Out of the six factors I mentioned earlier, this is the most difficult
part to identify and predict properly. i.e. identifying an upcoming sunrise
sectors at reasonably early stage. Other five factors can be analyzed either
quantitatively or qualitatively with much better precision, with the past available
data. Where this second factor requires little imagination and bit luck too.
Inorder to succeed in identifying gems based on this criteria, you
requires to have the required imagination skills to forecast 10 or 20 years
future outcomes and trends.
A simple example: If you were able to identify a revolutionary change in
mobile technology and invested in leaders like Airtel a decade back, it might have
turned a 20 Bagger by this time, still with lot of gunpowder left in it!
Another classy example I would like to pen is about two companies from
the same sector with legacy products, where one turned to be a huge huge multibagger
while the other is still drowning in mid sea!
Or
Amby
|
Vs
|
Bullet
!!
|
||
 |
 |
These two initial UKproducts, later turned to be Indian, suffered a lot
in the past to survive and both products only changed little during its life
span. One is out of production and the other is still the favorites of the
youth!
The success in investment / share market also will depend on your
prediction analyzing who will win the race?!
A decade back (say in 2001), if you have invested Rs. 10 thousand, both
will speak differently now, similar to the demand of the products!
Company
|
Inv Year
|
Avg Share Price
|
CMP
|
Inv amount
|
Present Value
|
2001
|
Rs 4/-
|
Rs 8/-
|
10,000/-
|
20,000/-
|
|
Eicher Motors
|
2001
|
Rs 24/-
|
Rs 14000/-
|
10,000/-
|
5,800,000/-
(Rs 58 Lakh)
|
I just gave this example to show that how much difficult is to identify winners
from the total pack.
Here in this case both companies having products with outdated technology
and both products were never changed much in its life time. Still one became the
favorite of youth due to its own reasons and at the mean time, the other one parked
in our minds with good old memories!
Similarly, in the whole world sectors like Motors, Pharma, Computer , IT
excelled in the past. NEXT BIG THEME MAY BE ROBOTICS!!!
Have enough imagination! (Nothing more can be said about this
factor)
Happy investing!!
Dear MVP
ReplyDeleteFantastic example with illustration.
Can we expect Arrow coated and SKM Egg Products shall be in the similar business opportunity,scalability and sustainability.
please provide your valuable suggestions and comments
best regards
I am bullish on Arrow since its business is easily scalable t any level, where SKM business needs eggs and producing it is not that easily scalable.
Deletergds.
Which are the companies dealing with ROBOTICS you like to be in for next big thing?
ReplyDeleteSorry, No Indian companies yet, but not even prominent companies in the world itself.
DeleteI mentioned it as a next big big theme.. may be for next 20 - 50 - 100 Year story!!
few hints and details may be from following sites / links :)
http://en.wikipedia.org/wiki/Boston_Dynamics
http://www.bostondynamics.com/
http://multibaggersindia.blogspot.com/2014/09/biggest-market-cap.html
DEAR MVP.. THE NEXT BIG THING MAY BE GRAPHEN...THE TECHNOLOGY AND THEME BOTH IN NASCENT STAGE..BUT HAS HUGE POTENTIAL GOING FORWARD...COMPANY TO GET BENEFITED MAY BE THOSE ENGAGED IN THE GRAPHITE MINING..AS GRAPHITE IS THE RAW MATERIAL FOR GRAPHEN..HOWEVER, I AM UNABLE TO FIND ANY OF THE CO. LISTED IN BSE AND NSE IN THE FIELD OF GRAPHITE MINING ...CAN YOU FIGURE OUT???/
ReplyDeleteHi Chetan,
DeleteTrue, Graphen also may be the next big thing.
But i don't see any substantial gains for Graphite producers, since here the most important factor is not the raw material but the process. [i.e the process converting graphite to graphen]
A similair case silicon is made in to a processor. Intel makes 500$ chip from 1$ silicon. Wh makes money??
Similiar case will be applied to Graphen also :)
sir but many efficient technology is coming up. in fact i am into research and prepared boron nitride nanosheets (inorganic analog of graphene) with simple mechanical process. but it is true scalability is still issue in this technology. why i am asking abt graphite mining co is becos in the west there is huge projection about these co. with role to play in graphene technology
DeleteHi,
Deleteof-course I didn't mean that graphite companies won't make any profit. They may be getting a mere share of it (if the technology grow), say 5 or 10%, but the entity who make the end product will be making 90+ % of the gain based on a particular technology.
Dear mvp sir....got yr point...still want you to give me a name of listed co in graphite mining in india
DeleteCurrently I am analysing Intrasoft Technologies . It has Online retail shopping site http://123stores.com/ in USA which is growing fast (more than 100%). If we are looking for opportunity, scalability then Intrasoft Technologies fits in it but needs to look other factors as well.
ReplyDeleteDo you think intrasoft can scale high. At lease I don;t see any huge margin jump
DeleteMost of the ecommrce website are loss making in their initial investment phase , forget margins , they don't even make profits . But once they get economical scale they start making huge money.Sanpdeal , Flipkart , Amazon all are making huge losses in India but PE playesr are making huge investment in them and ready to wait for long time . That is quite impossible for listed player since investors are very in-patience . Alibaba is listed recently which was also making huge losses in initial years . This PE players are very patience with their investment and early investors makes real money . I believe, Intrasoft should be watched closely and invested slowly with rising topline if you are patience investors may be like Westlife Development Ltd (mcDonalds india)
ReplyDeletedear mvp sir
ReplyDeletedo you still believe one should buy arrow. i found this stock on vp blog but invested only when u substantiated that it has long way to go. so far i accumulate only 50 shares of arrow at average price of 290. it is running so fast that it is almost impossible to accumulate at decent level. it is very frustrating to see that arrow has becomes mad. not stopping and consolidating for a while.
In this case, I can tell you only one thing, never sell out your winners (if the underlying business is still good ).
DeleteValuation wise a 10 Bagger can be yet another 20 Bagger and still another 30 Bagger !!
thats quite encouraging sir. i will not sell even single share..and try to buy more as and when i get a chance.
DeleteHai MVP
ReplyDeleteThere is lot of gossips are going in market about the Arrow coated products . I would like to request you tp provide us the latest update on this scrip and at the same time we are very much thank ful for selecting such great type of script which has the future.
But we need your valuable comments and latest update on our future actions.
regards
Hi Ganesh,
DeleteWhat type gossip u r mentioning?
I am not aware about any product specific gossip..
pls give details
rgds..
Dear MVP
DeletePeople are guessing lot of future for the arrow coated products market is there and speculation is very high on this script, by which it is jumped from 12 to 488 equal to 40X with in span of 1.5 year. Sir, is this sustainable growth or going to collapse ?
Please provide your valuable comments and guidanace to us.
looking forward for your comments
best regards
Did you stop monthly SIP of 5000/- which you started with the start of this blog? Have your interests lost from VP's blog? just trying to find reason behind it? pls explain.
ReplyDeleteme too asking same as Mayur
ReplyDeleteThe initial way of announcing SIP may not be possible in future due to SEBI restrictions, so trying to make a strategy so that will not require much intervention from my side. Working on that lines.
DeletePls wait few more days..
rgds.
Regarding Arrow Coated queries, a separate post is given.
ReplyDeleteThanks lot and bets regards sir
Deleteyou may use bulk mail for telling SIP monthly. My id is msatribeniatgmail.com
ReplyDelete