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Category: Conferences
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What is Uday Kotak cooking?
Source: WhatsApp Forward
We have a special treat today. Sanjay Rao has shared his Notes from the Million Dollar Round Table Conference . Sanjay is one of the most respected Financial planners in India and is well-known in Pune by his moniker “Financial Coach”.He can be reached at Sanjay Rao
The theme of the day was Winds Of Change.
The first speaker was Swami Gyan Vatsalji from BAPS Sanstha.
He spoke on the basic foundation of people which either make them or break them- ETHICS,VALUES and BELIEF.
He gave a log of current affair examples such as loss of Usain Bolt’s 2008 Beijing Olympic medal due to a doping charge on one of his team members, downfall of Rajat Gupta due to insider trading charges and a few more.
He made suggestions on a few very good books to read like Why the Mighty Fall by Jim Collins.
Key take away points :
Undisciplined pursuit for more always results in a downfall sooner or later, as the cliche goes.. Karma always catches up.
The second speaker was Mark Hanna, President of MDRT .
He started by talking about the esteemed MDRT organization and on how being a part and attending these sessions not only motivate but help one’s business. Initially this didnt make sense to me but as the day proceeded and you open your mind like a sponge you get filled in with tonnes of ideas,positiveness and the fire to excel.
He spoke about the importance of believing in yourself, having a fierce desire to succeed and an insatiable curiosity
Key take away points :
Be the best in what you do.Reaching that level will boost your self confidence and self esteem
The next speaker was Krish Dhanam, a motivational speaker .
The kind of energy Krish brought was simply amazing.He spoke about the Mood of change.
This touched on the subject on how you need to look good, feel good in order for someone else to feel the same about you.
Then comes the Method of Change. This change occurs on the inside. Then we have the Message of Change followed by the Medium of change.
Key take away points :
You can have everything in life you want if you help others get what they want. Knowledge is learned ,wisdom is lived.
The next speaker was Dr Pawan Agarwal who delivers sessions on Supply Chain Management of Mumbai Dabbawala .
When he started, it sounded too loud but after his 15 minutes of speaking you realise that its his innocent passion and conviction that is delivering the speech.
He spoke about Time management, Retention/Attrition, Commitment, Leadership, Customer Satisfaction, Quality, 100% Execution, Logistics & Supply Chain . All relative to the Dabbawalas.
He cracked a few jokes @ how they re not just the carrier of food but also love letters, mobiles, sometimes people’s salaries… all in the dabbas . You could truely feel that these people are the lifeline of the Mumbai working class and you are humbled by their hard work, dedication and passion
Key take away points :
Work is next to Godliness. Do not do any work half heartedly .
Next to come was Mr James Pittman, the Vice President of MDRT . He spoke on how important it is to build up on a clientele system. He filled us in with the advantages of being a member of MDRT
The next speaker to come was Mr Bharat Parekh, a very successful advisor and a life member of MDRT for the last 24 years .
He spoke in length on how to do business and the mantra do what you do best and delegate the rest.
He cited this with a picture of his huge team that does all the backend work and he has enough time to face the clients. He shared some innovative ways to get business . Acknowledging the important client dates such as birthdays, anniversaries, Office Inauguration dates and holding events for kids birthdays,housewarming .
Key take away points :
Time is not money, relationship is money.Keep investing in it.
If you continue to do what you have always been doing, you will continue to earn what you have always been earning. PROSPECT UP.
The next speaker got us lumps in our throat. She was Arunima Sinha, World’s first female amputee who climbed Mount Everest.
She has already climbed 5 peaks in different continents. Her story on how she lost her leg due to resisting thieves who pushed her out of a moving train and her road to recovery brought chills down our spine.
Then she spoke how she overcame resistance from every corner in order to achieve her dream of climbing Mount Everest and prove it to the world .
Key take away points :
If you have the will,the drive, the passion and the heart to do something…nothing in the world can stop you and somehow or the other things will work out
The next speaker was Gajendra Kothari, Managing Director and CEO of Etica Wealth Management Pvt Ltd. He mainly spoke on how Technology will rule everything and how one should change their business processes as per that.
