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Visaka Industries – Fairly Priced for Long Term Prospects

TIP Guy 4 October 2010 analysis 31 Comments

Visaka Industries Limited (VISAKAIND) is a Hyderabad based company engaged in two businesses viz., Building Products and Textile Synthetic Yarn. Building products include cement asbestos, accessories, non-asbestos flat sheets – used in roofing material and interiors, V board panel made from cellulose fiber and inorganic silica binders. Textile Synthetic Yarn products include blends of polyester, viscose and related material sets – used in weaving of fabric. These yarn products are used in manufacture of shirting, suiting, fashion fabrics, upholstery and embroidery laces. Recently, Visaka has also entered in power generation, but it is not expected to have any impact on results for another few years.


Trend Analysis

The whole reason for any business to exist is to generate sales revenue and make more profits. At a minimum, the parameters listed below should have continuously increasing trends. All the data below is from 2001 onwards. Continue reading rest of this article…

TIPBlog Portfolio Update: 1H 2010

TIP Guy 11 June 2010 process, strategy 20 Comments

UpdateThe 1H2010 can be summarized as return of optimism, in economy, in stock markets, stabilization of global economy, and fears about euro zone. As an individual investor, should I care about macro economics, or should I even worry about what happens to Greece or to euro currency? Ambani brothers patch up and there are stories its good for markets and business! To me, being stalwarts in India Business world, instead of setting an example, it was idiotic for them to even fight and drag each other into courts. These are good academic discussion, but I doubt it is going to help in your own portfolio. I am taking stock of my portfolio.

My last progress update was for year end 2009. This post summarizes TIPBlog portfolio update and measures progress for 1H 2010. Continue reading rest of this article…

Hawkins Cooker: Stock for Long Term Investment

TIP Guy 20 October 2009 analysis 14 Comments

hawkins logoHawkins Cooker Limited (HAWKINCOOK) is India’s second largest company engaged in pressure cookers and cookwares. The produces a wide range of other house hold and commercial cooking utensils. Its brands include Hawkins, Futura, and Miss Mary.

The key aspects that I like about Hawkins is sells in domestic markets (does not depend upon what happens internationally), low debt, and focus of controlled growth. It is well positioned to cash on growth in disposable income from growing Indian middle class.

Continue reading rest of this article…

Pidilite: Dividend Stock for Long Term Investment

TIP Guy 28 April 2009 analysis 24 Comments

pidilitePidilite Industries Ltd. Limited (Pidilite) is a consumer and specialties chemicals company. Its product range includes adhesives and sealants, construction and paint chemicals, automotive chemicals, art materials, industrial adhesives, industrial and textile resins, and organic pigments. It has several market leading brands that include Fevicol, cyclo, Sargent Art, hobby ideas, Dr. Fixit, ROFF, and m-seal. Two thirds of company’s revenue comes from India’s internal market. Historically, the company has developed most of its product thought a very strong in-house development program. However, in recent years, it has embarked expanding this reach by overseas acquisition and setting up overseas manufacturing units.

Trend Analysis

The whole reason for any business to exist is to generate sales revenue and make more profits. At a minimum, the parameters listed below should have continuously increasing trends. All the data below is based on last 8 years 2000 to 2008.

  • Revenue: Increasing trend with average growth of 18% (SDev. 7%).
  • Earnings per share: Increasing trend with average growth of 20% (SDev. 18%). This shows very high year-over-year variability.
  • Net cash flow from operations: Overall, the net cash flow from operations has an increasing trend. For most part, the net cash flow has been very close to the reported net profit. However, since 2007, it is less than reported net profits. Not a good observation.
  • Profit/Loss from operations: Looking at standalone profits only, the corporation is showing consistently increasing profits from its operations. Good observation.
  • Reported net profit: Increasing trend. Good observation
  • Gross margins: A slow downward trend on gross margins. 2008 gross margins lower than historical average of 16.5% (narrow stdev. of 1.36%). Still not an alarmingly low level. Neutral observation.
  • Operating margins: Operating margins in-line with historical average. Neutral observation.

Continue reading rest of this article…



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