India to Borrow and Spend More in 2010-2011

[ramu]

Because the top performers in Mumbai have highly inflated valuations....a result of the extraordinary hype. The real question is whether or how long they can sustain such lofty valuations.

The higher these stocks go, the steeper their fall could be.

Riaz, I seriously thought you have some knowledge about economics.

I am not talking about market valuation which can be in bubble territory.
am talking about book value or the worth of the company based on its [total assets] - [total liabilities] .

Does the term balance sheet ring a bell ?

 

[Mahakaya]

Because the top performers in Mumbai have highly inflated valuations....a result of the extraordinary hype. The real question is whether or how long they can sustain such lofty valuations.

The higher these stocks go, the steeper their fall could be.

OK so please share the reason why you feel they are HIGHLY INFLATED IN TERMS OF VALUATIONS:

Give me one reason on the basis of FUNDAMENTALS to disagree with their current valuation levels , forget about technicals!

So if you say L&T is trading at a premium today and believe it is inflated tell me what reason do you have not to believe that it is correctly valued or undervalued given that in the next 5 years India is planning to spend another 500 billion dollars on infrastructure.

 

[ramu]

You are quoting from a 2005 report.. 5 years old..

Karan, nice observation, but lets ignore that for now. It is no consolation that it is pathetic even if per capita was $5000

 

[karan.1970]

There is quote from member. I forgot his name.

Never argue with an Idiot, they will bring down to their level and beat with their experience.

Thanks for reminding my 1st signature on this forum... I should follow it more often...

 

[Mahakaya]

The best valuation method is the conservatively discounted future cash flow method that requires a deep dive in the books to avoid a Satyam. That's what Buffet does.

So then you just contradicted your own understanding of Warren Buffets principals:

You have been consistently ranting about the Over/Under valuation of a company i.e. relative valuation basis not absolute like DCF or discounted cash flows.

One always triangulates the investment decision using various valuation methodologies - DCF, CCM and CTM

As for DCF - Using DCF in a high growth country is a strict NO NO and is only used to get a basic sense - mostly done for only 2-3 years in the future given the dynamic nature of the markets in such countries!

Investment Principles of Warren Buffett

Please re-read!

 

[Chiru]

The best valuation method is the conservatively discounted future cash flow method that requires a deep dive in the books to avoid a Satyam. That's what Buffet does.

Few posts ago you specified that KSE has potential if (BIG IF) situation in pakistan improves. Now you are saying to discount future cash flow.

You need to fix your mind first.

 

[Mahakaya]

Thanks for reminding my 1st signature on this forum... I should follow it more often...

Few posts ago you specified that KSE has potential if (BIG IF) situation in pakistan improves. Now you are saying to discount future cash flow.

You need to fix your mind first.

Karan, nice observation, but lets ignore that for now. It is no consolation that it is pathetic even if per capita was $5000

Thanks guys!

I think its time for me to go off to sleep - I don't think this guy is worth it and suggest you guys leave him be too!

Cheers!

C u guys tomorrow!

 

[ramu]

Riaz, I seriously thought you have some knowledge about economics.

I am not talking about market valuation which can be in bubble territory.
am talking about book value or the worth of the company based on its [total assets] - [total liabilities] .

Does the term balance sheet ring a bell ?

As long as you evade the questions that come to everyone's mind as investors choosing a developing economy, any claims of KSE better than BSE/NSE is going to be ignored.

 

[RiazHaq]

No they are not.. They are trailing returns for 1 yr, 2yr, 3yr, 5yr, and 10 yr from the present day. You know Templeton uses them too . The choice of your periods however is carefully selected..



You are quoting from a 2005 report.. 5 years old..

Your perf data is deliberately misleading.
Nobody randomly picks peaks to show performance. It's done by calendar years or calendar quarters. Most regular investors in funds do dollar cost averaging to get the best predictable returns.

As to the ADB report, if you bothered to read it, you would know you that it was published in December, 2007, and the data gathering for it started in 2005.

Rather than the simple minded Big Mac index for PPP, the ADB ICP used an elaborate methodology with a basket of 800 items that are actually used by the people in South Asia to other parts of Asia to do a serious evaluation of the purchasing power in specific countries. And it found that Pakistan had higher per capita income than all of its neighbors.

Big Mac has no relevance for India or Pakistan. Most people don't eat Big Macs there....not even lamburgers or veggie burgers. The PPP comps based on it are useless.

 

[RiazHaq]

As long as you evade the questions that come to everyone's mind as investors choosing a developing economy, any claims of KSE better than BSE/NSE is going to be ignored.

I don't expect you or your fellow chauvinistic Indians to accept any facts that show Pakistan in a better light than India.

My posts are to cut through the "India Shining" hype and set the record straight for those who care for real information.

 

[RiazHaq]

Few posts ago you specified that KSE has potential if (BIG IF) situation in pakistan improves. Now you are saying to discount future cash flow.

You need to fix your mind first.

Most of the companies that make up KSE-100 have remained and continue to be highly profitable. That's what matters, not your negative wishful thinking about Pakistan.

 

[RiazHaq]

So then you just contradicted your own understanding of Warren Buffets principals:

You have been consistently ranting about the Over/Under valuation of a company i.e. relative valuation basis not absolute like DCF or discounted cash flows.

One always triangulates the investment decision using various valuation methodologies - DCF, CCM and CTM

As for DCF - Using DCF in a high growth country is a strict NO NO and is only used to get a basic sense - mostly done for only 2-3 years in the future given the dynamic nature of the markets in such countries!

Investment Principles of Warren Buffett

Please re-read!

I think you need to learn more about how detailed an investigation Buffet and co do with the books to verify future earnings potential.

That's why Buffet only invests in low tech traditional stuff where the market is well understood and the future earnings are easy to see.

His biggest investment is in insurance and he can see the flow premiums and the payouts base on pat history and future actuarial calcs.

 

[Chiru]

Most of the companies that make up KSE-100 have remained and continue to be highly profitable. That's what matters, not your negative wishful thinking about Pakistan.

Anyone should not invest with Hope and Emotion. Warren buffect did not tell you?

BTW you contradict what you say few post before.

Can you care to answer why there is not a single Mutual fund or ETF pakistan specific?
Do you think people at wall street are missing the opportunities in KSE. May be not smart as you.

 

[Chiru]

I don't expect you or your fellow chauvinistic Indians to accept any facts that show Pakistan in a better light than India.

My posts are to cut through the "India Shining" hype and set the record straight for those who care for real information.

Here is link

India Rising: The New Empire, Business and Economy Growth ...
News Headlines

Please take time and go through the video.

Do you find anywhere related to pakistan. May be some crap blogs and 2-3 min selective/cut sound bites.

 

[RiazHaq]

As long as you evade the questions that come to everyone's mind as investors choosing a developing economy, any claims of KSE better than BSE/NSE is going to be ignored.

Then why did you quote market caps of these companies?