Finding Stocks that are backed by right management
Dr Vijay Malik, a popular writer on stocks, shares his insights on assessing management quality in a Moneylife Smart Savers seminar
 
Moneylife SmartSavers organised a session 'How to Assess the Management Quality before Buying Stocks'. Dr Vijay Malik, (whom Prof Sanjay Bakshi calls 'Dr Stock' because he is a qualified physician who can check the health of stocks) gave his valuable insights on assessing management quality. Dr Vijay Malik, a rigorous stock picker, who spoke in public for the first time, enlightened the audience with his methods at this session conducted at Walchand Hirachand Hall, Churchgate, Mumbai. 
 
Assessing management quality is one of the critical decisions while buying a stock. It assumes great significance for retail investors as they have extremely limited influence on the company's management. Retail investors are compelled to accept whatever decisions are taken by the management. Despite the fact that evaluating management quality is important, this aspect is frequently overlooked by the investors. Given these reasons, a session on assessing management quality was warranted. 
 
The session started with Debashis Basu, director of Moneylife Smart Savers, giving a quick overview sharing several examples on how management quality cannot be decided by simply judging news and events with a short-term impact. Dr Vijay Malik with a unique combination – MBA, MBBS, stockpicker and biker – delineated different aspects of management quality. With real-life case studies, he explained how profits/cash flows of a company could be diverted to the promoters and related parties, defrauding other shareholders of their rightful share of profits. He delineated different aspects of management quality, carefully enlightening the engrossed audience on how to distinguish between good and bad managements. 
 
He explained how a simple Google search could highlight management quality issues. Highlighting the importance of reading Annual Reports, he said, “If certain information that is required for taking investment decisions is not present in the Annual Report, it raises questions relating to the intent of the management.” 
 

He repeatedly emphasised throughout the presentation ' In management assessment, run at the first sign of trouble.'
 
Remarking 'Equity investing is a faith in management', Dr Vijay Malik summed up the different aspects of management quality. 
 
The session ended with a Q & A answer session between Dr Malik, Mr Basu and the audience moderated by Sucheta Dalal, director of Moneylife Smart Savers.
 
Dr Malik patiently answered questions concerning pledging of shares, warrants, promoter holding and contingent liabilities. Emphasising the importance of reading Annual Reports, he remarked lightly, 'Have a big cup of coffee when you read an Annual Report!’ 
 
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    COMMENTS

    Sameer Wakude

    3 years ago

    Hi, I have paid the amount and replied to your email. Can you please grant an access to the video? More details in my email.

    Sameer Wakude

    3 years ago

    Hi,
    I would love to watch this video. I see that it's a private video on youtube. Is there any way, I can watch this video. Would love to pay to get this gyan. Thanks in advance :)

    Sameer Wakude

    3 years ago

    Hi,
    I would love to watch this video. I see that it's a private video on youtube. Is there any way, I can watch this video. Would love to pay to get this gyan. Thanks in advance :)

    Haresh Nagpal

    3 years ago

    I am interested in paid video/webcast of this session .

    sanjay

    3 years ago

    Can I have video of the session?

    sanjay

    3 years ago

    Can I have video of the session?

    sanjay

    3 years ago

    Dear sir,
    Myself Sanjay from Ahmedabad. I read your session on web. It's really eyeopener and enabler as well for small investors like me. Many thanks for your efforts.
    Moreover, Can I have video of this session?

    Regards,
    Sanjay Sagar,
    8000655775, [email protected]
    Ahmedabad

    Prasanna Sampath

    3 years ago

    Can you please do a paid live webcast such events so that we do not need to travel ?

    Darshan Parikh

    3 years ago

    Can you make a video available of this event?

    Ashish M

    3 years ago

    Would love to attend such events but can't fly to Mumbai for each event.

    Please do share video of this event and other such events. We are ready to pay.

    Ravi Kumar

    3 years ago

    Sir,

    please share the video of the above event

    Ensuring Safe Transactions: Mobile, Internet, ATMs, Ecommerce
    Explaining best practices for making online transactions safe and secure, Yogesh Sapkale, emphasised that unless you follow certain rules and are learn to be vigilant, no software or mobile app can protect you
     
    "Online transactions and shopping through mobile or personal computer (PC) or laptop are fast becoming way of life. No doubt it makes like easy. However, if you want to take advantage of technology, you need to follow certain rules," said Yogesh Sapkale, Deputy Editor of Moneylife. He was speaking on "How to be Safe & Smart in Digital Financial Transactions" at Moneylife Foundation which explained how some basic safeguards could allow people to benefit from technological advances without falling prey to scams, viruses and malware.
     
