Month: August 2017

Canfin homes – The out performance continues

Previously I wrote on Canfin homes here

The sustained outperformance was noticed when I was reviewing GRUH and REPCO a few days back

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GRUH Finance and REPCO homes both had decent year however when compared with Canfin homes there was performance was little subdued, which you will see in detail below

The top line (Loan book growth) was good for both companies including loan mix

Bottom line growth has clearly tapered down to 20s from 30s seen in FY12-14 years, both firms exercised good control on operational costs thereby continuing to reduce cost to income (C/I) ratio , GRUH following HDFC is having industry leading C/I ratio

On Contrary CanFin homes had an another fantastic year

Lending practices were tight with minimal net NPA

GRUH’s return metrics remain best in class however others are closely catching up

Overall both companies had a very decent year. But clearly, now 3 years in a row CanFin homes have outdone its fancied peers

Future variables to track

  • Loan book growth
  • Net NPA

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Forecasting and Reality – Review of Suven Life sciences

I have previously written by Suven Life Science here and here

Reading and learning about Suven Life sciences has been huge learning curve, it has taught me few things

  • Forecasting in excel and actual numbers in real world are two different things, so one should not take their excel skills seriously. If you need a proof just refer my revenue and bottom-line prediction from last few years for Suven
  • Drug discovery is a long , hard and uncertain process and putting your odds is as good as throwing a dice. There are far few too many variables to model an outcome
  • Entrepreneurship is a long term commitment and as Investors, we are so lucky to jump the ship after a poor quarter, not the promoter who many times has put his/her everything on line

Reviewing 2016-17 performance of the company

Firstly numbers and management’s guidance for next year

 

All figures in INR cr except % 2015-2016 2016-2017 Growth 2017-18 E
Base CRAMS [Balancing Figure] 244 253 4% 291
CRAMS Commericial Supplies 0 34 100% 60
Speciality Chemichals 224 224 0% 224
Technichal Services 32 33 3% 33
Revenue From Operations 500 544 9% 608
Other Income 19 21 11%
… Read the rest