Views on Life & on Equity Investing

Wonder, Wealth & Abundance

On success in any endeavour

with 12 comments

This will be an abstact post not directly related to a stock idea.
I had stumbled on a quotation by a Mumbai based investor, Chandrkant Sampat, which looked like “Only thing an investor needs to be successful is to dream”. I could not relate and agree with it. Must have been clear as whistle in respected thinkers mind, but did not stike a cord with me. It seemed over simpification. Nevertheless it struck and stayed with me that I do not concur with this quotation. Afterall, day dreaming does not amount to success.
Analogous situation happens with other folks who arrive at any adroit art with mastery but forget the means and unable to explain complete process. Patanjali had to think and trace back for yonks to explain how he arrived at that mental state before he could pen down Yoga Sutras. Once an ace hitter reaches wizardry in performance, he forgets the circuitous means by which ability was accomplished, art form is expressed effortlessly as breathing or walking.
Recently another quotation I chanced on by Einstein, was completion for the one that I read few months back “Imagination is more important than knowledge”. I believe this one is more complete. He also opines that he is not necessarily more scholarly, gifted, sharp or genius, he simply dwells on the problems longer.
I believe dwelling on the issues, asking right questions, ticking off checklist like Pabrai and then pulling the trigger makes for good investing.
Also, investors do not change their styles. Once discipline to avoid scores of bad stock ideas, patience to wait for right idea and judgment of a prospective idea is established, investors do not change their styles overnight. A gradual transition is likely. Patient value investors stay like that, growth seeking investors act differently, traders perform same tricks as work in past. Unlike chameleon institutions which pull out new rabbits from the hat, are best expressed by Groucho Marx, “These are my principles, if you don’t like them, I have others”.
——————————————————————————————–
Update on Positions

Hold on Relaxo Footwear
If one has significant part of net worth in stocks, this would be good time to park 30% in FDs.

Written by amitdipsite

September 9, 2010 at 9:23 am

Posted in Uncategorized

12 Responses

Subscribe to comments with RSS.

  1. Sir,
    Did you spot any new multibaggers. If yes kindly share.

    Anonymous

    September 9, 2010 at 1:38 pm

  2. Hi Anonymous,

    I want to ride existing ones. There are few ideas I am investigating but wants existing ones to perform first. Ofcourse, sequence might not play out the way I expect. So far, no new positions taken.

    Regards

    Amit

    Multibagger

    September 9, 2010 at 8:34 pm

  3. Hi Amit,

    I found one commodity scrip…which was relisted in Aug 10 after a long time.
    The company name is 'Orissa Minderal Development Corporation'.
    This company is the largest iron ore mining company.
    Highest Dividend of Rs. 455 / Share on paid up Rs. 10 stock @ 4550% for Year Ended March 2009.
    Expected Current Earning /Share (EPS) of Rs 3000 Per Share on an equity base of 6 lac shares.
    Soon going to be given Navaratha status.
    The nearest comparable company is NMDC.

    Let me know your thoughts on this…….found it little interesting after having a view at thier balance sheet.

    Regards,
    Vikas

    Vikas

    September 10, 2010 at 12:50 am

  4. Hey Vikas,

    Can you please email me PDF of annual report if you have ? I know nothing on this sector as yet, have not applied my mind.

    You have become a hawk !

    Regards

    Amit

    Multibagger

    September 10, 2010 at 2:01 am

  5. Vikas,

    The next big bubble may be agri farmlands with self irrigated water supply and not monsoon dependent. Let me know if you find such opportunities.

    Regards

    Amit

    Multibagger

    September 10, 2010 at 2:17 am

  6. Hi Vikas,

    Had a brief look at OMDC, Margin of Safety exists, its for value investors. Unable to say, multibagger or not, but you wont lose your money over time.

    Regards

    Amit

    Multibagger

    September 10, 2010 at 3:52 am

  7. Hi Amit,

    I will give you a brief analysis on OMDC.
    It has 6 mining licenses in Orrisa…..but last year due to some dispute with Orrisa Gov. 3 of their mining license didn't get renewed which got expired.
    If you look at 2009-2010 annual report balance sheet….that clearly reflects on their performance.
    But now Mr Chandra was quoted saying that all their disputes with Orrisa Gov has sorted out and they will soon start mining in those 3 mines.
    He was said that the current fiscal yr revenue shld be in tune to 300 cr compared to last fiscal yr 09-10 , 155 cr.

