Back to the Roots (#045)
Two biggest conglomerates in India are transforming themselves. Want to take guesses?
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From now on, I shall be posting exclusive content on Stocktwits
Hey folks!
The Stocktwits India edition is live now and just like Twitter, it is an exclusive platform that brings together the world’s best investors and traders.
It comes with integrated Stock tickers that lets you see the fundamental and technical commentary of multiple stocks in one place.
You can use this link to download the app or sign-up on the web below 👇
My user ID is the same as that on Twitter - mehrotra_saket
Here are a few glimpses of the exclusive content posted.
Conglomerate Premiums
Let’s first start with the Tatas.
Ever Since N. Chandrasekaran came at the helm of Tata Sons, we are seeing a massive transformation across multiple Tata Group Companies.
Whether it’s TCS or Tata Communications or Tata Global Beverages, the list will fall short of the names of companies that have created massive shareholder value.
Last week, the Government finally announced the much awaited divestment of Air India which had been bleeding taxpayers’ money for decades.
We can always look out for Amul to make the most relevant advertisement. But this actually made a comeback to the roots. The Tatas were actually instrumental in benchmarking luxury standards of Air Travel back when it started.
After dominating the Indian hospitality with room inventory through the Taj group of hotels, airlines come in as a logical extension to be a travel behemoth.
Given that most of the discretionary purchases on the credit card are for the category of Travel this also augurs well on a strategic front for the Super App ambitions of the Tatas.
Moving on to Reliance.
A while back I had written a two part series on RIL which can be read here (Part-1) and here (Part-2).
Reliance in the recently concluded AGM announced their green energy ambitions and lo behold, here’s what transpired today 👇
While they are trying to make serious play in Solar, Hydrogen and also looking at becoming net carbon positive, here’s how they stack up against their global peers as per a recent Morgan Stanley report.
Webinar Updates - October 2021
The October Webinar schedule is out. Find out more about it here.
We had our second webinar session for October concluding the series on reading the basics of Financial Statements by understanding the relevance of a few key areas in the Annual Report to understand the industry structure better.
Click here to check it out.
[Premium] IndiaMart Intermesh - What makes it unique?
IndiaMart Intermesh (IM) has had a stellar run on the Indian bourses. IM had an issue price of 971 when it was put on offer for an IPO, listed for 1,180 ending up at 8,800 as on 7th October 2021. While the stock has gone up close to 10x in ~2 years, let’s take a step back to dissect what is at play here.
IM is in the business of providing online classified listings for SMEs and B2B suppliers. A report published by KPMG India & Google on the impact of the internet and digitization on SME’s shows an interesting trend.
While 32% of the Indian SME industry is online (between Connected, Enabled and Engaged) only 2% of the overall universe is ‘Engaged’. While it is well known to most of the SMEs consciously, adopting online tools to create business advantage can often be a daunting task.(Probably the only article you need to read to stay on top of things in this space.)
Click here to read more.
Alpha Swing
In this week’s 3 swing trades, we are back with the interesting guessing game.
If you can guess the stock right, you get a complimentary 1-month premium access to Alpha Swing.
Hint - 94% of this Company’s Assets are in Cash which is ~2,421 cr.!
The company recently posted a quarterly EPS of ~30 making the annualised EPS at 135 factoring in a modest 10% growth. This makes the stock trading at a forward PE of 65x against a trailing PE of 92x.
While competition has recently heated up in this space with a few incumbents coming in, the management has stated that they shall strive to maintain their leadership position.
Guess the stock.
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StockRoom Sunday
Podcast of the Week
Song of the Week
Once again we’re seeing a small example of record labels in India doing interesting things with their content.
Tips is re-creating Jagjit Singh’s iconic ghazals with contemporary singers in a 12 part series. This is the first one.
Coke Studio vibes, anyone?
Book of the Week
Mom, I want to sell books on the Internet and quit my job at DE Shaw on Wall Street.
What?
Yes, and I want you and dad to invest in this company.
What do you mean you want to sell books on the internet? Do it on your weekends and DO NOT quit your job.
No mom, things are moving fast and I need to be on top of things!
Imagine Jeff Bezos having this conversation when people had just started hearing about the internet.
The Everything Store gives you a good rounded view on the genesis and evolution of Amazon and why everyday at Amazon is Day 1.
Click here to check it out.
If you liked reading this, why not make someone else smarter too?
Will see you again next week.
Ciao.