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. Investors surely would love to see those delicious numbers, but they also would naturally expect management to duplicate or even exceed them tomorrow. Meeting those unrealistically high investor expectations may be virtually impossible, leading management to feel compelled to use this technique. Below shenanigans can be categorized in this subgroup
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.

Indian Defence - Brief Overview On Capital Expenditure & Spending Patterns

India has the third largest military in the world and is the sixth largest spender in defence. In the below write-up, I have tried to put forward basic facts about Indian Defence Sector and how it has evolved over with time. Before I begin with the write-up, I will explain few terms which might be new for some readers: BE – Budget Estimates. When the Union budget is presented in Parliament and passed for the financial year, it’s called the Budget estimates (BE). RE – Revised Estimates. Estimates done in the middle of the ongoing year.
Coal In India

Short Notes From Brookings Report On Coal And Thermal Power In India

Currently the PLFs of the domestic coal based power plants in India are low, which implies lower profits, this has happened because India witnessed growth in supply of power plants at an unprecedented level between 2011 and 2016, the supply of power grew at 14.5% in the period. The PLFs dropped further due to the push of the 2014 elected government to increase power generation via Renewable Energy. More power dispatches started to happen from the RE sources which displaced conventional coal based power. Currently India has ~40 GW of idle power it has no PPAs signed with the DISCOMs or it is in the IBC-NCLT. These newer plants were built mostly by the private companies which are now stuck because they don’t have PPAs or FSA (Fuel Supply Agreements) from Coal India.
REIT India

Can Real Estate Investment Trust (REITs) In India Generate Sufficient Returns For Its Investors ?

Real Estate is one of favorite asset classes for Indians to park their saving. To give a context, the average Indian household has more than 80% of its wealth in Real Estate and other physical assets. A REIT can be viewed as a closed ended mutual fund for real estate with a structure similar to mutual funds i.e. Sponsor-Manager-Trustee. A REIT is funded by its sponsors and managed by its managers with key underlying investment instrument as real estate assets.