Aavas Financiers is entering the primary market on Tuesday 25th September 2018, to raise up to Rs. 400 crore via fresh issue of equity shares of Rs. 10 each and an offer for sale (OFS) of upto 1.62 crore equity shares by 4 promoter group entities and 2 top management personnel, both in the price band of Rs. 818 to Rs. 821 per share. Representing 27.93% of the post issue paid-up share capital, total issue size is Rs. 1,734 crore at the upper end of the price band, of which, OFS accounts for 77%. Issue closes on Thursday 27th September and listing is likely on 8th October.
Company Overview:
Aavas Financiers, established by listed NBFC AU Small Finance Bank (formerly AU Financiers) in March 2012, as AU Housing Finance, is a Jaipur, Rajasthan head-quartered affordable housing finance company, providing home loans of Rs. 8 lakh average ticket size to 60,000 customers, through its 166 branches in tier 2 to tier 6 towns across 8 Indian states, with gross loan book of Rs. 4,356 crore (30-6-18).
Investing is full of sports metaphors, most of which are drawn from blood sports such as boxing, strategic team sports including football, and individual sports where brains are as important as brawn, such as golf. Those sports are all full of common metaphors drawn from warfare. In fact, all sports are, in essence, proxies for warfare, which makes a 2,000-year-old text particularly relevant to sports, but also to investing as well.
Translated into many languages and still referred to as one of the great works on military strategy and tactics, the lessons of Sun Tzu’s The Art of War are particularly relevant to investors as they navigate increasingly complex asset classes and investment strategies.
Garden Reach Shipbuilders and Engineers is entering the primary market on Monday 24th September 2018, with an offer for sale (OFS) of up to 2.92 crore equity shares of Rs.10 each by the Government of India (GoI), in the price band of Rs. 115 to Rs. 118 per share, with a discount of Rs. 5 per share for retail category. Representing 25.50% of the post issue paid-up share capital, total issue size is Rs. 340 crore at the upper end of the price band. Issue closes on Wednesday 26thSeptember and listing is likely on 5th October.
Company Overview:
Garden Reach Shipbuilders and Engineers is a Mini-Ratna Category 1 company under the Ministry of Defence, manufacturing warships for Indian Navy and Indian Cost Guard (90%+ revenue derived from them) under its ship building division. It also has an engineering division, accounting for less than 10% of revenues, manufacturing deck machinery for ships, pre-fabricated steel bridges and marine pumps. With 3 manufacturing facilities in Kolkata, company’s order book position (31-7-18) of Rs. 20,314 crore is very healthy, as it includes order for 3 ships for the Indian Navy, aggregating Rs. 19,300 crore, to be delivered from FY24 onwards. This will contribute to revenues meaningfully from FY21 onwards, as company is yet to commence work on these orders. Till then financial performance may be subdued as revenue peaks in the middle of the typical contract duration of 5-6 years.
Volume is representative of how many shares change hands in a stock, and as such, it indicates the interest in a security. Since each stock is different, and has a different amount of shares outstanding, volume can be compared to historical volume within a stock to spot changes, or compared to other stocks to find which are suitable for trading. Volume is also used to confirm price trends, breakouts, and spot potential reversals. Volume has also been implemented into indicators, which can aid in analyzing stocks (and other markets).
Volume Significance
Volume is important because it shows the level of interest in a stock. Current volume in a stock, relative to prior volume, shows if interest is higher or lower in a stock than it was before. High volume, or relatively high volume (compared to prior volume), is more suitable for active traders. Very low volume typically indicates a lack of interest and usually little price movement. Volume is also significant for screening stocks. Average volume—the typical volume seen in a day over a period time—helps greatly in this regard. Day traders need to be able to get in and out of a stock quickly and with ease, so they will want to trade stocks with high daily volume – typically 1 million shares at absolute minimum.Swing traders and investors have a little more leeway and therefore may trade stocks with lower volume, around 500,000 and 100,000 shares or more per day, respectively. They still want stocks that have enough volume to get in and out when they need to, but the urgency is not quite as high as it is for short-term traders.That’s the significance of volume as a defined number; here’s how to analyze it.
Analyzing Volume
There are three primary ways we can use volume in conjunction with price analysis: confirming trends (or not), spotting potential price reversals, and confirming price breakouts (or not).
Investment pundits – ourselves included – write a lot about how checking your portfolio too frequently is hazardous to both your financial and mental health. The evidence is overwhelming that those who check their portfolios on a daily basis tend to underperform those who check their portfolios less frequently.
The reason is simple: On any given day, there’s almost a 50-50 chance the market will be up or down. Because people dislike losses more than they enjoy gains – a behavioral finding known as loss aversion – people who check their portfolios daily find the process painful. And just like your gut reaction to pain is to draw away from the source of that pain, your gut reaction to seeing an investment lose money is to make a change. To sell. To panic. To act.
Changing your portfolio, or market timing as our Chief Investment Officer, Dr. Burton Malkiel calls it, is an investor’s Most Serious Mistake.
So what’s the solution? Just check your portfolio less often, right?
