Comments on: Finance Friday: How Infosys made Billions – Made Millions for its shareholders too !

By: Anubhav

Anubhav — Thu, 12 Nov 2009 04:16:40 +0000

Another note to look forward to is how much the management believes in the stock, the current CEO is still buying Infosys stock at current price levels which bodes really well. They surely are putting their money where their mouth is.

By: Ankit

Ankit — Sat, 31 Oct 2009 07:05:58 +0000

Danke Sir, kind words like these inspire me.
But then u stuck a valid chord with ur insights.
Yes, Mr.Buffet does not invest in IT businesses, and i will be bluffing if i say he is not smart enough:)
IT can seem a sector where the tangibles are a little unclear unlike Mr.Buffet’s portfolio at large.and since he picks up stakes in the ranges of 5-10% , he has to ensure that the companies he invests do not depend on external factors as much as possible.
But, then given the current times and limited cash, the safest business sector seems the FMCG.
Case in point:

Dont know about any1 but i have been using Parachute cocunut oil all my life.It is a brand that i have grown with and can vouch that the same can be said for a lot of people i knew.There i have a potential tangible understandable business right there..And that explains why i am invested in MARICO for over two years now:) I am unloading my dirty secrets here but the fact is that MARICO has not disappointed me and i see the company selling Parachute for the next 5 years

By: Ankit

Ankit — Sat, 31 Oct 2009 06:58:54 +0000

Thanks Guys for the kind words!! Feels great to be appreciated, but nothing drives me more than critical feedback.So, please bring it on and help me improve:D

By: Gopinath Mavinkurve

Gopinath Mavinkurve — Sat, 31 Oct 2009 05:59:19 +0000

Ankit, a great post indeed! Quite paradoxical however, that Warren Buffet never invested in software companies because he does not “understand the business”! Your last post on the legendary investor’s methods was also very informative for readers. Keep those coming!

By: Arun Prabhudesai

Arun Prabhudesai — Sat, 31 Oct 2009 05:58:31 +0000

yeah…that story has been doing round past many years… heard it many times whenever we talk about Infosys share appreciation stories…

By: Squamble

Squamble — Sat, 31 Oct 2009 03:05:52 +0000

A nice post again Ankit.
It is heard that Mr. Narayan Murthys driver is also crorepati !

By: TIP Guy

TIP Guy — Fri, 30 Oct 2009 15:27:30 +0000

I think many folks get carried away by few examples like Arvind Mills, Satyam, NOCIL, etc. and start believing long term is not good. I am sure there are few more. When investing for long term, the objective should be to grow with the company. If somewhere down the line, the company starts withering, it should be dumped and move to the next one. Purely buy n hold is dangerous, its buy and monitor. Success rates for long term is much much higher.

You should check out few others like NTPC, LNT, ONGC, ABB, etc….

Ankit it was a good read!

By: Arun Prabhudesai

Arun Prabhudesai — Fri, 30 Oct 2009 15:15:07 +0000

Hey Sandeep,
Aha…mixup in millions and crores… I actually read this amount – 28,51,8400 as 28.5 crores and 1.5 cr as dividends (approx), but now I see the problem – I have my foot in my mouth. The commas are in wrong place – It should be 2,85,18,400 (crores) and 28,518,400 (millions).
Extremely sorry on this one…I guess I have done 2 huge mistakes in 3 days.. need to be more careful :)

Anyways, thanks for pointing out – It is 3 crores and not 30 crores !!!

By: sandeep

sandeep — Fri, 30 Oct 2009 14:07:00 +0000

If you multiply 12800 shares at 2228, it equals 28,51,8400/- ( Rs 2.85 Crores and NOT 30 crores ). Are you saying the remaining 28 crores was paid in dividends. Lets get the math staright here before getting too carried away.

By: Ankit

Ankit — Fri, 30 Oct 2009 12:32:28 +0000

@Sriram
Well said Sri. It knows it core strength and plays on it…One possible reason for this is that Mr.Murthy was neva in it to get rich, it was his passion and desire.Not saying that he did not want to make money, he sure has made billions but his dream/passion is what drives infosys and will continue to do so.A man that is total respect worthy for what he has done and for a champion management legacy that he has created.

By: Ankit

Ankit — Fri, 30 Oct 2009 12:26:27 +0000

@ Well said Kiran, a good counter example.
This was a kinda sequel to the post i did on Warren Buffet.the idea here is to stay put for long term only if the company fundamentals are strong.

The ‘Hotness’ of the stock is decided by so called market experts and the the unaware retailer gets lured by it.The whole BUY starts spreading like fire and when it reaches a certain level, the big fish cashes out leaving the others with nothing.

Notice the key phrases here and in the previous post too

1)Company Fundamentals and Management capability of Infosys
2)study the stock further to understand the Intrinsic value at the current price.

Not saying that arvind mills wouldn have had that, but consider this for one minute.Textile is a hugely policy dependent sector, so even with the best of the management, not much can be said.
And again, buy a company which u think can stay afloat for atleast 10-15 years and probably a company one knows the business.
So, long term investment cannot be singled out without considering other parameters
But, liked your example.Interesting and i am already wondering if another post can be made from your comment:)

By: Sriram Vadlamani

Sriram Vadlamani — Fri, 30 Oct 2009 12:23:13 +0000

Great post Ankit!

Important thing to note is, Infosys is a company which believes in organic growth and focus. It did not venture into any other space (except OnMobile) and it did not pursue acquisitions though it had ‘real’ cash.

By: Arun Prabhudesai

Arun Prabhudesai — Fri, 30 Oct 2009 12:22:54 +0000

hahahaha…Man Arvind Mills is such a sad story…I lost quite a bit on that one…

By: Kiran

Kiran — Fri, 30 Oct 2009 12:08:32 +0000

Just to rationalize…and give a different perspective…If you had invested Rs. 10k in Arvind mills, the hottest stock at that time, you would now have Rs. 100 I think – so there :)