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Suggested Reading – October 3, 2009

TIP Guy 4 October 2009 sunday reading No Comments

Blogosphere is an interesting place where you find various bloggers expressing their viewpoints. I am listing some of the articles that I enjoyed reading.

These are some diverse set of articles from fellow bloggers and business magazines. I hope you enjoy reading all or some of these interesting posts.

Gujarat Gas: Waiting for Right Price to Buy

TIP Guy 3 September 2009 analysis 11 Comments

GG logoGujarat Gas Company Ltd. (GUJARATGAS) is India’s largest private sector company in natural gas transmission and distribution. As the name suggests operations are in state of Gujarat. It distributes natural gas to industrial, commercial, and domestic customers. British Gas Group has a majority of the stake of close to 65% stake in the company. Few key aspects that I like about Gujarat Gas are its business model of gas distribution and practically debt free balance sheet.

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 i.e. from 2000 to 2008.

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Number of Stocks in Long Term Portfolio

TIP Guy 13 August 2009 opinion, strategy 18 Comments

portfolio-makeupThere are two questions that will always haunt any long term investor. One is about what is a right asset allocation, and second is how many stocks one needs in a long term portfolio. I do not think there is any boiler plate type of answer to these questions. I believe while it is absolutely necessary to have an optimum asset allocation and multiple number of stocks, the actual percentage allocation or number of stocks will depend upon individuals risk profile, willing to learn, willing to spend time reading about companies, etc. In addition, these two aspects cannot be generalized and it cannot be a static numbers. These have to be dynamic and should change with the investing time period. Having said that following is my thought process for my long term portfolio.

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Value of Dividends – A commentary on Article by Krishna Kant of ET Bureau

TIP Guy 22 July 2009 commentary 3 Comments

On this blog, I continue discussing about my thoughts about dividend investing using value approach. My interest in dividend investing is driven by my objective of generating increasing cash flow (coupled with long term capital appreciation).

Recently, there was a very good article in the context of disinvestment of PSUs. The author, Krishna Kant, presented a very good perspective about significance of dividends from PSUs and its implications on government’s fiscal needs. I am discussing few take ways from that article:

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S&P Pan Asia Dividend Aristocrats

TIP Guy 5 July 2009 commentary, education No Comments

Standard & Poor’s is a US based provider of financial market intelligence which includes ratings, investment research, risk evaluation and data, and various types of indices. Among multiple different indices with different focus areas, one index is the dividend aristocrat index.

The Dividend Aristocrats is an index which consists of S&P500 companies that have been raising dividends continuously for 25 years or more. That is, every year, the dividend per share keeps on increasing. If any company that reduces or cuts the dividend in any given year, it is removed from the index. Now this is the characteristics that can be viewed in multiple ways, but TIPBlog is about Indian investments. Therefore, I will not go into detailed discussion. But it gives the context for this posts further discussion.

In markets of Asia or other parts of the world, it has been difficult to find a single company that has consistently raised their dividends year after year. Outside United States, there has been lack of consistency in the way the corporate’s managed dividend strategy, or the way the government policies taxed dividends to companies and common shareholders.

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Royal Orchid: Stock Analysis for Long Term Investment

TIP Guy 3 June 2009 analysis, stocks 8 Comments

royal-orchid-logoRoyal Orchid Hotels Ltd. (Orchid) operates a chain of business hotels in India. It has a mix of businesses all concentrated in hospitality industry. It owns hotels assets, has interest in associate companies driven by branding, and contract management of third party hotels. It has 24 associated subsidiaries within the corporate structure.


Orchid had been on my list for further evaluation for quite sometime, but I never felt excited about the company. Recently, one of my readers (Sumi) left a comment requesting my views on this company, more so because it seems to be paying impressive dividends. My objective in this analysis to see if Orchid is a good fit for my portfolio (and hopefully it will also take care of my reader’s request).

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 i.e. from 2000 to 2008.

Continue reading rest of this article…

Eight Companies Confident to Raise Dividends for Shareholders

TIP Guy 24 May 2009 dividends 5 Comments

There are quite a few companies that are confident in their cash flow and profitability that they are sharing increased dividends with their shareholders. I believe this shows management’s confidence in their business prospects going into next financial year. There are many companies, but for now, below is the shortlist of eight companies for this week.

  • Visaka Industries Ltd. [2009, Rs 4.00, +33%] [2008, Rs 3.00]
  • ADF Foods Ltd. [2009, Rs 1.50 +50%] [2008, Rs 1.00]
  • Tilak Nagar Industries. [2009, Rs 2.50, +19%] [2008, Rs 2.10]
  • Keltech Energies Ltd. [2009, Rs 2.50, +100%] [2008, Rs 0.00]
  • J. K. Paper Ltd. [2009, Rs 1.75, +16%] [2008, Rs 1.50]
  • Joyti Structures Ltd. [2009, Rs 0.90, +12%] [2008, Rs 0.80]
  • Triton Valves Ltd. [2009, Rs 15.00, +20%] [2008, Rs 12.50]
  • ICI India [2009, Rs 16.00, +100%] [2008 Rs 8.00]


Below is the shortlist of companies that continue to keep their dividends flat (i.e. they have neither increased nor decreased compared to last year).

  • Everest Kanto Cylinder Ltd. [2009, Rs 1.20, flat] [2008, Rs 1.20]
  • Voltamp Transformers Ltd. [2009, Rs 12.50, flat] [2008, Rs 12.50]
  • Blue Star Ltd. [2009, Rs 7.00, flat] [2008, Rs 7.00]
  • Ajanta Pharma. [2009, Rs 2.50, flat] [2008, Rs 2.50]
  • Chambal Fertilizer. [2009, Rs 1.80, flat] [2008, Rs 1.80]
  • Zuari Industries. [2009, Rs 3.00, flat] [2008, Rs 3.00]
  • Diamines and Chemicals Ltd. [2009, Rs 1.00, flat] [2008, Rs 1.00]


Below is the list of companies that reduced their dividends. As a long term dividend (or income) investor, I would be concerned of these dividend cutters.

  • MRO Tek Ltd. [2009, Rs 1.00, -66%], [2008, Rs 3.00]
  • Bank of Maharashtra Ltd. [2009, Rs 1.50, -25%] [2008, Rs 2.00]
  • Oriental Hotels Ltd. [2009, Rs 9.00, -14%] [2008, Rs 10.50]
  • MM Forgings Ltd. [2009, Rs 1.50, -70%] [2008, Rs 5.00]
  • Ashok Leyland Ltd. [2009, Rs 1.00, -33%] [2008, Rs 1.50]


I will continue to provide similar updates every week. My end goal is to prepare a list of stocks that consistently grow dividends. We will see how this makes progress.


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