Saturday, May 16, 2015

Total Market Cap to GDP: Does the 1x hold for India too?

Total market cap to GDP at the end of April 2015 stood at around 84%. Still below the buffet statement of 1 times total market cap to GDP. At the end of Feb 2015 it went up to 89%.

A graph of the Market cap to GDP is here:

The question I am trying answer is whether the 1 times total market cap to GDP holds true in the case of India. The private to public paid up capital ratio is 36:64. This very surprising to me because I thought the majority would not be listed in India. Also paid up capital does not include retained earnings and this factor could very well be off the mark but its a start.

Tuesday, May 12, 2015

Dewan Housing Finance (DHFL) - Used to be cheap and probably still decent quality

My notes on DHFL - Dewan Housing Finance Limited from Feb-Mar-Apr 2014. The company continues to have some good shareholders like Rakesh Jhunjhunwala and the government of singapore. The LTV is falling and the NPAs are up a bit but not very much. The company still claims they have excess provisioning. I wonder why Mr. Market has been reducing his bid on the stock all the way from 552 to 431. 

Disclosure: I am long.


Value Canvas

Sunday, May 10, 2015

Do FII flows drive market returns?

FII flows are the drivers of the Indian market as we have learnt in the institutional derby article. Just to refresh the numbers, total institutional flows are about 80% of the market volume. Of this 3/4ths is FII flows. This made me wonder how well the index return and the FII flows would be correlated with each other. Thus about 60% of the market volume is being controlled by foreign institutional investors. From January 2002 net FII flows into the country have been 122 Bil USD - Which is over 5% of the current GDP!

The following chart sums this up:

Thursday, May 7, 2015

ValueQuest India Moat Fund Portfolio

Unfortunately only I have been able to find only 2 stocks where it is confirmed that the ValueQuest India Moat Fund (VQIMF) run by professor Bakshi is invested. They could be invested in a universe of over 4000 other companies and I am going to make an attempt to figure out which companies those are.

Some assumptions I am going to make

  • The fund is unlikely to engage in short term trading and will not sell a position for at least a year
  • The internet will find out about Prof. Bakshi's positions a few months after he probably starts taking the position
  • The data given on trust net offshore ( about the NAV of ValueQuest India Moat fund is correct
  • The Quarter end shareholding number change report is bought at the average of the closing prices on the quarter
  • The stocks that do not show VQIMF as a holder cannot be held by VQIMF more than 0.99%. I am assuming that the fund does not hold any equity swaps and always holds direct equity.
The aforementioned assumptions may or may not be true but in order to figure out what the portfolio holds I have to do this.

The following are the stocks I could find by googling Prof. Bakshi's positions and the earliest date I can find online talking about that stock.

Company Earliest Date
Eicher Motors 19-Oct-08
NESCO 12-Aug-12
Ashiana Housing 7-Dec-12
Thomas Cook 1-Dec-13
Symphony 1-Jan-14
Relaxo Footwears 18-Mar-14
Kitex 12-Aug-14
Poddar Developers 5-Oct-14
Ambika Cotton Mills 1-Jan-15
Vaibhav Global 27-Jan-15

Tuesday, May 5, 2015

ValueQuest India Moat Fund: Prof. Sanjay Bakshi's fund

We all trying to practice value investing are always trying to follow Professor Sanjay Bakshi and his blog. I was googling around to figure out his current portfolio and I came across a fact sheet for the fund at Trust Net Offshore. The data on the site say that, as expected, professor Bakshi had outperformed the market by a very large percentage. The fund is a USD denominated fund domiciled in Mauritius. Launch date is stated as 3 Apr 2014. ISIN is stated as MU0449S00019.

This data is not confirmed and has been taken from The INR return is basically derived from the USD return graph and from FX rates online.

Unfortunately I have been unable to find the portfolio of the fund anywhere. I will attempt to take a shot at what the fund might own by reading the Fundoo Professor blog and making a list of the companies that professor Sanjay Bakshi talks about.