    He said, "No software or mobile app can protect you if you are not careful. Whether you are using Internet for browsing, checking emails or online transactions you need to follow certain rules. It applies while using mobile phones and ATMs as well." 
     
    Mr Sapkale started the session with mobile security, what apps to download or install, how to save contacts and the importance of having an emergency (ICE) contact number in the mobile. "This (the ICE number) will help in case something happens with you and your near and dear ones needed to be contacted. You can save number with ICE prefix, like ICE Rahul, ICE Pankaj and so on."
     
    Mr Sapkale offered an interesting solution to those who keep their phones locked.  "Locking your mobile is a good thing to prevent unauthorised usage. But it becomes problem in case of emergency, especially if you are knocked out in an accident. A person who wants to assist you or contact your kin is unable to access details from a locked phone". His solution was this: Almost all mobile devices allow you to post owner information on the locked screen. Instead of posting your name under this, add the mobile number of the person who should be contacted in case of emergency. Use the prefix 'ICE' (in case of emergency) or 'Emergency' followed by the mobile number of the person. You can add the name of the person if you wish. You can also add more than one number, but use mobile numbers instead of landlines: ICE 9876543210 or Emergency 1234567890. This will help others to help you."
     
     
    He then told the audience how one could block spam or unwanted calls and messages using apps like TrueCaller. Such apps would get access to your contact list, but it also helps in identifying the caller, he said, adding, for this, TrueCaller needs to have access to internet or you need to keep the data connection, preferably 3G and above on.
     
    Mr Sapkale also informed the audience about precautions to take while handing over you mobile for repairing or while selling it to someone else. Emphasising on regular backups, he advised the audience to sell or dispose of mobile only after taking all back up and resetting the device to factory setting.
     
    He then offered some safety tips for using internet banking and financial transactions. He said, "Do check the encryption level of the URL which you may be accessing, especially for financial transactions. There should be an additional 's' in the address bar, like https. Also check for the lock icon in the address bar. This denotes the security level and should display the website's security certificate after clicking on the lock icon."
     
    Since several banks provide virtual keyboard for online banking, one should use it, especially if you are accessing it from a public PC, to avoid user ID and password from being stolen through key loggers. Same thing applies when you are using a free Wi-Fi connection, which makes your data vulnerable and one should avoid it, he added.
     
    For financial transactions, Mr Sapkale said, "Avoid clicking on any link, icon like 'submit' button on screen, unless you have initiated the session."
     
    He went on to explain safe practices for using emails, precautions while downloading attachments, and how to identify spam or phishing mails. "For a safer side, check if your email service provider allows you to opt in for double check-in. Here one check is your password, and the other could be a one-time password (code) as SMS or conveyed through a phone call," he advised. 
     
    Talking about security for personal computer (PC) or laptop, he said, "You need to have a robust anti-virus and an anti-malware software. Several free softwares perform similar to or even better than the paid ones. Also do opt for software updates and, especially for Windows, install patches. Regular software updates ensure you get the best performance, better life and new, useful features. Most importantly, they increase the security of your device by patching the bugs or holes that may make your device vulnerable to attacks or virus and malware."
     
    Passwords play an important role in online transactions and thus we need to pay extra attention for creating and keeping it as a secret. "You should create passwords and codes or PINs that are hard to guess but easy to remember (only for you). For general sites, which do not affect you personally or financially, use simple, memorable phrases, to create passwords. Reserve your strongest, most distinct passwords for critical services-like your bank account, your computer, personal e-mail and social media sites."
     
    "Never share your passwords with anyone. Create passwords using memorable phrases; mix it with numbers, special characters. Never use a word from a dictionary, either as base or password. Feel free to mix languages. For financial transactions, I would suggest a password with a length of at least 13 characters," Mr Sapkale advised.
     
    He also explained, how using the keypad of old mobiles, one can create combination of PIN for ATN, debit or credit card. Talking about safe practices for using such cards, he said, "Never reveal you PIN to anyone. Also cover the keypad with your hands while entering your PIN, either at any shop or at ATM centre. Do not let your card out of your sight. If at a merchant site, the payment machine is elsewhere, either accompany the retailer or request they bring it to you. Check your credit card statements and contact your bank if anything looks suspicious."
     
    Mr Sapkale, then took the audience through online shopping transactions. "Shop only based on your needs and not on impulse. If you are planning to buy an item, then bookmark or add it to cart instead of direct buying as it may save you some money later through an offer or special sale period. Also opt for cash on delivery (COD) and open the package in the presence of the delivery person to check if it is same as you ordered. In addition, while ordering an item do check its total price, including delivery charges. Sometimes, your neighbourhood shop may be selling this item at much lower price compared with the total cost of online ordering," he said.
     
