Forecasting Folly:Cebbco

This post is in continuation of my forecasting series (see here)

The forecasting folly case of Cebbco was pointed out to me by reader Puneet Pattar.

Cebbco was a darling of many brokerage firms who recommended it with various price targets .An article detailing their shenanigans can be found here

But what I find interesting is that well known investor Gul Tekchandani recommended this stock on Oct 31, 2012.In an interview to ET, he was asked:

Give me a stock idea where you are putting your money to work, where you are confident of a 15%-20% appreciation in next 12 months, next 18 months?

 

This should be taken as a disclosure as well; I have just about bought this Commercial Body Builders which is at about Rs 90. And I am always buying and selling the top line companies, but this is a new addition to the portfolio. I expect that this company will grow at 50% per annum and will give a smart returns, and does not require any money at least for a couple of years so that should help.

 

We all know what happened after that.Cebbco crashed spectacularly and is quoting around 30 Rs !

Forecasting folly, anyone?