Modern Hindu

This is not a religious post unless you live to eat.

There is a dhaba kind of eating place on the 4th floor of a moth-eaten building near Sterling cinema and opposite the TCS headquarters in Fort, Mumbai. Us jagah ka naam hai “Modern Hindu Hotel”.

They operate on the “fixed menu for a day” model like all the thali system dhabas and offer only lunch. Food is essentially South Indian but the ehsaas is completely North Indian. They serve roti, random subzi, rice, sambhar, rasam, dahi, papad, chutney, etc. on a huge banana leaf. Most of the food is usually delicious, though slightly spicy. And if you can eat more than they will be happy to offer more, i.e. the unlimited funda is followed. What I have figured out (like any smart man like me will do) is that you need to be there at 12:30 in the noon unlike 1 PM when most others jam around. This will save your time as you need not wait in a line and the breeze from the open window will be less stinky given comparatively less sweat generated by the fewer guests present (yes you have to climb the stairs).

Inflation is bugging them and their customers too. I have paid Rs 40, Rs 45 and Rs 50 on three visits over a period of not more than 6 months recently. Kul milaake 101% value for money place to have your lunch.

Real estate in bad state – 2

RBI governor, Mr. Y. V. Reddy has hiked the Repo rate by 50 bps and CRR by 25 bps. Repo rate is the rate at which our banks borrow rupees from RBI. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases borrowing from RBI becomes more expensive.

More pain for real estate and more people on your doors with yet another lucrative deal (on papers and spreadsheets of course).

Since I had bought a house sometime ago, even I am going to bear the pain of increased EMIs, however, I appreciate the decision given the uncontrollable inflation. Just hoping that inflation cools down preventing any further rate hikes.

Kabhi Kabhi Aditi

What if the song from JTYJN is translated into English? It still remains a song like the one below:

Sometimes in life, Aditi, someone seems like your own, just like that.
Sometimes Aditi, when they are separated, it seems like a dream.
In such a condition, how can anyone stop their tears from flowing?
And how can someone think everything’s gonna be okay?

Sometimes it seems there is no happiness nor fun left in life
Sometimes it seems every day is difficult, every moment is a punishment
In such a condition, how can someone smile, or be happy and laugh?
And how can they think everything’s gonna be okay?

Think about it dear, how much I love you.
If there are tears in your eyes, I cry too.
I sing, even though I donno how to sing.
Hey Aditi, it’s true that sometimes there is darkness in the entire world
But it’s only after night that day comes.

Sometimes in life, Aditi, someone seems like your own, just like that.
Sometimes Aditi, when they are separated, it seems like a dream.
Hey Aditi, laugh, laugh, laugh, laugh, laugh a little
Or at least just give a little, little, little, little smile.

If you are happy, it seems the world is filled with happiness
The sun emerges from the clouds and spreads life
Hey listen, what the intoxicating wind is telling you
That Aditi, those who are separated, one day do meet again
Aditi, whether you know it or not, flowers do bloom again

Sometimes in life, Aditi, someone seems like your own, just like that.
Sometimes Aditi, when they are separated, it seems like a dream.
Hey Aditi, laugh, laugh, laugh, laugh, laugh a little
Or at least just give a little, little, little, little smile.

Hey Aditi, laugh, laugh, laugh, laugh, laugh a little
Or at least just give a little, little, little, little smile.

Hey Aditi, laugh, laugh, laugh, laugh, laugh a little
Or at least just give a little, little, little, little smile.

Ab to thoda Has de:)

The Dhando Investor

Finished reading the simple yet excellent book by Mohnish Pabrai. I believe its a good read even for those who are not a bit interested in stock picking. He talks about Patels, Mittal, Branson and himself highlighting the common gene of value picking in businesses they have done.

Not too thick also, a one day read.

facebook status updates

A compilation of some weird such updates from my friends. Names omitted for privacy purposes.

XXX is hoping there wouldnt be a particular short term memory loss.

YYY is confounded by subgradients.

ZZZ Jaipur, Bangalore and now Ahmedabad.. all in states ruled by BJP. Conspiracy theories? But then terrorism is a conspiracy!

AAA is excited and also a little scared about the uncertain future.

BBB is Batman tonight

CCC is lost…

I am sure we will have plenty of these

Real estate in bad state

When your job has nothing to do with buying, selling, renting, leasing property and someone comes to you with an opportunity to invest in a lucrative (obviously on papers and spreadsheets) real estate deal, definitely all is not right. And if the number of such deals offered to you rise on a weekly basis, you may assume something is not right with the industry.

Yes, the realty stocks have already been beaten down by the market. Some of them are trading at 70-90% off their peaks. Oversupply, stupendous increase in the prices over the past few years, credit crunch and increasing interest rates have taken a toll on the property market. Banks are not lending, PEs are shying away. The man on the street is the next target.

