Vishal Khandelwal

What to do with Opto Circuits?

I’ve received a lot of emails over the past few days on my report on Opto Circuits (OCIL) and my “latest view” on the stock in light of its continuous fall – now down almost 11% from my intrinsic value of Rs 130.

Some people have also sent me hate mails asking why I researched and reported on a dud company like OCIL that is facing the “biggest problems faced by any company in the world”.

One reader also blamed me saying – “In my opinion you have just had a look at the presentations on the website of the company and not put your mind on the bigger picture.”

One reaction I can have on such emails is to rue my luck and curse myself for reporting on OCIL.

“How could you touch such a company?” the “expert analyst” inside me is itching to say.

The Best Advice I Ever Got

While doing my MBA during 2001-03, I was a very energetic guy…like most MBAs usually are.

So whether it was completing my assignments on time, making clean presentations, participating in extra-curricular activities, and spending time studying for the exams…I was full of energy and drive to do something in life…

…something that earns me a good name and money, and that can make my parents proud.

This is usually the dream that a small town boy harbours while working hard to achieve his goals of a good education, and then a good career. In that way, I was no different.

So I was energetic, and also thought that I possessed a reasonable amount of intelligence to achieve whatever I wanted to achieve in life.

It was here that I came across this snippet from a lecture that Warren Buffett gave at the University of Florida School of Business in 1998.

I had no idea about Warren Buffett then, except that he was one of the richest men in the world. And in following my dreams of a nice career with a nice starting salary, I was excited to read something that a ‘rich man’ said.

Revealed: The Most Awesome and “Undervalued” Resource on Safal Niveshak

Image Source: Ploomy.com

Last night, I was looking at my Google Analytics account for Safal Niveshak. This is a tool that helps me know, for instance, which are the most and least visited pages on the website.

I was tracking the visits for the past one month, and something struck my eyes.

While my open letter to my daughter and Prof. Sanjay Bakshi’s interview topped the charts in terms of the number of visits, what lay low was a page that I consider as the “most awesome resource” on the entire Safal Niveshak website.

The page I’m talking about is the…

Value Investing, the Sanjay Bakshi Way – Part 4

Here’s the final part of my interview of Prof. Sanjay Bakshi. You can read the first three parts here – Part 1 | Part 2 | Part 3

Safal Niveshak: Can you draw down a series of steps and checklists – the process – you use to identify stocks to buy using the value investing route?

Prof. Bakshi: You need different checklists for different styles of investing.

If you are analysing a bankruptcy situation, the checklist you will use will obviously be different from the one when you are buying into a business on the basis of the skills of one person, like Ajay Piramal.

Buying into Piramal Healthcare was essentially a bet on the man’s ability to allocate capital. So to evaluate how likely he will do that in the future, your checklist must first examine how well he allocated capital in the past and also how did he treat his minority investors in the past.

Safal Niveshak’s “Secret” Mission and Progress

A friend recently asked me, “You’ve always talked about Safal Niveshak as a cause, right?”

“Indeed, it’s a cause to help small investors become independent and successful in their financial lives.” I replied. “But why did you ask that?”

“I was just going through your Investing Workshop page, and saw that you have priced your Workshops at Rs 5,000 at the higher end! Isn’t that expensive for a small investor? Doesn’t this also dilute the entire concept of this being a cause?”

“Well, I don’t have any statistic to prove how much a small investor can afford to invest in himself/herself by learning the art of investing,” I told him, “But I anyways expect people to pay based on the benefit they think they receive.”

“So have you had people who’ve paid you nothing?” he asked out of curiosity.

Bharti Airtel: What Am I Doing with the Stock?

First a disclosure – I own Bharti Airtel in my portfolio, as I’d disclosed via a post in March.

I had bought the stock in October 2009, at an average price of Rs 301. Given the fall the stock has seen over the past few months, which has been compounded by continuous weak results from the company, my investment is down almost 13%.

So what’s my next course of action with respect to the stock?

Value Investing, the Sanjay Bakshi Way – Part 3

Here’s the third and penultimate part of my interview of Prof. Sanjay Bakshi. You can read the first two parts here – Part 1 | Part 2

Safal Niveshak: How can a small investor build up a “positive loop” that you talk about to increase his circle of competence, given the time, education or background constraints? How did you do this when you started out as a small investor yourself?

Prof. Bakshi: Buffett talks a lot about the idea of “circle of competence”. But what do we mean by the term?

I like to define it in a creative manner. Most of my students are engineers and have little or no accounting background. One way to think about circle of competence for them is to only specialise in engineering stocks. And students who are specialising in marketing may develop their circle of competence in FMCG stocks.

Creativity in defining your “circle of competence”
That’s the conventional way of thinking about circle of competence. There are other ways. For example, you may specialise in micro-caps. Some of my students are doing exactly that. They have no interest whatsoever in large cap stocks.

Safal Niveshak StockTalk #9: BHEL

Welcome to the ninth issue of Safal Niveshak StockTalk. (Download PDF Report)

After covering Opto Circuits last time, this time I’ve researched on BHEL, India’s largest manufacturer of power generation equipments. Before we dive deeper into BHEL, here is a brief overview of the sections of this report.

About BHEL
Safal Niveshak’s 20-Point Checklist
Intrinsic Value Assumptions
Risk Statement (New Section)
Financial & Market Snapshot
“Should I Buy BHEL?” Checklist
Final Evaluation Checklist (New Section)

Value Investing, the Sanjay Bakshi Way – Part 2

First the bad news! The post below is still not the complete interview with Prof. Bakshi, as his answers, to my late realization, were more extensive than I think I’d heard (might be due to me having lost in the aura of meeting him). 🙂

So you will still have to wait for at least two more parts to get the complete transcript of the interview.

Now for the good news! The next 4,000 words are going to bring you great enlightenment in investing and human behaviour.

As I type, and type, and type the interview, I am getting newer ideas with each paragraph. And I hope the same for you as you read, and read, and read what’s written below.

So over to my second question of the interview with Prof. Sanjay Bakshi, and his answer to the same.

Value Investing, the Sanjay Bakshi Way – Part 1

I recently had the privilege of meeting one of the highly regarded professors in the field of value investing and behavioral finance, Prof. Sanjay Bakshi in New Delhi.

Safal Niveshak meets Prof. Sanjay Bakshi

Prof. Bakshi teaches MBA students (at MDI Gurgaon) two popular courses: “Behavioral Finance & Business Valuation” and “Financial Shenanigans & Governance”.

He is also the CEO of Tactica Capital Management, a boutique firm engaged in deep value investing.

It was like a dream come true for me, having met a guru who has been a great teacher in my investing pursuits over the past few years. So it was obvious for me to wait for Prof. Bakshi’s arrival with butterflies in my stomach.