Key take away points :
Use the various technologies available to make yours as well as your clients life easier. Also be more productive in doing automation for enhancement of client experience by generating monthly newsletters, birthday, anniversary wishes
The last speaker got on stage from the audience to the tune of Bhangda encouraging everyone to stand up and join in. He was Bhupinder Anand, CEO of Anand Associates, IFA of the year.
The audience loved it. An amazing session where he spoke how powerful words can be and how one can implement it in the right way . It reminded me of a book on behavioral science by Robert Cialdini. Gave a lot of examples on how to handle objections.
Key take away points :
How to handle objections in a nice manner and make your clients get a clear picture of the situation without hurting their sensibilities
Post this there was an all ladies agent panel discussion .
Take away from the entire conference :
TIME MANAGEMENT — While this was mentioned numerous times by almost all the speakers I saved it for the last. A few speakers got there even before the conference started just so that they dont reach the venue late.
Indians as a majority have a very bad habit of making people below their hierarchy level wait for them, assuming their time is more important than others.
The successful people dont believe in this.They strive to be on time however busy their schedule is and apologize or reschedule when its not possible.
Another important take away is READ READ and READ. Successful people read at least 2 non fiction books a week. Try to get into a habit of reading at least 20 pages a day. That’s 36 200-page books that you will be ahead of your competition.
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Notes from Prashant Jain’s Talk
Attended a talk yesterday by Prashant Jain,ED & CIO of HDFC Mutual Fund.
This talk was organised by the SK Group.
Here are the key takeaways from Prashant Jain’s talk:
His take on the Budget:
- Its a no-nonsense Budget
- Once GST is passed,Budget will become a simple boring affair
- For first time in 25 years,he was able to leave office by 7-30 pm on Budget Day as there is no major policy changes in the Budget
His take on the Modi Govt:
- It is a very purposeful and determined Govt
- The Govt has a few priorities and all its actions can be seen from this framework:
- Reduce the fiscal deficit: This will result in low inflation,low interest rates and more resources for the private sector
- Increase tax revenues: Demonetization and GST leaves a trail that will widen the tax revenues
- Stopping wasteful expenditures: Direct Cash Transfers using Aadhar and Bank Accounts have reduced siphoning off of funds
- Improve service delivery to common man: Every scheme now has an “outcome based” approach instead of “outlay based” approach.For example,outcome of all villages electrified,133 kms/per day of roads,10L ponds under MNREGA etc
- Simplify: Using Technology to simplify processes and doing away with redundant laws, policies and practices
- Environment: Supporting sources of energy like wind,solar etc
- In the coming years, India will definitely reap the benefits from all the work done by the Govt
His take on Demonetisation:
- Short term pain for medium and long term good for the people of India
- No impact on this in the next Quarter
- Full effect was not realized due to collusion of Bankers
His take on the India Growth Story:
- India is a secular growth story
- It’s gowth increases every year irrespective of domestic and global conditions
- The reasons are as follows:
- Demographics
- Change from Joint to Nuclear Families
- Low penetration of products/services
- Faster and shorter product cycles
- Real growth in India can cross 8% in the coming years
Why some companies are not growing despite GDP growth:
He gave example of Unilever.Said three reasons why it’s sales are stagnant:
- Penetration levels are high.Soaps are there is most households…there are no new customers to be acquired
- Aspirations levels are high.As the consumer’s income increases,he is not going to buy more soaps…he will use the money elsewhere
- Competition-As new players like Patanjali come in,they take away market share from existing players as the size of the pie cannot be increased much
Two Sectors of the Economy Doing Badly:
- Real Estate-There is a tremendous demand for real estate but high prices makes it unaffordable. Suffers from high demand,low affordability syndrome
- Private Capital Expenditure- India does not require a power plant for the next 7/8 years.Private players in infra have been burnt badly
Macro Indicators of India are excellent:
Between FY2013 to FY 2016:
- GDP Growth increased from 5.6% to 7.6%
- Fiscal Deficit reduced from 4.9% to 3.9%
- FDI as % of GDP increased from 1.1% to 1.7%
- Current Account Deficit reduced from 4.7% to 1.1%
- CPI reduced from 10.2% to 4.9%
- 10 Year GSec Yield reduced from 8% to 7.5%
For the first time in the history of India ,FDI is more than CAD.
