KABALI, Creating disruption to theaters.


Kabali, Rajinikanth’s latest movie, while creating history is bringing in some new concepts and changes in the industry. Star hotels have received permission to screen the movie in their premises on large screens. People can have movie experience in the comforts of a luxury hotel, where seating arrangements are expected to run between 200 to 300. JW Marriot and some other hotels have got the permission and many will follow.
What this means to the Industry?
Technology innovation and its approach to disrupt the existing frameworks which had already brought many changes to the media industry will now go through another dramatic shift. Gold class section in the cinema’s will take a hit. Most of the multiplexes have Gold class which are priced the highest with a lot of comforts provided. This segment was giving good amount of revenue to the owners.
Now as people get the experience the luxury comforts of a hotel to watch movies, these crowd will slowly dwindle from going to cinemas and watch movies at hotels, which will bring down viewership and revenue to theater owners. Cost cutting will get in and bring down quality and innovation. This would mean many entry level people who are working in the cinemas for their regular income will suffer unemployment.
Self driven cars are expected to change the way conveyance is now. All the Uber’s and OLA’s will use this technology to become non-dependent of drivers and will show big revenue growth. What about the lakhs of drivers who are getting their livelihood from these sources.
Machines are taking over everything that man is doing. After some time what will man do for his income? All those who own and manufacture these machines along with those who provide technology for these developments will only be earning. There should be consumers for all those products and services that this new machine sources provide. If we eliminate all the income source of people, who is going to be the consumer?
One by disruption is killing human existence.  By way of technology, if machine begins to do everything, who will be the consumer. Soon the segment that is having the power to experience all these disruptions will become extinct as their income levels will also see a drastic fall as there will be no consumers for products and services provided by their businesses, which are their present source of income.
In a couple of decades, man will realize the damage that he had caused himself by going into the thought of disrupting the existing frameworks. While, at that time the damage would have been very high.
Feels bad to write a negative thought when the world is rejoicing the release of KABALI, which has been creating record after record. Companies have declared holiday on the day of release. Tickets are given as employee benefit. Little do they know that this joy is going to bring some very great disasters soon.

Above 3% gain in June 2016.


For the month of June 2016, our markets took a breather from its rally. We had pressures from 2 events which were surprising, Raghuram Rajan exit and BREXIT. While both were shocking, none had any broad based impact on the markets. In BREXIT became an advantage to our markets. Post BREXIT, emerging markets became favorite’s among fund managers & India had an advantage.

In this period of uncertainty our portfolio had an edge. We had a gain of above 3% on our portfolio against the 2.40% gain achieved by the broad based indices.

Good news is that we have achieved this out performance against the benchmarks with only 60% exposure to Equity. Not fully exposed to the market is also an indicator that the markets are in the wait and watch mode yet. Following June and September results, we should see full loading to happen.

SENSEX could manage to be flat for the month, giving a clear indication that front line stocks are yet to show reasonable growth. It is the Midcaps and a selected few among them that are in good strength. Infrastructure sector had begun to show strength; we have about 5% exposure to the Infrastructure, Cement, Construction and Reality sectors. Most of the stocks in this sector have registered good gains.

ARSS Infrastructure has reached 100% gain within 30 days of our investment giving strength to the exposure we have in this sector.

Sugar & Paper along with NBFC’s are the leaders in the current market. Media stocks have shown growth, with the big releases like SULTAN, KABALI etc., to hit the screens this year, the rally here is likely to continue. We have PVR in our portfolio.

Automobile and Pharma exposure in our portfolio is getting considerably reduced. We have used the system rules to move of stocks and the action also eventually coincided with the future developments. There are news that Auto sector is likely to under perform and stocks are getting downgraded. Following the system diligently helps us be in the right sector at the right period and this has largely helped us outperform all the benchmarks.

Look forward to more fireworks in price moves in the coming months.

SENSEX stocks of 2020.

classic350_right-side_blue_600x463_motorcycleIndia is the world’s best economy today. Following its robust journey that is going to come up in the next 5 years, there is going to be a dramatic shift in the whole economy and with it even the economic barometer of India, the SENSEX. The SENSEX will also undergo change by replacing some of its constituents. Those stocks that will take a space in the future index will be the stars of the markets in the next 5 years.

What if we can identify them and be invested in them?

The growth those companies will have is going to be tremendous and the potential for profits will be equivalent. The expected stocks that can move in to the SENSEX, the list is big with some new not yet listed companies too. Though for the new ones we may not have a direction, for those that are existing, and if identified and invested, can give great gains.

Some of the company’s whose are likely to move in are: NESCAFE

EICHER Motors (Royal Enfield Bullets)

Page Industries (Jockey and Speedo brand products)

TITAN (Watches and Jewelry)

NESTLE and the likes.

Companies that have premiumisation as their focus are likely to shine bright. So, look for premium products in the market and the companies that produce them and be invested in them, chances are you will end up having a goldmine.

jockey-logoAt present our portfolio contains the first 2 names and we have been holding them for quite a long period, in these years that we have owned these businesses, they have showed continuous growth in their sales as well as profits. If they continue the same for the next 5 years, we will still have them. While, there is no guarantee that it will be so.

In the last year, there were some companies that made it big on their growth and become the darlings of the market. Some of the best ones are

Ashok Leyland, Britannia., HPCL, Baja Finance, Ramco Cements, Maruti, TCS, Ultratech Cements, PVR & Kotak Mahindra.

And there are a next set of business that are showing signs of reaching for the best. They are Canfin Homes, TCI, Tata Motors, Orient Cement, Persistent, Heritage Food and BHEL.

These were the names that have come up in the ET500 listing.

Among the above names we are invested in about 7 businesses, while we have doubts on some like BHEL, TCI etc., while if they qualify our parameters in the future we will definitely look at adding them in our portfolio.

By being invested in the best performing companies, our portfolio is managing to grow the best. Last year we had an Alpha of 63% against the NSE 500 Index, This year in the first half, so far we are at 28% Alpha against the NSE 500.

We will continue to grow in the same manner adhering to the best practices and innovative thoughts.