Alpha Invesco Annual Letter

Alpha Invesco : Annual Letter 2018-19

Download PDF - Link Annual Letter 2018-19 Dear Partner, 2018-19…
financial shenanigans

Financial Shenanigans : How To Detect Financial Reporting Tricks - Part 5

In the previous set of articles, we have climbed the first two mountains in our quest to conquer financial shenanigans, with one big climb still to come. Until now, we have focused on assessing the performance of companies using two separate metrics: earnings and cash flow. However, our quest is not yet over. In this article we discuss the importance of using other “key metrics” to evaluate a company’s performance and economic health, and we expose tricks that companies could use to cloud the picture and mislead investors.
financial shenanigans

Financial Shenanigans : How To Detect Financial Reporting Tricks - Part 4

CF Shenanigan No. 1: Shifting Financing Cash Inflows to the Operating Section CF Shenanigan No. 2: Shifting Normal Operating Cash Outflows to the Investing Section CF Shenanigan No. 3: Inflating Operating Cash Flow Using Acquisitions or Disposals CF Shenanigan No. 4: Boosting Operating Cash Flow Using Unsustainable Activities
financial shenanigans

Financial Shenanigans : How To Detect Financial Reporting Tricks - Part 3

To inflate tomorrow’s operations, management would simply hold back today’s revenue or gains and accelerate tomorrow’s expenses or losses into the current period. Now you might be thinking why would a company want to report smaller profits? Consider a company that is growing like gangbusters and is unsure of what tomorrow holds, or one that has benefited from a large windfall gain or a huge new contract.
Chetan Phalke, Alpha Invesco

Viewpoint|Three Themes To Bet On As India Moves Towards $4-Trillion Economy

India is moving towards becoming a 4 trillion-dollar economy over the next 5 years. There are 3 broad themes where in equity investors are positioned to do well if invested with a reasonable time horizon. Indian economy stands at a very interesting juncture at this point of time. The economy is just coming out of excess capacities that were created during early part of the decade.
View Point- Inevitable Recovery In the Old Economy Sectors

Viewpoint | The Inevitable Recovery In The Old Economy Sectors

A mere continuation of existing policy framework will unleash animal spirits in the economy over the next 18 to 24 months. Investors should keep this in mind while positioning their portfolios Nobody really knows if PM Modi will win 2019 elections with absolute majority till the last vote is counted. However, given the fragmented opposition across states and lack of credible alternative have led to a situation where odds are in favour of NDA forming the government again.
financial shenanigans

Financial Shenanigans : How To Detect Financial Reporting Tricks - Part 2

Investors rely on the information that they receive from corporate executives to make informed and rational securities selection decisions. This information is assumed to be accurate, whether the news is good or bad. While most corporate executives respect investors and their needs, some dishonest ones hurt investors by misrepresenting the actual company performance and manipulating the company’s declared earnings. Part 2 fleshes out the Earnings Manipulation (EM) Shenanigans which inflate current period earnings and suggests how skeptical investors can ferret out these tricks to avoid losses.
financial shenanigans

Financial Shenanigans : How To Detect Financial Reporting Tricks - Part 1

Enron’s revenue went up more than 10 times in just 5 years from $9bn to $100bn whereas, its net profit was hardly doubled (in 2000 vs. 1995). Clearly something was wrong as it took Walmart - 10 years to go from a revenue of $10bn to $100bn, 31 years to General Motors, 27 years for Ford and 17 Years for ExxonMobil but Enron did it in just 5 years. It was the largest corporate bankruptcy in U.S. history (until WorldCom declared bankruptcy seven years later followed by Lehman Brothers in 2008).
edible oil india

Edible Oil Industry Of India – A Brief Overview

Oil Seed crops are second most determinant category of crops for our agricultural economy, post cereals. The self-sufficiency in oilseeds attained through “Yellow Revolution” during early 1990’s, could not be sustained beyond a short period. Oilseed production is quite concentrated in some states in India. Madhya Pradesh accounts for 27% of the production and top 4 states account for ~80% of the production. Palm oil forms a major share of the edible oil consumed by Indians, with second most consumed oil being Soyabean Oil. Together both sum up to ~65 % to 75 % of our consumption.