Month: January 2016

Using secondary Information

Using secondary information is one of the best sources to top up our investment hypothesis, I have previously written on it here & here . One of the best sources of secondary information is research done by others, especially brokerage houses who do a good job and not one’s like this.

Recently Nirmal Bang’s Gaurang Dadwal & Akhil Parekh did an excellent initiating coverage for Atul Auto. This is close to the best investment report you will find freely from brokerage houses.

I have highlighted some of the new things that I was not aware about the company (Like they are paying more than competitors for engine) and have also tried to highlight how I read these reportsquestioning, understanding, highlighting, scribbling until and unless I feel, i have got most out of it.

Download part 1 and 2 and share your observation and learning in comments
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Max India – Spin off Analysis

In Jan’ 2015, almost a year back diversified firm Max India spin off plan were announced management indicated it is splitting listed entity into three companies with the existing firm becoming India’s first listed company with insurance as the sole business.

The Max India Group is a multi-business corporate, the listed entity has following primary business

  1. Life Insurance – As a 74: 26Joint venture with Mitsui Sumitomo of Japan
  2. Max healthcare – Operating as equal JV with Life group of South Africa
  3. Health Insurance – As a 74: 26 Joint venture with BUPA of UK
  4. Antara – 100% owned retirement living real estate venture
  5. Max specialty Films – 100% owned

Last year the conglomerate began a demerger exercise which will result in listed company being spilt into three listed companies as per below

Max India -1

Source – Investor presentation, Nov 2015

In this brief post we try and examine if the sum of parts would be greater or lesser than the current M-cap, Let’s go to the drawing board.

Max Financial services – The largest piece of the spun off entity is a well-established life insurance provider in India. Life Insurance is a crowded place in India were on one hand we … Read the rest