prefer data-points from different sources to corroborate rather than depend only on one device/medium.
    In this scenario: i think Pathology/Histology + Genomic should benefit.

  2. Or the consumer-patient continues to believe the Govt/experts know what is best for them and continue on the path towards higher proportion of chronic illnesses with various specialists working in silos and looking at diagnostic markers in isolation (such as LDL cholesterol) or focusing on the wrong markers (such as Blood Glucose instead of Insulin and Insulin Resistance related markers). Essentially the diseased/disordered outnumber the healthy despite following the guidelines perfectly.
    In this scenario: PET-CT scans should benefit (Genomic should as well but for the wrong reasons).

I would very much prefer 1st scenario rather than the 2nd one.
But we will end up somewhere in between the above 2 extremes.

Given the sheer weight of numbers in terms of population, Thyrocare and other big diagnostic firms can leverage the huge amount of data they are accumulating currently to look at all the parameters at a holistic level and see if predictive patterns can be discerned. (Possible integration benefits with Goqii ecosystem). Assuming they anonymize the data first.

With respect to Genomic testing, it is a small portion of what can be analysed. There are a lot of other -omics such as Proteomics, Metabolomics, Lipidomics, Transcriptomics (currently limited to research). Genes are ultimately switches to be turned off or on by epigenomic (environment around the gene) factors. It is the change in genomics on account of the epigenome which is far more crucial information.
Given the current cost of performing genomics testing, my current understanding is that it is done just once on request of a doctor or for the purpose of 23andMe profiles. It makes more sense when somebody can perform these tests say on a half-yearly or yearly basis to track the dynamic changes in genome.
As the cost of gene sequencing decreases further, at some point of time Thyrocare may find it feasible and profitable enough to include it in their profiles (all that is needed is a tongue swab to be collected by the phlebotomist)

With respect to pricing and regulation (lack of entry barriers), I can understand why the Govt may not have been active in enforcing regulation on diagnostics. I assume they wanted to encourage sufficient availability/penetration of diagnostic labs before focusing on regulation.
The recent announcement of the National Essential Diagnostics List (NEDL) draft, is IMHO a positive first step towards standardization and more regulation. PMJAY would necessitate the need for proper accreditation/quality of diagnostic labs before they can tap into those insurance payments.

Above is an example of a health insurance firm which have linked health markers to the premiums.
A diabetic maintaining a lower HbA1c pays a lower premium compared to a higher HbA1c patient.

Funnily enough, I have never discussed about any financial metrics because Mr.Market accepts the fact that the balance sheet is of a high quality with sustainable cash flows from B2B and has the capacity to suffer a downturn in terms of increasing competition + price under-cutting at least for the near term (2-3 years). Don’t know if it is anti-fragile. But it is for sure not fragile.

Increase in tighter regulation is bound to start consolidation. Timeline is uncertain. But given that there is currently over supply, we must wait for the inevitable change in cycle and consolidation wave. Question is will Thryocare adapt to acquire or surrender to get acquired? I am betting on the former.

Under a tighter regulation regime, I think Thyrocare’s kitchen sink model can come to the fore and there may be a premium in the eyes of the B2B customers for being associated to Thyrocare’s network.

I would encourage folks to posit opposing views to the hypothesis I have proposed above (Again a reminder that I am not making an attempt to forecast the future)

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Thanks for sharing.

Pleasantly surprised. No intention of reacting to the news flow now.
Will let things settle down before re-evaluating the position.

Continue to hold for now.

So after the sale of dairy business they will build animal nutrition and genetics business which I suppose was a recent announcement as well and current revenue is all from dairy business.

Sudden announcement and difficult to understand the idea behind it. Any inputs from you on their cattle feed business or animal nutrition?

Agree that the announcement looks out of character given the fact that the mgmt were strident about reaching 2000 Crores by 2020.

Anyways, I am not interested in their cattle feed business since I believe that cattle and the milk is more healthier when fed grass/pasture (@ lower yields) rather than grains/cattle feed (@ increasing yields)

Let us wait and see how they intend to deal with the cash received.
Given the fact that more than 40% of the promoter holding is pledged one must be more careful for any signs of mis-allocation.
On the other hand, looking at the tofler company network map, most of the entities related to Nirmal family are related to Milk or Agriculture. In that sense one can be slightly more confident that they intend to continue to focus on dairy-allied sectors given that it is their core competency.

Too early to have a concrete opinion. Let things settle down.

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Hi Vishnu,
With such a wild swing , from almost +25% to -15% at close of market, I am curious to know what was your stand? did you sell off some of it, or still continue with their new line of business idea?

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