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basant
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   Posted: 24/Dec/2006 at 8:02am |
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5 years in hindsight is very different from 5 years forward!It is difficult to take things that far especially with emerging companies. Just look at 2 years down and see whether the company makes sense other things will fall into place.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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BubbleVision
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Posted: 24/Dec/2006 at 11:23am |
5 years in hindsight is very different from 5 years forward!
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Really BasantJi....that is why i am really confused why MOST gives an award to the wealth creators of the past...rather than try to identify stocks which could be wealth creators.
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You can't make money if you are unwilling to lose...It's like willing to breathe in but not willing to breathe out. -- ED SEYKOTA ....Read Disclaimer!
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basant
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Posted: 24/Dec/2006 at 11:41am |
Originally posted by BubbleVision
5 years in hindsight is very different from 5 years forward!
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Really BasantJi....that is why i am really confused why MOST gives an award to the wealth creators of the past...rather than try to identify stocks which could be wealth creators. |
Absolutely. I have always thought that this is a publicity stunt an event to get some media and investor attention. I mean how am I affectred except academically whether Wipro has created wealth 10 times over or 1000 times over. WIth due regard to Ramdeo (baba) these events are more of data collection rather then an exhibition of analystical skills.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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BubbleVision
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Posted: 24/Dec/2006 at 11:54am |
That is Publicity "Ramdeo and Moti baba - istyle"....
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You can't make money if you are unwilling to lose...It's like willing to breathe in but not willing to breathe out. -- ED SEYKOTA ....Read Disclaimer!
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omshivaya
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Joined: 06/Sep/2006
Location: India
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Posts: 5966
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Posted: 25/Dec/2006 at 12:15pm |
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Thank you very much Basant ji for the revelations and you too Bubble ji. And Prashant ji, still long way for me to go. Nucleus and Educomp can fall as easily as they went up...my focus is still on the next 2-3 years on these...will know whether they ROCK then or not.
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The most important quality for an investor is temperament,not intellect.A temperament that neither derives great pleasure from being with the crowd nor against it
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India_Bull
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Joined: 19/Sep/2006
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Posted: 28/Dec/2006 at 11:25pm |
Basantji and boardmembers,
Champagne Indage is a fastest growing wine company and looks a good long term bet (though I am not sure about the quality of Indian wine as I have not tested Indian wine  so far..) with a good growth potential and very few entry barriers ..Have this been discussed before or has anyone tried to analysis? Basantji what are your views ? Can we have this in our multibag list?
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India_Bull forever Bull !
www.kapilcomedynights.com
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kulman
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Joined: 02/Sep/2006
Location: India
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Posts: 9319
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Posted: 10/Jan/2007 at 7:25pm |
Here is some interesting reading (courtesy: MoneyLife). Given below are excerpts, pleae click on the link for full text.
|
Company |
TSR Rank |
TSR (%) |
Mkt Cap in1996 |
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Unitech |
1 |
34196% |
73.74 |
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Matrix Laboratories |
2 |
29910% |
3.16 |
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Phoenix Mills |
3 |
28935% |
5.26 |
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Donear Industries |
4 |
28533% |
3.96 |
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Vimta Labs |
5 |
27799% |
1.16 |
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Pantaloon Retail |
6 |
20412% |
3.55 |
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Infosys Technologies |
7 |
19583% |
751.82 |
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Mercator Lines |
8 |
19545% |
3.84 |
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Wipro |
9 |
17319% |
580.89 |
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Patel Engineering |
10 |
17075% |
7.45 |
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Satyam Computers |
11 |
16942% |
137.80 |
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Financial Technologies |
12 |
16342% |
2.73 |
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Havells India |
13 |
15928% |
7.22 |
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Lakshmi Energy & Foods |
14 |
12586% |
6.01 |
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Arrow Webtex |
15 |
12281% |
2.62 |
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Panoramic Universal |
16 |
11587% |
0.88 |
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Prime Prop. Devp. Corpn. |
17 |
11518% |
0.94 |
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Aban Offshore |
18 |
10592% |
32.49 |
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Amtek Auto |
19 |
10590% |
10.62 |
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Jetking Infotrain |
20 |
9557% |
0.50 |
If you are in the middle of a crazy a bull run, you are likely to get the most unlikely names as wealth creators
The sheer force of speculation has pushed low-profile companies high up in the wealth-creators' list.
Often, companies and sectors, which do very well for a few years, stagnate in the following years.
Indeed, in every bull market, one or two sectors do extremely well where even garbage floats to the top.
Since value is a function of performance and perception, a slight change in either is enough to cause prices to tumble.
Over 10 years, the Sensex had gained 347%.
Raising shareholder value is like mountaineering. To remain even a modest value creator you have to keep climbing.
As you go higher, it gets tougher to climb the same distance.
To use another common metaphor, value creation is like being on a treadmill. You have to keep running (growing) to stay where you are (to maintain value).
Most people find it hard to understand that that for mature and large companies, even if 'performance is good', shareholder value may not keep rising
Also, in a growing economy like India's, new sectors emerge, attracting smart capital and investment interest. Since the fastest growth is from the smallest base and there is always a fancy for new companies, investors like to bet on companies that are at the base of the mountain.
How does one measure wealth creation or shareholder value? This is a basic question and the answer is simple -- it is whatever a shareholder gets out of being invested in a company over a certain period. That means the difference in market price between two periods (adjusted for splits and bonuses) plus dividends. This is called total shareholder returns (TSR).
Elephants Can't Dance
Market cap has nothing to do with value creation
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Company |
Mkt Cap in1996 |
TSR (%) |
TSR Rank |
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ONGC |
29,301.43 |
614% |
438 |
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IOC |
24,514.98 |
245% |
758 |
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HLL |
15,538.42 |
252% |
750 |
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MTNL |
15,343.35 |
-27% |
1367 |
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SBI |
14,717.86 |
259% |
735 |
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Reliance |
12,077.68 |
821% |
333 |
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I T C |
9,458.98 |
940% |
288 |
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Tata Motors |
9,213.26 |
148% |
948 |
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VSNL |
9,064.01 |
166% |
916 |
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SAIL |
8,588.96 |
302% |
694 |
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Life can only be understood backwards—but it must be lived forwards
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basant
Admin Group
Joined: 01/Jan/2006
Location: India
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Posts: 18403
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Posted: 10/Jan/2007 at 7:36pm |
My Observations:
The best in the lot ONGC had a CAGR of only 20% while wealth increased 6.5 times. So the concept that elephants cannot dance should be taken with that perspective that the maximum wealth that can be created is 20% CAGR while in case of a small cap Unitech (freak buy if only someone could do it) was only 80% CAGR which made a 340 bagger on the stock. Though I have not checked it most of these gains would have been in the last 3 years.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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