Insider Sentiments – 5 of 2016

Dr. Reddy’s Laboratories Ltd Dr. Reddy’s Laboratories Limited (DRL) was founded in 1984 and is India’s second-largest maker of generic pharmaceuticals. While discussing their plans, the Promoters vision of DRL  in ten years is that of a global company that thrives on innovation. Indian Pharma Industry The Indian pharmaceutical industry ranks third in volume and thirteenth in value across the globe. The market size is estimated at R. 2,52,000 crore in the current calendar year (2016). It is estimated that […]

Why is India Underperforming the Emerging Markets Rally?

(Cartoonist: Schwadron, Harley; cartoonstock.com)(Sunday, 11 September 2016) Emerging Markets (EM’s) have been moving higher since February 2016. Before I get into the performance of the Indian Stock Market, the question is how long can EM’s continue to rally. Does the rally in Emerging Markets have Legs? While trying to guess market direction in the EM world, one does need to remember that what happens in EM’s is a function of what happens to global stock markets. The decoupling rhetoric is trash. In other […]

Stock Buybacks: The Good, The Bad and The Ugly

(Cartoonist: Mark Lynch; jantoo.com) (Sunday, 28 August 2016) Stock buybacks or repurchases by companies of their floating stock is a relatively new concept in the Indian Stock Market. Of late buybacks seem to be gaining traction. Types of Buybacks When and how can Indian Corporates buyback their shares? The Securities and Exchanges Board of India (SEBI) has issued guidelines for governing buyback of shares by Indian Corporates. Broadly, there are two types of buybacks: From the existing security holders on […]

Insider Sentiments – 4 of 2016

Nitta Gelatin India Limited Nitta Gelatin India Limited is jointly promoted by Kerala State Industrial Development Corporation (they hold 28,62,220) shares and Nitta Gelatin Inc, Japan (they hold 39,00,300) shares. Effectively, the Promoters jointly own 74.48 percent of the total share capital. The shares have a face value of Rs. 10 and the market capitalisation at the current market price of Rs. 188.85 is roughly Rs. 171 crores. The shares are listed only on The Bombay Stock Exchange, and the […]

Can Expense Ratios Predict Mutual Fund Performance?

(Cartoonist: Mike Shapiro; cartoonstock.com) (Sunday, 14 August 2016) Mutual Funds are now the preferred vehicles for investing in the Indian Stock Market. Can Expense Ratios predict future performance of any given Mutual Fund Scheme? What are Expense Ratios? Expense Ratios refer to the annual fee that all Mutual Fund Schemes charge their shareholders. Expense Ratios are expressed as a percentage of the Assets Under Management (AUM) of the concerned scheme. The calculation is pretty simple. In India, Asset Management Companies […]

PE Ratios: Is it Too Late to Buy Stocks?

(Cartoonist:Karsten Schley; cartoonstock.com) (Saturday, 30 July 2016) The sharp run up in the benchmark indices, post-Brexit, has left investors wondering whether it is too late to join the rally. In such a situation, more often than not, one looks at the Price to Earning (PE) multiple in an attempt to get a ‘handle’ on current valuations. For the uninitiated, the PE ratio is computed by dividing the current market price by the latest earnings per share of any given company. […]

Insider Recommendations – 3 of 2016

Gulf Oil Corporation Limited  Gulf Oil Lubricants India Ltd (GOLIL) and GOCL Corporation Limited are two listed entities that formed part of the erstwhile Gulf Oil Corporation Ltd (GOCL). It has been almost two years since the two entities are trading on Indian bourses. The companies are promoted by the Hinduja group. The Promoter group has been increasing their stake in both the entities since the date of  their separate listings. The idea behind the demerger was to create a […]

Is an RBI Interest Rate Cut Imminent?

(Cartoonist: David Brown; cartoonstock.com) (Sunday, 17 July 2016) An RBI interest rate cut is always considered as bullish. It is a signal that inflation readings are favourable, and the economy is moving in the right direction. The 10 Year GOI Bond The 10 Year Government of India Bond (10 Year GOI) is a sovereign Bond issued by the Indian Government, denominated in Indian Rupees (INR) and represents government debt. Sovereign Bonds are those that are issued by governments. Just as […]

INSIDER RECOMMENDATIONS – 2 OF 2016

OnMobile Global Limited (NSE: ONMOBILE, BSE: 532944), current market price (CMP) Rs. 105.40 is in the business of providing end-to-end solutions for network operators, media companies, and consumers. The company operates in the telecom space and provides value-added services. It is headquartered in Bangalore, India and services customers in 59 countries. Their end customer is the smartphone user. Shareholding Pattern & Recent Changes The promoters of the company, OnMobile Systems Inc, have been continuously buying back shares from the open […]

Are India’s PSE’s Worth a Punt?

(Cartoonist: Baloo-Rex-May; cartoonstock.com)(Sunday, 3 July 2016) As part of the announcements made at the time of presentation of the Union Budget in February 2016, the Finance Minister announced a comprehensive investment strategy for India’s Public Sector Enterprises (PSE’s). The government has since followed up on this initiative.  Are India’s PSE’s a safe bet? Before I get into the meat of things, I think it is necessary to clarify the following: While taking an investment decision, I have always been of the […]