    It has 200 million tonnes iron ore which means
    200 x 10,00000 (1 million)=2000,00000 tonne iron ore
    1 tonne Iron Ore cost USD 125
    Total Value of Iron Ore:
    USD 125 X 2000,00000= USD 2500,000,0000

    1 USD = Rs 45
    45 X USD 2500,000,0000= Rs 11250,0000,0000
    Rs 1.12 Lac Crore

    Same way Maganese Reserve is 45 Million Tonne
    1 tonne Maganese Ore cost USD 250
    45 X 10,00000= 450,00000 tonnes Maganese Ore

    USD 255 X 450,00000

    USD 11470,00000 Cost of Iron Ore

    Rs 45 x USD 11470,00000 = Rs 52,000 Crore

    I have taken USD at Rs 45 while current price is around Rs 46.5, Iron & Maganese Ore price are fluctuating and within next 2-3 years it may double so reserve value would get more added.

    This company is 1/5th size of NMDC and NMDC has a Mkt cap of 1lac crore.
    Looking at this OMDC should be atleast 30K-35 K……..and the current Mkt cap is less than 2K.That gives the opportunity of a huge upside opportunity.

    Apart from this in a recent inteview in Live Mint, Mr Chandra was qouting about Split and bounses possibility because it wishes to go ahead with the listing of OMDC on NSE also.

    So my analysis gives me hardly any downside for this scrip…but a huge upside is awaiting it.

    Please find the path for annual report of 2009-2010.

    http://birdgroup.gov.in/companies/omdareports/aromdy910.pdf

    Company website link

    http://birdgroup.gov.in

    Let me know your thoughts on this……

    Regards,
    Vikas

    Vikas

    September 10, 2010 at 11:02 am

  8. Thanks Vikas for the run through,

    So triggers are present. Thats what its all about, limiting downside and upside will take care of itself.

    One correction we may need to make in computation of “worth” of company is to multiply reserves to a certain Rs/$ figure. 125$ may not be right because the Iron ore that will be mined 5 or 10 years from now needs to be adequately discounted. Therefore, we need peer comparison, i.e. how to value mines. Commodities has not been my forte but little bit of digging should reveal a ballpark formula to compute instrinsic value of mines.

    I will try to find this over weekend.

    Looks like a very volatile stock but potential is there. On first look falls in too hard bracket to allocate 25% weight to portfolio.

    Regards

    Amit

    Multibagger

    September 10, 2010 at 11:39 am

  9. Hi Amit,

    There is one major trigger to this stock in coming months…….RINL (Rashtriya Ispat Nigam limited) which runs the vizag steel plant will be aquiring OMDC.OMDC will soon become subsidary of RINL and with this it will acquire Gov stake of 48% from EIL (Eastern India investments) a holding company.
    This will trigger a open offer for OMDC shareholdersThis shld shot the price on a higher side.
    Gov is doing this restructring to safe gaurd Iron ore demand by RINL, which used to procure the same from NMDC. This will enchance the topline further

    And apart from this it is a strong bonus and split candidate.

    This stock is yet to be discovered by other people…..it virtually an unknown stock for many people.
    Its publicity shld expand the PE further.

    Actually i found this stock from one blog by Vikram Solanki.Credit goes to him.

    Let me know ur thoughts on the same…….

    Regards,
    Vikas

    Vikas

    September 11, 2010 at 12:28 am

  10. Hi Amit,

    I couldn't find anything about OMDC in the above mentioned link
    Can you please forward the contents about the same?

    Regards,
    Vikas

    Vikas

    September 11, 2010 at 2:40 am

  11. Hi Vikas,

    I have replied to you by email

    Cheers

    Amit

    Multibagger

    September 11, 2010 at 10:45 am

  12. Hello Sir,

    Any new stock idea for current market

    Thanks,
    Hitesh

    Hitesh

    November 13, 2010 at 1:03 pm


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: