Wednesday, September 22, 2010

Photographers and their portfolio - who use Elinchrom

Legendary photographer, Joe McNally, has shot cover stories for TIME, Fortune, New York, Men's Journal. Numerous cover stories for National Geographic. Described by American Photo as "perhaps the most versatile photo journalist working today". His work finds place in Photo Gallery of US and Archives of Library of Congress. His advertising and commercial clients include FedEx, Sony, GE, Adidas, MetLife besides others.

Relish the pics at

Andy Rouse is King of Kings in domain of wildlife photography.

Feast your eyes on

As per my reading, businesswise and as per feedback of Photographers, Elinchrom has been widening its moat against Profoto and Bowens, 42 and 87 year old companies respectively. Moat has further widened since 2009.

One of fellow investors, readers, MG, has rightly said that its a nice idea to add to positions when they are recognised. I recall having read in 1960s annual letters by Warren Buffett, where he said, "Its possible that for the next 2-3 years we will do nothing other than only adding to existing positions in two companies that we have identified". Thats investing. In a brilliant essay by Andy Kessler, Signposts in the Fog,, he regards investing as not 20%, 30% or 50% gains but 2 - 5 - 10 times gain.

25% compounded several times also becomes multibagger but somehow one person cannot focus on all things at the same time. Varied and multifarious are the strategies and processess for success, as long as they are enjoyable and suitable for one's temperament. Personally, once vetted, I feel no risk when I invest in a 4 crore market cap company, I consider investing in ONGC, Infosys far riskier.

To end with a quote from a great photographer, Ansel Adams 1902-1984, When words become unclear I shall focus with photographs. When images become inadequate I shall be content with silence.

Sunday, September 19, 2010

Elinchrom and competition

I have done sufficient research before getting into it myself and writing about it here. Over next few weeks, I will be posting useful links pertaining to this story.

Some of worlds best photographers vouch for Elinchrom. I have visited dozens of photographers discussion boards and participated in conversation or read their opinion. Top brands for digital studio lighting are Elinchrom, Bowens, Hansels, Profoto, Broncolor. While you will find zealots who love one or the other brand, top two undisputedly are Elinchrom and Bowens. I would add that all top photographers use Elinchrom in one way or another.

Bowens leads in UK because it was founded in UK in year 1923 and has extensive service/repair network. All top brands are over 50 years old. This proves that its not easy to displace leaders, also because market is extremely niche and focussed, Tata or Ambani would not be interested on this size of market.

Elinchrom figures as Mac in aesthetics while others can be kindered to Windows, Linux flavours, Solaris. Bowens also makes high end equipment but they are bulky and heavy. Also, Bowens trailed in remote controlled flashlights for a good number of years. Latest news is that of Elinchrom being ahead of wave with iPad, iPhone, iPod interface while completition is always years behind.

While Elinchrom is expensive, it pays off for discerning professionals. In India weddings are big event and the photo shoots leave a lot fo be desired in this country.

Savour the photographs by some of world's leading Photographers.

Andrew Gransden ranked #1 in above collection does use Elinchrom so do the rest,

So does Marco Grob, who specialises in portraits for celebrities like Obama, Bill, Hillary Clinton, George Clooney and who's who of Hollywood.

List goes on, will post more links later.

Elinchrom has 85% market share in India and other's the rest in high end segment. We need to keep tabs on these numbers, pizza pie itself will grow bigger though with bigger pieces for all foodies.

I am keen to know what photographers/photo studios think about it in your circle. Prabhakar, a friend and fellow investor sent me a statement by one of his photgrapher pals -' Photographer friend said - "I have their studio light and it still works great after 8 years" '


Friday, September 17, 2010

This is the multibagger I was talking about | Photoquip

Ladies and Gentlemen,
I am thrilled to have located a bargain for myself and screened one potentially for some of you, and I am extremely ecstatic to present this before you . Very glad that I sullied my hands and dug deeper into it finally. Name of this enchanting mermerising beauty is Photoquip Ltd. As of today I know of no research report that has been written on this company, nor will be one written for next couple of months atleast. Time to briskly over take slow elephatine walk and institutional apathy to non dividend paying/small cap stocks ! Its current price is 35 Rs and its a buy till 100 Rs with current financials.

Let me explain how I missed this diamond. I have to admit that I am extremely allergic to tech stocks, IT companies, any sophisticated and futuristic technologies. Predicting winners are way too hard in small caps due to creative destruction . Big players can chug along and are easy to predict like Wipro, Infosys and suchlike . That was the reason I could not pick Symphony Comfort Systems early on at 25 Rs levels , and picked only @ 125 coz of word SYSTEMS, its now changed its name though to just Symphony Ltd. I also missed Dhanuka Agritech for same reasons early on in rally, TECH in name and I gave a pass.
Photoquip stuck in my stock screener several times earlier and after cognising them as a technology intensive company I gave them a skip. Recently I tried probing deeper into it and noticed that they are sitting on black gold. Company is worth its weight in Gold.
Photoquip owns most powerful brand for digital flashlights in world for sales in India and exports to its Swiss owner which sells across the globe. The brand is Elinchrom. It would be an understatement to say that Elinchrom is to digital flashlights as Tag Heuer/Omega to watches or Ferrari to Cars. There are only a handful of other brands like Bowens , Alienbees, Profoto and Hensels at the summit of photographic flashlight pinnacle which come close in some aspects of photographic flash equipment . Photoquip have long term relationship with Elinchrom since 1984. It would be rather germane to say Elinchrom is to flashlights what Bugatti or Lamborghini is to Cars or Rolex to watches, Rolex too is a Swiss brand like Elinchrom.
India is ready for luxury flashlights and currently dominated by unorganised sector and ersatz imitations will be on their way out with advent of our schools churning out more professional photographers, new magazine genre, more TV and fashion events. In top end segment Elinchrom has 85% of market share in India and a lions size share globally too. They do have entry level equipment for masses too.
Another venture of Photoquip which is promising is Digital Photo printing thorugh its SNAPZ brand of digital lab. I have not visited India extensively recently but notice this trend very much in western countries where I have visited, Europe, States and APAC too (NZ) 
As Indian market matures, more of Elinchrom's products will be added to repertoire and add to Photoquip's winning streak.
Photoquip is a very well managed company extending beyond Elinchrom brand also, it will take advantage of its unparalleled nationwide franchise network in this niche. I believe promoters have pledged their shares only to load on more shares from open market over the past 4+ years and will take it all the way to 75% maximum permissible limit by SEBI. Needless to say company has very bright prospects ahead.
I have had the privilege to speak with few people in this field including Mahesh Nair and Vivek Divekar from Photoquip. I have dug up many discussion forums across the world in Europe and the US to get an opinion of ace photographers alive. They vouch for Elinchrom brand and my heart would race.

I have to add that products are same as TTK Prestige pressure cooker, as in they last 10-20 years depending on use. Quarterly results can be erratic but story has not even begun. Upgrade cycle of professional photographers and rise in standards will see this going places.  
You're buying a Rolex quality company. Time is on your side in more than one way ! Relax and get a snoring sleep, I know I will, sprinkled with day dreams. I believe we need not worry every quarter, we'll retire rich if we hold it. Quarterly performance may be chequered. However, we'll keep tab on competition and management. While I do not fall in love with stocks, for once I have, pinch me please and wake me up.
While I clearly see doubling of revenues for Globus Spirits, same cannot be said with equivalent certainty for this luxury brand for short term. This is a multi year long term story. I may or may not own shares of this after a year or two and may stop tracking, but its an auto pilot stock. Don't ask me valuations please, look at Timex Ltd's valuation on BSE and in my humble (or perhaps not) opinion, Timex is a decent brand in watches but its a disgrace to Rolex if we compare them. While I dislike getting into expensive stocks like Titan Industries, Shoppers Stop, Zydus Wellness etc that stay pricey. I harbour no doubts that Photoquip is dirt cheap for what its worth, it can become a fairly expensive stock and stay like that. Point isn't whether we will profit from it or not, but how much profit ! Lets wait before its discovered and whether we ride all the way to it being costly. My premise for buying is - Indian story for Photoquip has hardly begun, exponential growth phase is bound to kick in sometime soon. Secondly, brands are key, valuations will follow.

Warren Buffet bought sports magazine many years ago, knowing that for some folks life is not business, wealth, or day job, but its biking, for those buffs motorcyle is meaning of life. If you have found a business where you can increase price by 2% above inflation every year, without capital investment, you have found a wonderful business as in See's Candy. I strongly correlate professional photography with motorcyle magazine analogy.

Any feedback from your photographer friends on this blog is highly appreciated.

Have a profitable investment.
Some sales numbers in context again not to be interpreted with quarterly bias. Trading and manufacturing activity affect margins. In 2009 there was 1 crore
of other income as well.
 Revenues(Rs Crores) Profit after Tax (Rs Crores)
2003 15 0.17
2004 17 0.21
2005 15 0.27
2006 13 0.79
2007 26 1.5
2008 27 1.5
2009 36 6.0
2010 46 4.0


Good Luck

Disclosure: I have bought it between 32-35 levels yesterday and today and have vested interest. Please do your own due diligence before buying. Sold part of Simran Farms into Photoquip. I will be adding more over coming weeks irrespective of direction in price.