His take on the Sensex:
- Sensex is a very simple animal-it is a slave to earnings
- Short term moves are unpredictable
- Long term it has given a return of 15% CAGR in line with growth of economy
- Foreigners understand Indian equity markets better than locals.
- Their shareholding% of BSE 200 Companies has increased every year.In March 2001,it was 12%.By March 2016, it stands at a whopping 25% !
- Feels Indians should hold equities like they hold gold-for 10-20-50 years
His take on market cycles:
- Indian markets operate on the basis of cycles with clear sector leadership
- Between 1995-2000,IT was the Sector leader.Infosys’s PE went from 15 to 300 !
- Between 2000-2008,Capex.Banking and Commodities were the Sector Leaders. Jaiprakash Industries and Unilever India had the same market cap !
- Between 2008-16, Pharma and Consumer were the Sector Leaders
- When one sector takes leadership,all the money goes there and the rest of the markets become very undervalued
- Now the time is ripe for beginning of a new market cycle
- This new market cycle is characterised by:
- Low inflation
- Falling interest rates
- Rising Capex
- Peaking NPAs
- The sector leaders for this cycle would be Corporate Banking,Metals & Mining and Industrials
His take on the Stock Market:
- The Stock Market is very undervalued.
- The Marketcap to GDP ratio is the lowest in 10 years
His take on various Sectors:
- Corporate Banks-Bullish-NPAs are peaking,Banks are able to recover (e.g. Essar Oil).Makes an interesting point “Don’t confuse NPAs with losses.NPAs are an accounting entry,Loss is permanent erosion of Capital.”
- Metals-Bullish-Feels cycle is turning.Both Tata Steel and JSW Steel have announced fresh capex plans
- FMCG-Bearish-Feels low inflation environment does not favor them.Also,they are expensive
- Pharma-Bearish-Feels they are expensive
- Two Wheelers-Bearish-Feels their penetration is v high.Already 50% of Indian households own a two wheeler
- Auto-Bullish-Increasing incomes,increasing aspiration and low penetration
- Telecom-Confused-Not sure how new entrants will further act.Not possible to get multi-baggers from here
- IT-Confused-Not sure how this sector will play out considering various headwinds
- Insurance-Bearish.Three reasons:
- Expensive valuations
- GST may increase tax rates for insurers
- India is not under-penetrated as far as insurance is concerned
- Consumer/Lingerie-Bearish-Says super expensive trading at peak valuations
All in all, a great & candid talk by one of India’s most respected fund managers.
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Notes from the Sohn India Conference
(Disclaimer: The stocks mentioned in this post are for informational purpose only and not a recommendation to buy/sell)
Attended the inaugural Sohn India Conference today.
The Conference opened with opening remarks by Nitin Saigal,Founder &CIO, Kora Management
He explained the format of the Conference:
- Every speaker will be allotted 15 minutes
- The speaker have to give their best idea
- No Q&A
The first speaker was Raamdeo Agarwal of Motilal Oswal:
- His best stock Idea was Interglobe Aviation i.e Indigo
- He called it “A terrific investment in a terrible business”
- He said it had all the aspects of a terrific business
- Growing rapidly
- Insignificant capex
- Very very profitable
- He then explained the company with the help of his Q-G-L-P framework (i.e. Quality-Growth-Longevity-Price)
- Really enjoyed the clear thinking and analysis of Raamdeoji
The second speaker was Sunil Singhani of Reliance Mutual Fund:
- Being from Mutual Fund Industry,compliance demands he can’t give stock picks but can speak on sectors
- He started his presentation in a very unusual fashion-by showing two Bollywood scenes
- One scene was 20 years back where the Villain was drinking whiskey.The second scene was where superstar Deepika Padukone is drinking
- He explained that earlier Villains used to drink and now heros/heroines drink.Drinking has become socially acceptable
- He mentioned a startling fact-“One third of all people born after year 2000 are Indians”
- The young demography of India,the low per capita consumption,the social acceptability makes India Alcohol story a compelling one
- He said globally liquor companies were large value creators for shareholders and India shouldn’t be any different
Next was a video clip from Jeff Gundlach, the biggest Bond Fund Manager in the world.He mentioned that he is v bullish about India and has invested in Indian equities which he “plans to hold for a generation “ !
