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Archive for the ‘Data’ Category

Spurious RTI data – 40% vacancy in Mum-Ahd trains

Posted by fairval on November 1, 2017

Today one amazing bit of data has come out, it seems out of an RTI query. Says a news item –

Modi government obviously did not do its homework on the Rs 1 lakh crore project.

According to an RTI query filed by Mumbai activist Anil Galgali on seat occupancy, in the past one quarter alone, the Western Railway is facing staggering losses worth Rs 30 crore in the Mumbai-Ahmedabad sector – this translates to a loss of around Rs 10 crore per month. The WR revealed that in the past three months, 40 percent seats have been vacant on the Mumbai-Ahmedabad route while 44 per cent seats were left unoccupied in the Ahmedabad-Mumbai route.

This was widely reported in all papers, and was today being debated on NDTV. As can be expected, the slant was – So how can a bullet train come on this route?

Amazed at the stupidity of it all – this data is SO OBVIOUSLY incorrect. It appears no one in the media or their expert commentators travel in Indian trains anymore. 40% vacancy? What are they smoking?

I travel on this route often, and I know from personal experience, it is very hard to get tickets if not booked in advance. If this data was correct, I should be able to book a ticket say 4 hours in advance.

So I checked just now. According to the RTI data, there are 32 trains (IRCTC lists 30); of which, quite a few are only for this route (as in, Ahmedabad is the last stop). Some of these –

  • Shatabdi Express
  • Ahmedabad Passenger (twice a day)
  • Suryanagari Express
  • Karnavati Express
  • ADI Double decker
  • Ahmedabad Duronto

Total seats as per RTI data are around 8000 per day

I checked availability for tomorrow. Only ONE out of 30 trains has any tickets. Many are not even accepting booking for Waiting List ticket. The only train which has tickets – 179 – is ADI Double Decker. This again I have noticed from personal experience. This does have tickets often till the last moment. Why so? I guess 2 reasons – it has lot of tickets to offer, being a double decker – one bogie has ~140 tickets, this single train must have 2000 tickets to offer; also the seats are extremely uncomfortable, so maybe people don’t like this train.

But then, 179 out of 8000; that’s 2%. And this is not season. In Diwali season, there was no tickets for atleast a 20 day period. For tomorrow (2nd November), even the twice a day Ahmedabad Passenger has no tickets. And it takes 15 hours 45 minutes, a lifetime!! In contrast, fast trains like Shatabdi or Duronto take 6 hours 20 minutes.

So where the hell does the 40% vacancy come from? And in which Indian train sector is that even possible? Let alone Mumbai Ahmedabad.

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VC/PE deal space continues to see slowdown

Posted by fairval on December 14, 2016

Amount of investment in Indian VC/PE (and angel) space continues to see slowdown. This is from data for Jan-Nov’16 (Source: http://www.indiabusinessreports.com)

vcdealsnov16

YTD amount is just over USD8B, down 38% over last year, while deal count is down as well.

The decline is sharpest in internet based businesses, where investment is this year is just about a third of last year.

Posted in Data, PE/VC, Uncategorized | Tagged: , , , , | Leave a Comment »

IPOs in 2013

Posted by fairval on February 13, 2014

There were 1046 IPOs in major exchanges around the world in 2013, it seems. US accounted for 22% of these, London half of that. While BSE it seems did have 33 IPOs, most of these must have the SME IPOs, since NSE has only 7 to show. Ranks 4 to 8 are all Asia Pacific countries. So Mumbai’s dream of becoming an Asian financial hub are far from reality.

There were 96 new foreign IPOs on these exchanges. India is yet to see one.

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Posted in BFSI, Data, IPO, Markets | Tagged: , , , | Leave a Comment »

Impossibility of predicting earnings

Posted by fairval on January 2, 2014

The interesting thing to note in this chart below is how earnings estimate change over time. For FY14, for example, the EPS estimate (for msci india index) started at 435 and seems set to end at 395, down by almost 10%. FY13 was even worse, with estimates coming down by 16% over time.