Wednesday, September 15, 2010

A Poem from Autobiography of a Yogi


Vanished the veils of light and shade,

Lifted every vapor of sorrow,

Sailed away all dawns of fleeting joy,

Gone the dim sensory mirage.

Love, hate, health, disease, life, death,

Perished these false shadows on the screen of duality.

Waves of laughter, scyllas of sarcasm, melancholic whirlpools,

Melting in the vast sea of bliss.

The storm of maya stilled

By magic wand of intuition deep.

The universe, forgotten dream, subconsciously lurks,

Ready to invade my newly-wakened memory divine.

I live without the cosmic shadow,

But it is not, bereft of me;

As the sea exists without the waves,

But they breathe not without the sea.

Dreams, wakings, states of deep turia sleep,

Present, past, future, no more for me,

But ever-present, all-flowing I, I, everywhere.

Planets, stars, stardust, earth,

Volcanic bursts of doomsday cataclysms,

Creation's molding furnace,

Glaciers of silent x-rays, burning electron floods,

Thoughts of all men, past, present, to come,

Every blade of grass, myself, mankind,

Each particle of universal dust,

Anger, greed, good, bad, salvation, lust,

I swallowed, transmuted all

Into a vast ocean of blood of my own one Being!

Smoldering joy, oft-puffed by meditation

Blinding my tearful eyes,

Burst into immortal flames of bliss,

Consumed my tears, my frame, my all.

Thou art I, I am Thou,

Knowing, Knower, Known, as One!

Tranquilled, unbroken thrill, eternally living, ever-new peace!

Enjoyable beyond imagination of expectancy, samadhi bliss!

Not an unconscious state

Or mental chloroform without wilful return,

Samadhi but extends my conscious realm

Beyond limits of the mortal frame

To farthest boundary of eternity

Where I, the Cosmic Sea,

Watch the little ego floating in Me.

The sparrow, each grain of sand, fall not without My sight.

All space floats like an iceberg in My mental sea.

Colossal Container, I, of all things made.

By deeper, longer, thirsty, guru-given meditation

Comes this celestial samadhi.

Mobile murmurs of atoms are heard,

The dark earth, mountains, vales, lo! molten liquid!

Flowing seas change into vapors of nebulae!

Aum blows upon vapors, opening wondrously their veils,

Oceans stand revealed, shining electrons,

Till, at last sound of the cosmic drum,

Vanish the grosser lights into eternal rays

Of all-pervading bliss.

From joy I came, for joy I live, in sacred joy I melt.

Ocean of mind, I drink all creation's waves.

Four veils of solid, liquid, vapor, light,

Lift aright.

Myself, in everything, enters the Great Myself.

Gone forever, fitful, flickering shadows of mortal memory.

Spotless is my mental sky, below, ahead, and high above.

Eternity and I, one united ray.

A tiny bubble of laughter, I

Am become the Sea of Mirth Itself.

A new (and improved) certain multibagger & Fundraising appeal

Dear all,

I am in the process of shortlising another good pick and potential multibagger, I need to establish contact with management before writing it publicly to be more convinced. I hope to have it out for you in next few days.

If you guys do end up making money from recommendations here and you would like to give any credit at all, I would urge you to donate to a charitable cause that I believe to be noble. Your money is well spent on restoring eye sight of people who cannot afford it. For a 500Rs donation you can get cataract surgery for the under privileged, or sponsor a child's education for 2400 Rs per year.

Please do keep atleast 30% of your funds in FDs at this stage, especially if major part of your material wealth is in stocks. To put things in perspective, if you structure your portfolio with risk averse attitude, you will certainly win in long term, its certain. If you keep all money in stocks, especially if its all liquid money you have, then you will eventually lose. Every 7-10 years a major bear market grips, and if you are 100% invested you'd go down with it, which is fine as long as you can keep adding to positions. If you can't, then you've lost a beautiful opportunity.

To give numbers to the above idea, if you are 100% invested and compound @ 20% for first 9 years and in the 10th year you get negative 15% returns, you lose out to risk averse investor that keeps compounding @ 16% throughout the 10 year cycle.

I am cautiously hopeful of killing sensex next year with out performance, I believe our idea pool is ready to rumble. All credit to One who does not talk about Himself. I actually cannot help but post a poem that is so awesome in the next post.

Kind regards


Saturday, September 11, 2010

Valuation of Mining Companies | OMDC

I spent just 15 minutes googling, binging and came to conclusion that OMDC does not deserve a thumping buy at 2000 Crore market cap. However it has underlying value approximately 2000 crores only thus has limited downside. If demand in China collapses then all commodity companies will suffer.

