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deveshkayal
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   Posted: 13/Apr/2007 at 11:48am |
Over 100% returns for me in Educomp, Thanks to Basantji for great analysis and Kulmanji as long term pays!!!!
I feel at these price, it has already factored in Q4 earnings and to some extent Q1FY08 earnings..
Mr.Educompstock, Reliance Growth Fund does not hold this stock as on 30st March...so dont spread any false statement....
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"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beat the guy with a 130 IQ. Rationality is essential"- Warren Buffett
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basant
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Posted: 14/Apr/2007 at 4:23pm |
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Though I am not being too modest but the gains belong to an
investor who holds it through the pain. If Educomp is a part of a
diversified portfolio it should be held on.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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kulman
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Joined: 02/Sep/2006
Location: India
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Posts: 9319
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Posted: 14/Apr/2007 at 7:16pm |
Devesh, you should thank your own 'emotional stability' for the gains. Bazaar mein, TV channels pe, Forums mein jitne log us se jyaada views rehte hain.
Sometimes I envy you (ooops, somewhere else I mentioned Envy=0 in my equation, anyway this is just to emphasise your advantage) as you've started very early in stocks! When I was your age, I used to......................hmmm.....I should maintain dignity of this forum.
Edited by kulman - 14/Apr/2007 at 7:19pm
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Life can only be understood backwards—but it must be lived forwards
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basant
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Posted: 14/Apr/2007 at 9:33pm |
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Devesh: At Rs 1325 Educomp trades at 25 times Fy 09 earnings. ALways keep that in mind. I was not comfortable with 20 times FY 09 because I had to bet a major part of my portfolio on this but the value of a stock is inversely propotional to the price.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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basant
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Posted: 14/Apr/2007 at 11:05am |
After IOL Broadband, Core Projects is also venturing into this segment.This is one of the biggest problems with businesses having low entry barriers everyone's brother wants to get into it. Unlike Retailing where location has some inbuilt advantage here it is just like another software company.
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nikhil090
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Posted: 14/Apr/2007 at 11:40am |
I think it is a little too early to predict how well these will compete with Educomp. As far as I understand they have different model. IOL is only focussing on giving education through the broadband connection that they will provide and it may be in conjunction with their cable offerings. This will not compete with Educomp except the retail initiatives - which itself is small for Educomp. Dont know much about Core projects so cant comment. Also Educomp is entering into tieups/contracts with school for 4-5 years. that will allow them to build an image etc. Also I feel that the most promising part of their focus is the retail focus. if they are able to build some brand name in the next 1-2 years, it will significantly help them to retain/attract students.. Remember the brand name of IMS/Career launcher/Brilliants/FIIT Jee etc.. Every body wants to join one with perceived "great" education..
However competition has to be watched carefully but it may still deliver outsized gains over long term.
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nikhil090
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Posted: 14/Apr/2007 at 11:43am |
Also the scale of opportunity is tremendous. the first ambition of any parent in India is to provide the best education to their kids.. that will go a long way in ensuring sustainability for all of them..
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basant
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Posted: 15/Apr/2007 at 12:00pm |
I agree about that argument but when I analyse any company I analyse it from the aspect that 100% of my portfolio were invested into this one (no room for error) hence those perspectives (not apprehension). Generally stocks do best when you get a low PE with super normal growth so with Educomp at Rs 260 (when I first got interested). It was 8 times Fy 08 now it is 40 times Fy 08 so there has been no change in EPS just a 5 times rerating of the stocks based on PE expansion.
Stocks always go up on a multiple effect PE expansion (one time) and then EPS increase (sustainable multiyear) so the first and the more important part of the rally seems done "PE expansion" now investors shpould look for EPS increase for any gains.
I refer to this phenomenon as the cream being out of the milk - skimmed milk.
Edited by basant - 15/Apr/2007 at 12:01pm
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