Wednesday, July 18, 2007
We had breakfast at College at 8.30 and supposed to start the journey by 9. But Mis-management started there, the Bus took off only by 10.15. At Mumbai, it is very difficult to sit inside the Bus when it is not moving. Totally 130 out of potential 400 turned out for the trip. 4 buses were arranged, our bus had about 20 people with 1 girl. Most of them were sitting at the back seats, singing and shouting. A few us were with different priorities, that of seeing outside. Tarun, Shaleen, Ashutosh and I were sitting in the front rows.
I was sitting with Ashutosh. He is a Mining Engineering Graduate from IT-BHU, worked in Hindustan Zinc for 3 years. He is a silent guy like me. I tried to kick start the conversation by talking something general. It didn't help in continuing the conversation as he replied them with Yes and No. I then asked him about his company, this enthused him and started explaining about it (Hindustan Zinc). I have been following Business news for the last 3-4 years but haven't heard much about it. May be because I don't track much on the metals and commodities space. All I knew was that zinc prices were rising. 5 years back it had profits of 250 crores when it was completely government controlled. Later it got disinvested and Anil Aggarwal led Sterlite took ownership. Now he says it has profits of 4400 crores i.e 1b$ in profits on 2b$ sales, hence 50% margins. Wow, we know so much about Infy, TCS and Wipro even they are yet to reach 1b$ profits. But don't know about this one.
He also told me a few things about him and his batch-mates. Most of them have joined IIMs or have started their own Businesses. I didn't know much about IT-BHU as a top Engineering college. But he said, selection is through IIT-JEE and one needs to get within 1000 to get Computer Science. He himself had a rank of 2700 and got Mining. This makes me feel so proud because my class batch profile is so good. We have average Work-ex of 2 years, mostly Engineers from various disciplines. Most have studied from NITs and other top colleges.
Then Tarun and Shaleen interrupted us, they are very funny, they cracked jokes we laughed heartily. We reached Bandra-Kurla Comlpex (BKC). It was a totally different place than rest of the places I seen so far. So many companies especially Banks have their Head Offices there. To list a few SBI, ICICI, BoB, BoI, NSE, Workhardt, Kotak, ONGC and IOC. This indicates me how developed our Businesses are compared to the rest of the things. The 15 minutes time that the Bus traversed through BKC was time spent at the paradise. After that traffic jam, slum, smell or normalcy restored. There was a brief stop at Hanging Gardens and Kamala Nehru Park. From Kamala Nehru park one could have a panoramic view of Choupatty Beach, Marine Drive, Nariman Point, BSE etc. It was beautiful. Captured a lot of pictures there.
Next stop was at Gate Way of India, on the way we went through HajiAli, Malabar Hills, Marine Drive, Wankhade Stadium and Nariman Point. The guide was explaining us the significance of each of the places. Wankhade stadium to me is one of the unluckiest stadiums along with Chinnaswamy in Bangalore. I can remember India loosing 3 matches in last 5 years to Australia, South Africa and England. Nariman point is another place where top companies have their head offices. Air India being the notable one. Marine Drive is also called Queen's Necklace because at night when seen from top the lights along glitters like necklace. I myself have seen it while I was flying from Mumbai to Bangalore at the time of Admission. So far so good!
After Gateway of India, we went to Nehru Science museum. Now, this is what I simply don't understand. Why are Post Graduate Management students taken to a children science museum? Anyway we were taken there. There we had to wait for half an hour for buying tickets, time is already 3 now. I had not mentioned about lunch so far. That means we are yet to have it and we are extremely hungry and frusrtated. From the ticket counter musuem is a good half a kilometer far. Then we again had to wait for another 45 minutes to gain entry inside the museum where on ground floor lunch was served. The wait outside was so agonising. Even the clouds were not there to save us from angry mid-day sun. Life is all about ups and downs, as was this day. After people were let inside, strength being 130 and only one food counter. There has to be another long wait. By that time I was used to the hunger. Had lunch and went to museum to see school level sound and light displays. Remembered the basic science principles studied 15 years back. Came back to the bus. Wait is not over yet. There was another half an hour wait for everyone to come back. Whatever plans were there for the rest of the day was canceled including the 4D show. I had lost all the energy and enthusiasm. Slept in the bus all the way back and reached back to college and 6.
What a waste of time. That's why I don't enjoy going anywhere with lots of people. I like to go only with a small group of people with same priorities or even alone or with another friend. Hard to find such people as my priorities are so different from others. To me the basic purpose of going somewhere is to see that place. Not for singing, dancing, shouting, drinking or socializing. I like to visit natural places with rivers, forests, hills and valleys. But I don't always have the choice. I end up compromising most of the times inpite of having spent my time, money and effort.
