Rahul Atyant is a managing director at Atyant Capital and manages the Atyant Capital India Fund. In the last 10 years he has managed money exclusively in the Indian markets. His mission is to consistently identify the best 10-15 investment ideas from among the thousands of publicly-traded Indian corporations. Rahul's value-based investment philosophy stands apart due to his belief in the paramount importance of corporate governance, specifically how management operates with its minority shareholders in mind.
Rahul graduated from the Wharton School of the University of Pennsylvania with a degree in Economics. He lives and works in Chennai, India.
Topic: Prospecting for Compounding Machines in a Minefield of Value Traps
Indian is a rich hunting ground…. Has been discovered over the years.
Indian GDP is growing despite the government in the double digits.
There seems to be a paradise for value investors with a long term position.
Indian is also a minefield of value traps.
“What prevents the price of a stock from converging with its intrinsic value?”
My Framework
Corporate Governance
Stewardship of Capital
Business Fundamentals
Financial Strength
Relative Opportunity
b. How is it violated? The No. 1 way is through related party transactions. Has the company done m/a or given loans on favorable turns to a related company, or taken on undue risk?
c. How to identify mis-governance?
Return of capital to shareholders
Empire building
Vanity
Frequent equity dilutions
Competition-domestic or foreign
Cost competitiveness
Pricing power and price dependence
Distribution strengths
Unique strengths and/or moats.
disclosure: None
http://www.valuewalk.com/
Rahul graduated from the Wharton School of the University of Pennsylvania with a degree in Economics. He lives and works in Chennai, India.
Topic: Prospecting for Compounding Machines in a Minefield of Value Traps
Indian is a rich hunting ground…. Has been discovered over the years.
Indian GDP is growing despite the government in the double digits.
There seems to be a paradise for value investors with a long term position.
Indian is also a minefield of value traps.
“What prevents the price of a stock from converging with its intrinsic value?”
My Framework
Corporate Governance
Stewardship of Capital
Business Fundamentals
Financial Strength
Relative Opportunity
- Corporate Governance — not just fraud or embezzlement
b. How is it violated? The No. 1 way is through related party transactions. Has the company done m/a or given loans on favorable turns to a related company, or taken on undue risk?
c. How to identify mis-governance?
- Stewardship of Capital — $1 of market value for $1 of retained earnings?
Return of capital to shareholders
Empire building
Vanity
Frequent equity dilutions
- Business fundamentals — factors worth exploring:
Competition-domestic or foreign
Cost competitiveness
Pricing power and price dependence
Distribution strengths
Unique strengths and/or moats.
- Financial strength- capital structure
- Relative Valuation – relative to market
- Relative to industry and peers
- Ranking withing funds buy list
- Price history
- Major holders
- Insider transactions?
disclosure: None
http://www.valuewalk.com/
