Monday 18 January 2016

Sharekhan Investor Training 16 Jan 2016

Hi guys, Nrupen here and on last Saturday I attended Sharekhan's Investor Training Seminar. The seminar was presented in 3 parts.

1. Investment Basics and Investment Planning
2. Market Overlook For 2016
3. Promotional Stuff

Chirag Joshi took first and last part of seminar whereas Analysts from Sharekhan took Market Overlook.

He started with Reasons Why You Should Invest, and gave 3 reasons,

1. Beat Inflation
2. Maintain Standard Of Living
3. Plan For Retirement

Though all points were convincing enough the examples he used were really not that convincing for me, later talked with others and they also agreed example he used weren't really that good.

Practically all can admit that we usually use 5-6 % inflation rates for future price calculation of standard of living but same doesn't apply to education and medical care. When he applied 5-6 % inflation rates to them things appeared too unrealistic.

Prices of medical care and education rise at possible high rates as compared to rise in price of other stuffs required to maintain standard of living. To most parts he was right on every point but examples weren't that good.

For most part Chirag kept seminar interactive and there was active contribution. He took a little test on ability to manage and invest money and then gave conclusions based on marks.

I took 18/30, based on my marks conclusion was I actually know and actively try my best to learn  managing and growing money. I also take action but fail big time, money comes to door and returns because of failed execution resulting in bad financial situation.

I could agree more, whenever it comes to execution of plans, I mess up big time leading to bad financial situation.

Then he talked about “How To Invest”,
1. Identify your goal
2. Set time horizon
3. Quantify your goal
4. Different Investment avenues
5. Selecting Right Investment avenues

To me these points seem more theoretical because they are practical application of goal setting which typically considers goal can be achieved in steps first A then B then C and then D. In real life things doesn't always go in linear steps.

For example, you train hard to become world class athlete and then due to accident or illness you become medically weak and all your hard work ends up in drain. It is story for majority and step by step success without any problem only happens by luck and that doesn't apply to everyone.

For majority of time you just have to keep working to find opportunities or create one for yourself.

Chirag also told about advantages of PPF, SIP, Family Medical Insurance, ULIP, Term Plan and Liquid Funds.

He strongly advocated Family Medical Insurance, Term Plan and PPF. He also advised for people who can't invest in stocks themselves should opt only for SIP but shouldn't expect good returns unless ready to wait for at least 7 to 10 years.

He also advocated to learn money management and suggested 2 books to read.
Rich Dad Poor Dad
Eat That Frog

Then I took a piss break, on return second part has already started I couldn't get name of presenter but he appeared more like an analyst and was presenting, “Market Overlook For 2016”.

He started with what went wrong in year 2015 leading to fall in market. He told they also took seminar in Mumbai and people aren't happy with their investments because they suffered losses.

I was damn happy to see majority of Nagpurians shouting they made decent profits. Some said they were sitting on short positions whereas others said they bought Mid Cap and Small Cap stocks and there were also few like me who preferred Ultra Small Cap stocks.

Following are some points which he explained due to which market may see huge upside in 2016,

1. Market has always traded on PE of 13-15 and we are right now on PE of 15
2. FDI may help market.
3. High hopes on passing of GST.

Apart from these he gave some market stats that can lead to major upside. Majority of market overlook was based on predictive elements and personally I have seen enough not to take predictive elements seriously.

I am also negative on passing of GST and FDI. I am not saying market will keep falling but as per my personal opinion these elements will not become reason for market to regain its upside.

In final part Chirag came on stage and gave information about Sharekhan product and services. Along with that he added bits and pieces of fundamental and technical analysis.

When it ended I went directly to analyst panel and had some chat. First, they told me about JHS Svendgaard Laboratories stock from personal care sector. They had Proctor and Gamble as their client.

P&G left them and stock fell to Rs.5 now they are in JV with Dabur and Patanjali leading to price jump till Rs.35, as per them value unlocking for this stock has not yet began and major upside is still on way.

Then I told them my method to select stock and also told them about stock I am holding right now.

On which they gave me some more stocks and told me these stocks are commodity based stocks and they can give major upside but for that I should be able to understand how to invest in commodity based business.

Since my method focuses more on consistency than market cycle I should also try to learn more about turnarounds.

They explained me why it is difficult to find a turnaround stock in evergreen niche and suggested to look for turnarounds in commodity based business model with exit strategy.

Following are stocks they gave me and I agree with their analysis,

Bannariamman Sugars (Value hasn't yet unlocked)
Balrampur Chinni (Value unlocking just started)
EID Parrt (Forgot what they told but was good)
Goodricke Group (Value unlocking just began)

All are commodity based stocks.

What Was Good About Seminar ?

  1. Learned about few investment options, I wasn't aware of.
  2. Meeting with analyst panel.
  3. Got information to find turnarounds.

What Was Bad ?

  1. Everything was very basic, like for beginners. It felt more like basic investor education than investing training seminar.
  2. Market overview mostly took predictive analysis into consideration.
  3. For new investors the way technical analysis was presented was way too misleading.
  4. Bad examples were used for explanation during seminar.
  5. Couldn't find a very successful investor, neither in panel nor in audience.

In fact I am little disappointed because I have attended many such seminars and I do keep very high expectation. But I can't deny for first timers it was like cherry cake.

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