The third speaker was S Naren of ICICI Prudential Asset Management:
- Being from Mutual Fund Industry,compliance demands he can’t give stock picks but can speak on sectors
- His favorite sector was the “Hospital” Sector
- He feels that growing medical tourism and growing coverage of domestic Medical Insurance augurs well for the Sector
- He calls his sectoral view a “Multi Decade” view
- He made an interesting observation about the current state of the markets “Anything that is cheap is poor quality and anything that is high quality is expensive”
The fourth speaker was Kenneth Andrade,former Head of Investments,IDFC Asset Management:
- His favorite stock pick was Coromandel International
- He feels that the fertilizer subsidy regime is going away and the Direct Benefit Transfer scheme will put 11.5 Billion $ straight in the hands of farmers
- This should augur well for makers of complex fertilizers like Coromandel International
The fifth speaker was Shiv Puri of TVF Capital Advisors:
- His favorite stock pick was Repco Home Finance
- He feels this company is where HDFC was in 1995 and is capable of giving 45x returns in the next 20 years
- The external opportunity in semi-urban and rural is around 400 Billion $ which Repco is in a good position to exploit
Then there was a short tea break.Amused to see Rakesh Jhunjhunwala smoking in the Taj Ball Room during the break.Guess no smoking rules don’t apply to Billionaires
The sixth speaker was Rukshad Shroff of J.P.Morgan Asset Management:
- His first idea was a large private bank famed for its low NPAs
- He felt it could deliver 3x returns by 2026
- He felt that even at current valuations,it was a good buy because “Good Businesses overcome Valuations”.I thought that was a great line
- His next idea was a international fast food franchise.He did a top down approach and came to an estimate where if the business does well,the company’s market cap should be 7x the current market cap
The seventh speaker was S Naganath of DSP Blackrock:
- He first gave his view on global markets..said by Sept/Oct he expects them to have a significant correction of atleast 20%
- He said even Indian markets will get impacted by this…this would offer the “last opportunity to buy Indian Equities Cheap”
- His sectoral pick was PSU Banks.He said everyone hates them now but they should do well from a 3 year perspective
- Then he explained an idea he had called “TRICEPS”-Tax Rate Insurance for Creating Employment in Public Services
- As per this idea,Govt collects premium from individuals/corporates and promises not to raises taxes.It then uses the money to create jobs
- I found this idea bizarre and envy Naganath for the seriously awesome stuff that he must be smoking to think of such crap
The eight speaker was Shanker Sharma of First Global:
- He said his style of investing was to look for companies with problems
- He especially likes companies with D/E ratio of greater than 5
- His first stock was Kiri Industries
- This is a niche chemicals player which is growing its business,paring down debt and owns a significant stake in Dystar,one of world’s largest Dyes Companies
- The next stock idea he had A2Z Infra
- He said they are reducing debt and have a product called Magic Genie which ought to do well
The ninth speaker was Akash Prakash of Amansa:
- His stock pick was Federal Bank
- He said that it’s book was better than “ICICI Bank or Axis Bank.Nobody knows what’s in them !” Ouch !
- He explained why the Bank under-performed for the last 3 years
- He said the Bank should do well going forward as its corporate loan book/Gold loan book should grow and the cost cutting measures they are undertaking
The last speaker was Rakesh Jhunjhunwala:
- Surprised to see that he had to be helped to get on stage
- His first stock idea was Tata Motors
- He expected JLR to grow by 18% and domestic sales to grow by 20%
- Said he expects it to be in the top 3 companies in India in terms of revenues and profits
- His next stock pick was DLF
- Said its debt reduction efforts,lease income and land bank made it a buy
- He remarked that the entire real estate industry in India has a market cap of less than one pharma company-Lupin
- He admitted DLF is a “dog” in terms of investor perception .But “he had learned in life that’s where the opportunities lie”
The conference ended with a video clip of Stanley Druckenmiller’s famous “The Fed has no endgame” presentation.
On the way out,I was surprised to see that most of the Conference participants had come via Uber/Ola.I guess a mega trend is playing out right before our eyes.