I have been blogging for quite some time now, though hardly in a regular, disciplined fashion. Here is one more attempt at it, at a impersonal level, to delve into my insights on this quagmire called the Indian Equity Markets.
Result season chaos as usual. Results have been a mixed bag, with good and bad being a fair mix, though people have their guard up and have factored in downsides. Valuations in larger caps have fairly reflected that.
I will delve on results with sectoral insights once the season is fairly complete. For now, a small example which shows how markets have turned volte face over the last 4 quarters.
Aban Offshore is a case in example. A darling of the markets, largest domestic rig player, high quality assets, impeccable management resulted in stock price touching highs of Rs4300 and now its down to 10% of that value. It did everything wrong, plainly put. Right from acquiring Sinvest at the wrong end of the cycle with a high DER to miffing off E&P players which resulted in 4 of its rigs standing idle. With Q4FY09 numbers dissapointing (Rs93cr loss v/s consensus estimate of Rs130cr profits), it has a bleak outlook with 4 more rigs coming out of contract in the next six months. A $3bn debt does not help matters. To add insult to injury, a bullet repayment worth $1bn to Sinvest has to be paid off by December 09. How things have changed. The markets were valuing Aban in excess of 20x 1 year forward earnings are now reluctant to give it even 2x! Macro environment also is not helping out for the company. More on the same in later posts.
A health tip for fitness freaks: if its just one exercise you can do or have time to do...do this...the SQUAT! Contrary to popular perception, it does no just work your hams, it involves everything right from your core (abs) to shoulders, glutes and back. It really taxes you out. Try doing a barbell full squat with 50kgs on your back for 10 reps. I bet you can not on the first try! Take it easy, go slow, first with body weights half squats and graduate to full squats (ass to the grass!) and then with weights, preferably barbells because it is easier to balance on your traps. See your metabolism revving after that!