    In his concluding remark, Mr Sapkale said, "Never reveal mobile numbers, credit or debit card number and its security code or any other personal detail related with your financials, especially over phone. Never click on any unfamiliar link received either through social media or chat programs or via email. Do check the encryption level of the URL which you may be accessing and do not share your mobile number or email ID in public forums."
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    BMC Budget: How citizen participation can increase accountability
    Prof Avkash Jadhav's presentation explained why every Mumbaikar needs to know how her money is spent and intervene actively by questioning the BMC to ensure effective governance and better policies and facilities for citizens
     
    The size of the Budget for Municipal Corporation of Greater Mumbai (MCGM) or BrihanMumbai Municipal Corp (BMC) is more than several states of India; in fact, it is the biggest and richest municipal corporation in Asia. The BMC budget for FY2016-17 is a whopping Rs37,052 crore, up from Rs33,514, previous year. What stands out in this Budget is, while several other public bodies pay interest on loans they have availed, the MCGM earns a fat interest from fixed deposits, says Prof Avkash Jadhav, who is Shiv Sena's nominated councillor in the municipal corporation. He was speaking at Moneylife Foundation on "Unravelling the BMC Budget: For citizens' Participation" along with Mr Ashok Datar, a well-known activist. 
     

    Does the large sum of money lying idle in fixed deposits represent prudent policies or inefficient use of funds, was a point of divergence between the two speakers. Mr Datar, who spoke earlier (Read: BMC Budget: Only outlays and not outcome) contended that it was inefficient utilisation, however Prof Jadhav's view was that the money was required for contingencies and because the state government is often tardy in releasing funds due to the Corporation. Citing a newspaper report, Mr Datar said the BMC deposits in 18 banks are worth over Rs51,000 crore and it earned an interest of Rs2952 crore for FY2015-16. 
     
    Prof Jadhav's talk repeatedly brought out the BMC's dependence on the state government and its interference in what should be entirely the decision of the local authority. Starting from the per capita open spaces available to citizens, where several decisions pertaining to large tracts of land, including mill land are with the state. In fact, even all the sodium vapour lights on Marine Drive, a heritage precinct, were changed from sodium vapour (costing just over Rs19 lakh for 644 lamps) to white LED bulbs, which involved a cost of over Rs1 crore without following basic procedures like a discussion with the municipal authorities as to who will bear the higher cost, or studying the lighting requirement of the precinct or calling a tender to get the best price to supply the bulbs. He told a shocked audience that MCGM's permission was not even taken to change the bulbs, when this is something that is squarely in the domain of the local authority.
      
     
    Citing several examples of disparate treatment from state and central government to MCGM, the Councillor said, "Main issue is they do not understand the difference between a normal municipal corporation and MCGM, which is the largest across Asia and have a Budget that surpasses several states. Therefore, the allocations, it at all, provided by the state and central governments to Mumbai are sometimes very small compared with what MCGM actually spends. For example, the central government has allocated Rs500 crore over five years for first 20 cities under the smart city project, while MCGM spends over Rs1,900 crore just on education." 
     
    He also pointed out that such tussles between the local body and the state government over release of funds in a timely manner that could have implications in the future, when it comes to compensating MCGM for revenues from Octroi (over Rs7,000 crore ) when GST is introduced. His comments indicated the communication gap that continues to exist between centre-state-and municipalities even when there are an alliance government at all these levels.
     
    "The MCGM earns its main revenues from Octroi, which for FY2016-17 is estimated at Rs6,895 crore or 27% of the total earnings. The interest earned by MCGM is around Rs2,007.84 crore or around 8% of total revenues earned. However, with the impending goods and sales tax (GST), the Municipal Corp may lose out on its revenues from Octroi collection," he said.
     
    "There is a huge downfall in Octroi revenue earnings for FY2015-16," Prof Jadhav, said, adding, "the Budget estimate for Octroi income was Rs7,900 crore, however till 21 December 2015, the earning is just Rs4,737.48 crore. Considering the average daily earning of Rs21.02 crore, there would be a deficit of Rs1,250 crore on Octroi collection for FY2015-16."
     
    According to the Councillor, the main reason for this downfall in Octroi income is drastic fall in crude oil prices across the globe. Mumbai has two refineries and the MCGM earns Octroi on every litre of crude oil entering into the city.
     