Sunday, July 15, 2007
How important is
Coming to this tour, Sachin Tendulkar and Sreesanth hold the key to
Sachin is looking in ominous touch, scored 2 fluent 90s in ODIs, but the best had been the 171 against English Lions while leading Indian side. It has by far the most belligerent innings in last 5 years. He now has scored 4 centuries in 4 first class games. One in Ranji final against Bengal, two against
Sreesanth but not Kumble will be the key to Indian bowling in
KP is in the best of his form, dream international career so far, scoring 2500 runs in just 25 tests all against quality oppositions, 10 of them against
With Flintoff and Harminson out due to injuries, Monty Panesar will be the main threat to the celebrated strong Indian batting line-up. He is lion hearted, consistently attacking, hardly giving away loose deliveries, mixing up well with his turn and drift. Being a spinner he can bowl long spells, giving little breathing time to the batsmen. He started his test career just 18 months back bowling Sachin for his first wicket at
Indian challenges for this would be
1. Finishing off the tail –
2. Lack of experience – Barring Zaheer Khan we don’t have bowlers with an experience of even 10 tests. Agarkar, Irfan Pathan and Munaf Patel have been left out for good.
3. Defensive 4 bowler strategy – After 3 fast bowlers finish their spells, bulk of the bowling needs to be done by Kumble and a part-time bowler. In Test Cricket wickets don’t come unless there is pressure applied from both ends for sustained period. If we sum-up Indian bowlers’ average wickets per match, they add up to only 14, assuming 1 run-out we can take only 15 wickets, while to win a Test match we need 20 wickets clearly suggesting that we are a bowler short.
4. Opening Combination – Jaffer hasn’t been in the best of form, has never looked comfortable against moving ball. His 4 hundreds have all come in good batting conditions. Karthik isn’t a regular opening batsman.
5. Aging middle order – This has been the strength as far as
1. They last played
2. Injuries to key fast bowlers. Harminson is in doubt for first test. Flintoff is ruled out for the series, he can at best hope for his return during 7 match one-day series. Flintoff’s loss will be significant as they don’t have an all-rounder for replacement. Last time he toured
3. Fast bowling which was has always been their strength is on a decline. Dependence on Panesar is increasing. Against
4. Andrew Strauss has been struggling, scoring only one 50 in last 17 test innings beginning Ashes series. Vaughan who was run-machine last time around with 2 scores in 190s and 600 runs overall may not be as effective with the bat.
I need to be very careful while writing this, because it can be compared to at the end of the series. Any major mismatch from the actual will reduce my reputation as a forecaster, if at all I have any ;-) Sorry to disappoint Indian fans but I predict a 2-0 win for
Friday, July 13, 2007
I can understand that for public listed companies the share holders' interests must be protected. The share holders want growth in the value of stock and dividends. That is possible only by increased profits. Increased profits is possible only by increased sales, cutting costs, improved efficiency, higher market share etc. All investors who are fundamentals oriented not only look for PE ratio, they also include Growth factor and hence PEG ratio i.e the PE in comparable with annual growth. High PE valuation of Pantaloons, Bharti, Infosys, ICICI Bank etc are justified by their similarly high growth rates.
Customers - They will get same products at lower cost or higher quality or wider range of products or better service or any or all of them.
Supplier - When company grows the order volume of supplier increases which is a good thing for him.
Employees - Each self respecting employee wants a growth in his salary, perks and position or at least keep his job. The chances of that happening are more when the company grows. When companies don't grow, employees are the first to face the axe.
Society - People get more jobs and their income and prosperity improves.
So, growth is self-sustaining, at least it seems looking at points above.
But it doesn't always happen and it takes extra-ordinary effort on the part of Management and Employees to sustain growth. We will see why
1) Competition - Along with us there will be other who want to do well, make money by increasing the market share. This results in our market share being eaten. Even though the overall market is growing, if the competitor grows faster than the market and us, we loose out.
2) Economic Recession - In this scenario the consumer demand and spending decreases and them market in which the company operates decreases. Growth and Recession occurs in cycles difference being former is virtuous and latter vicious. There is not much the company can do to solve this problem.
3) Self Destruction - This happen when the people who matter have vested interests, cheat or are even lazy.
India is in a high economic growth path as of now and it is not very difficult for the companies to grow, but interesting thing is how long is this going to continue? I hope it does for a significantly long time as I would like to cash-in on it and settle down without much of a struggle.