What should someone do when the builder is promising a fantastic assured return year on year? This he says is exclusive of the appreciation in property prices. Too good to be true.

The flawed assumption is that property prices always appreciate. They don’t. In some cases, it may take years for the sale value to be equal to the cost and you lose on the time value of money. The next big question is on the credibility of the builder. What if he fails to provide you the promised cash flow? You drag him to the court and wait for the hearing to happen when your kids are as old as you are now. By the time, who knows some goons will end up at your door asking you to simply forget that you owned anything.

But, but, but its not that bad always. In fact, the last few years have been great for those who have invested in property. Will that continue is difficult to answer but on a probabilistic basis I have my doubts. Having said that, it may still be worthwhile to look into such opportunities on a case to case basis and use the Dhandho approach of low risk and high returns. Heads I win, tails I don’t lose much. Now thats the tricky part:)

Is the market over-valued?

What has really changed in the past few weeks?

(a) The Oil is still trading at levels much above our comfort zone, so what if it has declined by 15%. Do not investors oversell when oil climbs up assuming it will peak at $200? The euphoria is no less with they becoming over bullish when it starts receding.

(b) We had UPA + Left (semi-reformist). We now have UPA + SP + parties-with-many-riders-on-plate. We have lost some and gained some. What magic will the new combination perform? Elections are due anyways in a short time. The government may in fact take populist decisions forgoing underlying economic impact in the longer term.

(c) Interest rates are where they were. A possible rate hike on 29th July? Why won’t the earnings slowdown for companies take place? Why will the investment growth rate not slow down?

(d) Inflation still needs to be tamed. I must admit the 2 bps decrease (11.89% versus 11.91% previous week) though. Still no where close to RBI’s comfort zone of 5%.

(e) Finally, the news from other quarters of the world is not too great either. Things are in bad shape everywhere.

The status quo has not altered. But the Sensex has jumped because of increased volatility. Up 15% in 2 weeks. It is trading at above 16x trailing PE (assuming Rs 900 EPS, a close approximation to actual numbers) but where is the growth in the earnings going to come from. I am short the Sensex unless obviously Oil goes below $100 a barrel and hides somewhere for a few years.

It may not be a bad idea to buy some OTM Puts (A put option is out-of-the-money when the strike price is below the current trading price of the underlying security. Read here for more details) on Nifty, though with caution. I am cautiously pessimistic!!

Rain rain come again!

people of the land are in terrible pain

O rain, come again!

You like playing games, favorite is hide and seek

it breaks our hopes, makes India’s balance sheet weak

most of us love you in your pleasant form

but no drops this time has been the norm

our friends in vidharbha cherish that each drop

without which they cant grow a single crop

shower some gains

O rain come again!

The sahyadris look beautiful, green and brumous

streams everywhere, clouds everyplace above us

My friend Lota needs to trek and lose some weight

but he is not too happy with your gait

What is life without you my friend, the rain

I know no one can help us here, neither mckinsey, nor bcg not even bain

Shower some gains

O rain come again!

Nice Senti from Dr. Manmohan Singh

Our PM, Dr. Manmohan Singh did not read out his statement, he submitted this copy to Speaker of Lok Sabha Speaker Somnath Chatterjee.

Excerpt from his speech:

“I have often said that I am a politician by accident. I have held many diverse responsibilities. I have been a teacher, I have been an official of the Government of India, I have been a member of this greatest of Parliaments, but I have never forgotten my life as a young boy in a distant village.

Every day that I have been Prime Minister of India I have tried to remember that the first ten years of my life were spent in a village with no drinking water supply, no electricity, no hospital, no roads and nothing that we today associate with modern living. I had to walk miles to school, I had to study in the dim light of a kerosene oil lamp. This nation gave me the opportunity to ensure that such would not be the life of our children in the foreseeable future.

Sir, my conscience is clear that on every day that I have occupied this high office, I have tried to fulfill the dream of that young boy from that distant village.

The greatness of democracy is that we are all birds of passage! We are here today, gone tomorrow! But in the brief time that the people of India entrust us with this responsibility, it is our duty to be honest and sincere in the discharge of these responsibilities. As it is said in our sacred texts, we are responsible for our actions and we must act without coveting the rewards of such action. Whatever I have done in this high office I have done so with a clear conscience and the best interests of my country and our people at heart. I have no other claims to make.”

The full text can be found here.

His next job is due with Bollywood – of Script writer obviously! In Bollywood too by accident! Amar Singh has also become a great actor – Kharbuje (Aby Baby) ko dekh kar Kharbuja rang to badlega hi:)

The Dark Knight

Good but not my type!