     
    Prof Jadhav cited several examples where simple interventions or notice of motion by him as an individual basis had led to key changes in governance. One of these was that corporators and administrative staff who go on study tours should submit a tour report about their learnings and how they could be used to improve governance in the city. (Read: Shiv Sena Councillor wants reports on study tours to be published
     
    Since Prof Jadhav, a nominated councillor from the Shiv Sena, came through as a concerned and activist councillor, who has effectively used his role as a teacher to explore city related issues in depth through around 25 surveys done by his students. These have covered making Sanjay Gandhi National Park a 'no plastic zone, usage of skywalks in Mumbai city, survey on depletion on mangroves, e-waste, public transport, railways, solid waste management, safety of women in public transport and standard of higher education in India. 
     
    The Municipal Corporation is passing through a financial struggle phase, he said, adding that even the Budget estimated earnings from development plan department is cut by Rs1,091.38 crore to Rs4,732.44 crore from Rs5,823.82 crore for FY2015-16.
     
    Prof Jadhav said, "For FY2016-17, there is an increase of 8.4% in revenue income to Rs20871.54 crore. However, this is due to estimated increased revenues from granting additional 0.5 FSI (as against 0.33) due to amendments in Development Control Regulations and the Ready Reckoner rates."
     
    "Our first priority should, therefore, be to ensure financial stability so that shortage of resources does not mar the developmental works in future. Accordingly, as a part of long-term policy, it is necessary to increase the contributions to the various funds as well as to create new funds. We need to ensure that the pace of infrastructure development and delivery of civic services is maintained by making our operations cost effective and achieving higher operational efficiencies," Prof Jadhav added.
     
    Talking about the need for administrative accountability, the Councillor said we need to upgrade skill set of MCGM employees and engineers with great emphasis on in-house training with suitable outside intervention, besides using the SAP HR module.
     
    "As per the provisions under the Right to Services Act 2015, total 14 services from health, development planning, hydraulic engineer, sewerage operations and fire brigade of the MCGM have been notified and the detailed time frame for providing services, required documents and responsible officers has been published. We have already provided 12 services online and intend to make all services online in the financial year 2016-17," he added.
     
    The Municipal Corporation is also planning to provide property tax collection through banks, Prof Jadhav said. At present, citizens can pay their tax or pay bills through mobile or web and at the citizen friendly centres of MCGM.
     
    The MCGM has recently undertaken major reforms to speed up grant of building permits, the Councillor said, adding, "The building industry not only creates housing stock for the city but also generates over Rs4,500 crore annually in revenues for the MCGM. The building permit process has been recast by reducing number of permissions required and making the system transparent, predictable and fixing responsibility at various levels. This is an ongoing process and in the current year, we intend to completely IT enable it and generate reports to facilitate better monitoring and greater transparency."
     
    The Municipal Corporation of Greater Mumbai has a long history of providing quality health care, which includes primary, secondary and tertiary health care facilities. Some of these Hospitals are 120 years old. Presently the health service is providing health care to 140 lakh patients on OPD basis. The MCGM is the only Municipal Corporation in India running four medical Colleges and one dental college including the newly started Hindu Hrudaysamrat Balasaheb Thackeray Medical College, at Juhu in September 2015 with intake capacity of 150 MBBS students.
     
    The discussion on the budget was followed by an interesting dialogue between the speakers and a wide range of activists and journalists and persons with political affiliations as well as those with purely civic concerns. 
     
    Many urged Prof Jadhav to use his good offices to get support for more transparency and accountability in the functioning of the corporation through the use of technology, mapping and geo-tagging of the city and its service contracts and various apps that have been developed, but which do not receive much response from the MCGM.
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    COMMENTS

    venkataramana pakam

    3 years ago

    pls send me video link

    J Pinto

    3 years ago

    It is a well known fact that when Home Guards took over the Octroi Nakas the daily collection doubled.

    Had that been accounted for the BMC would have had 100,000 or maybe 200,000 crorers crores in the bank instead of 50,000

    If this money was spent Bombay would be look a little more like Shanghai.

    SRINIVAS SHENOY

    3 years ago

    The good road building process, I Felt should have been discussed in depth, as it is the infrastructure development which is the key to the rapid development of Mumbai. The award of contracts to the right road contractors is extremely important and the tainted contractors should be permanently blacklisted. I feel the above point should have been suitably highlighted. Anyway to be fair it was an interesting topic of which I had very little knowledge.

    manoharlalsharma

    3 years ago

    Nice to followup the steps brought by AAM AADMI party from DELHI,but the scenario in Maharashtra is no match because Non-Cooperation among legislators/corporetors/M.L.A./M.L.C because the concentrated to chain instructions no time to ASK the public once election is over business starts to GRAB fundamental RIGHTS of common MAN no one listen.

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