Unfortunately, things really don’t get much better if you check less frequently.
• IRCON is under Railway Ministry.
• It enjoys MINI RATNA status.
• It has planned relisting after a gap of 7 years.
• Issue is attractively priced with a discount of Rs. 10 per share for Retail investors.
• It has order on hand worth Rs. 22406 crore.
ABOUT COMPANY:
IRCON International Ltd. (IRCON) is an integrated Indian engineering and construction company, specialising in major infrastructure projects, including, railways, highways, bridges, flyovers, tunnels, aircraft maintenance hangars, runways, EHV sub-stations, electrical and mechanical works, commercial and residential properties, development of industrial areas, and other infrastructure activities. We provide EPC services on a fixed-sum turnkey basis as well as on an item-rate basis for various infrastructure projects. IRCON also executes on build, operate and transfer mode in various projects in order to meet the requirements of its bids. In 2016, the company ranked number 248 in the list of the top 250 international contractors by Engineering News Record (ENR) of the United States. IRCON is headquartered in Saket, New Delhi and has an overseas office in Malaysia. Additionally, have 26 project offices in India and abroad (including in Sri Lanka, Bangladesh, South Africa and Algeria) and five regional offices to support and manage business operations. IRCON enjoys “Mini Ratna” status.
Big gains can be hard to find in the financial markets. Nowadays, though, they seem to be everywhere — and that could change how you feel about taking risks.
As of Nov. 16, the S&P 500 is up 359% since the bull market began March 9, 2009, counting dividends, according to S&P Dow Jones Indices. This year alone through Nov. 16, Alphabet (the parent company of Google) has returned 32%, Amazon.com 52%, Apple 50% and Facebook 56%, including dividends. Bitcoin, the digital currency, has gained more than 700% so far this year.
Against that backdrop, even what investors used to regard as a generous annual gain — say, 10% — starts to feel paltry. New research into a mental process called “contrast effects” shows how that works and how it can alter your behavior.
Finance professors Samuel Hartzmark of the University of Chicago Booth School of Business and Kelly Shue of Yale University’s School of Management analyzed nearly 76,000 earnings announcements from 1984 through 2013 in which companies earned either more or less than investors were expecting.
One of our favorite investors at The Acquirer’s Multiple – Stock Screener is Bill Miller.
Miller served as the Chairman and Chief Investment Officer of Legg Mason Capital Management and is remembered for beating the S&P 500 Index for 15 straight years when he ran the Legg Mason Value Trust.
One of the best resources for investors is the Legg Mason Shareholder Letters. One of the best letters ever written by Miller was his Q4 2006 letter in which he discussed the end of his 15 year ‘winning streak’ and how too many investors miss the most important aspect of investing by focusing on value or growth. Miller writes, “The question is not growth or value, but where is the best value?” It’s a must-read for all investors.
Here’s an excerpt from that letter:
Calendar year 2006 was the first year since I took over sole management of the Legg Mason Value Trust in the late fall of 1990 that the Fund trailed the return of the S&P 500. Those 15 consecutive years of outperformance led to a lot of publicity, commentary, and questions about “the streak,” with comparisons being made to Cal Ripken’s consecutive games played streak, or Joe DiMaggio’s hitting streak, or Greg Maddux’s 17 consecutive years with 15 or more wins, among others. Now that it is over, I thought shareholders might be interested in a few reflections on it, and on what significance, if any, it has.
Here’s a great article at the WSJ by Burton Malkiel, author of A Random Walk Down Wall Streetand Chief Investment Officer of Wealthfront. Malkiel provides two strategies that might be worth considering in an overpriced world saying:
“What, then, can an investor do to control risk? The two strategies that work are broad diversification and rebalancing.”
Here’s an excerpt from that article:
What should an investor do when all asset classes appear overpriced? The 10-year U.S. Treasury bond currently yields about 2.6%, much lower than the 5% historical average and only slightly higher than the Federal Reserve’s 2% inflation target. Yields of lower-quality bonds are unusually meager compared with those of traditionally safe Treasurys.
For equities, the cycle-adjusted price/earnings ratio, or CAPE—the valuation metric that does the best job in predicting future 10-year rates of return—is about 34. That’s one of the highest valuations ever, exceeded only by the readings in 1929 and early 2000, prior to crashes. Today’s CAPE suggests that the 10-year equity rate of return will be barely positive.
Here are some top investing tips to consider amid the market volatility.
Ben Graham
Widely regarded as the “father of value investing,” Graham’s surgical analysis of stocks made him and his clients a great deal of money. But before he became Warren Buffett’s mentor or earned Wall Street’s reverence, Graham lost most of what had already become a small fortune in the stock market crash of 1929 and the ensuing Great Depression. It was then that Graham learned a hard lesson about risk-taking.
After that, Graham became one of the first to make investments based solely on financial analysis. Before his death in 1976, Graham’s philosophy was simple: invest in companies whose shares trade below the firm’s liquidation value. He implemented smart analysis of market psychology, investing by numbers when others did so by fear or greed.