Following are good links on valuation exercize of mines:

Here is a link of cost of mine sold in Orissa, though this mine can have superior or inferior quality of ore.

12 million tonnes ore = 60 crores

So, 200 million tonnes ore with OMDC = 900 crores only

Another example of iron ore mine sale is

Key statement is "It is also in the process of buying iron ore mines in MP, with estimated reserves of 250 mn tones for about Rs 50 Cr." This values OMDC iron ore reserves at just 50 crores.

Please note, I have not valued manganese reserves etc. as I like to take a broadbased call on such stock with atleast 70% discount. Whilst they do have 800 crores cash in hand, consistent growth is an issue.

My style is to buy companies that will perform soon and reward within next 12 months. However in a likely scenario of systematic risk, a macro event like China bubble collapse, one should buy companies with reasonable certainty of  recovery in 2nd or 3rd year. There too, OMDC loses out.

While the downside is limited for OMDC, I do not feel one can commit any siginificant position in portfolio to it. Value investors can buy some but I wont add it at all. I like to invest in only no-brainers however in frequent their find, at this juncture predicting growth is difficult and its not a no-brainer.

Friday, September 10, 2010

No paid package or services

Dear all,

I have received a few emails regarding paid package for "paid tips". There is no such subscription list or paid service. Its a blog of my thoughts, opinions and ideas which time can prove to be wrong or right.

While I manage money of couple of other folks in mine and in laws family and couple of friends, who do not have inclination towards stock market, but realising  material wealth (money is not the only wealth ;-) ) grows faster in solid organisations than being a nearest source of spare change to Post Office/ Banks, that service is abosolutely free too.

The advantage of this approach is that I do not get blame for bad ideas, loss and profit is always yours. You are also free to avoid my ideas and buy only after your own due diligence. Never buy a stock because its written in this blog. Only accept it as a first level of filter in a stock screener to be applied due diligence by yourself. 

I read other smart investors blogs,  to filter out wheat from chaff, and buy only if I like them.

If we earn wealth from others ideas without applying our mind, that wealth created from borrowed conviction will be fleeting and shortlived, only to be lost later.

But I absolutely eat what I cook for others, unlike professional fund managers, who may not be invested in their own recommendations, and my own skin is in the game directly or indirectly through my funds of my families'.

I hope that we make more money than we lose over time, thats my hope, otherwise its a dis service to society write ideas publicly where loss is propagated beyond one's own wealth.

Good Luck

Kind regards


Globus Spirits is a buy again

While I continue to ride existing holdings of Simran and Relaxo. Globus Spirits should be north of 300 Rs by end of December 2011. I happened to follow up on concall transcript which sounded very bullish. Capacity expansion is more than doubling. Only reason I am not buying Globus Spirits in personal account is because I am expecting Simran Farms to do even better, I might be proved wrong.

Thursday, September 9, 2010

On success in any endeavour

This will be an abstact post not directly related to a stock idea.
I had stumbled on a quotation by a Mumbai based investor, Chandrkant Sampat, which looked like "Only thing an investor needs to be successful is to dream". I could not relate and agree with it. Must have been clear as whistle in respected thinkers mind, but did not stike a cord with me. It seemed over simpification. Nevertheless it struck and stayed with me that I do not concur with this quotation. Afterall, day dreaming does not amount to success.
Analogous situation happens with other folks who arrive at any adroit art with mastery but forget the means and unable to explain complete process. Patanjali had to think and trace back for yonks to explain how he arrived at that mental state before he could pen down Yoga Sutras. Once an ace hitter reaches wizardry in performance, he forgets the circuitous means by which ability was accomplished, art form is expressed effortlessly as breathing or walking.
Recently another quotation I chanced on by Einstein, was completion for the one that I read few months back "Imagination is more important than knowledge". I believe this one is more complete. He also opines that he is not necessarily more scholarly, gifted, sharp or genius, he simply dwells on the problems longer.
I believe dwelling on the issues, asking right questions, ticking off checklist like Pabrai and then pulling the trigger makes for good investing.
Also, investors do not change their styles. Once discipline to avoid scores of bad stock ideas, patience to wait for right idea and judgment of a prospective idea is established, investors do not change their styles overnight. A gradual transition is likely. Patient value investors stay like that, growth seeking investors act differently, traders perform same tricks as work in past. Unlike chameleon institutions which pull out new rabbits from the hat, are best expressed by Groucho Marx, "These are my principles, if you don't like them, I have others".
Update on Positions

Hold on Relaxo Footwear
If one has significant part of net worth in stocks, this would be good time to park 30% in FDs.