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Actual earnings growth was 6-8% FY13 and likely to be less than 10% in FY14 again. While FY15 estimates seem to suggest 17% growth over FY14, these numbers should come down over time. As this blog has written earlier, earnings estimates a year ahead mean nothing, and tend to be in the 18-20% bracket by default. They may eventually turn out vastly different, going up in bull markets and coming down in bear markets. Seems to suggest estimating earnings is an almost impossible task.

Posted in Data, Trends, Valuation | Tagged: , , , | Leave a Comment »

2013 Recap: A tough year for investors

Posted by fairval on January 1, 2014

2013 was once again a bear market for Indian investors. This may not be quite apparent from the headline index: Sensex was up 9%. However, BSE500 was up only 3%. We calculated returns for traded stocks (over 2500). Equal weighted returns come to 4%. These aren’t good returns.

More than Indices, the number we prefer to look at is: Annual Advance Decline. This is what gives the true picture for a retail investor. Only 1 in 3 scrips gave positive returns. Only about 1 in 5 scrips gave a return of more than 15%. Those are very tough odds to make money on. So if you did not make money on your picks last year, now you know the reason: the odds were against you. There was quite a rally in the last 3-4 months of 2013, otherwise the numbers would have looked a lot worse than this.

The markets seem to be following a yo-yo pattern atleast for the last 4 years for which we have data. 2014 could depend a lot on election results. A 3rd front, propped by Congress, cant be ruled out. Modi just may have peaked too early. While there is value in some sectors, rampant inflation, screwed government finance remain dampeners. Interest rates will remain high for sometime. Hope we don’t have taxes going up to reduce fiscal deficits.

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Sep’13 profits down at overall level

Posted by fairval on November 9, 2013

About half the results are now in for the Sep’13 quarter, and the picture is not good. The following table has data for about 1555 companies which have declared results so far.

While there is still double digit sales growth, EBITDA margins are down, and net profit for the whole lot is down 14%. That the indices hit an all time high seems to suggest that market has figured the worst is over.Valuations were certainly cheap by the end of Aug, so some rebound was justified. But with inflation still out of control, RBI stance still aggressive, too early to presume a recovery. Lets see how do the rest of the  results pan out, we will know in another one week,

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Corporate EBITDA’s at 2 decade lows, it seems!

Posted by fairval on October 13, 2013

A recent broker report throws up an interesting insight – the so called increase in ROE’s of Indian companies over the last decade was powered by easy money,  not by EBITDA improvement.

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The 3 lines above may confuse: they are different sample sizes. The black line, which is the oldest data, is ~650 companies. The blue line, is 10 year data and around 1100 companies, grey line has even more companies

If we just focus on the black line, EBITDA margins are the least since 1994! (tho ROE is still higher)

Posted in Data, Trends | Tagged: , | 1 Comment »

IIP slowdown now 17 months, largest by far in 2 decades

Posted by fairval on July 15, 2013

The Index for Industrial Production (IIP) came in at -1.6%. This extends the IIP slowdown to 17 months – that is the number of months IIP has remain below 4% on a rolling 12 month basis (this is admitted an arbitrary definition).

Rolling 12 month IIP went below 4% in Jan’12, and is still far away from emerging from the hole.

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In an earlier post IIP – Is this India’s worst slowdown since 1991?  written in Nov’12. Well, now the answer to the above Q is unequivocal – this is by far the longest slowdown in 2 decades. Note the Sensex PE – it is way too high this time, presumably due to easy money conditions globally.

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Financial savings lowest in some 20 years!

Posted by fairval on March 21, 2013

A recent MS note points out that financial savings have hit perhaps their lowest level since liberalisation. Couple of charts from the note:

Equity market proxy, shows markets are again close to historical lows. In absolute terms, indices have been flat since 2007. So investors have moved away from equities

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Negative real interest rates are the other reason, why areas like gold have gained acceptance

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Posted in Data, Indian Economy | Leave a Comment »

Did real GDP grow only 2-3% in FY13?

Posted by fairval on March 3, 2013

There is a certain calculation we can do from the data the government gives out on its budget day as shown in the table below (an extract from the larger budget table posted in the earlier post).

See row 21 and 22 – that is data reported by the government in its budget. If we divide 21/22 – the number we get should be the nominal GDP (row 25). Row 26 gives the growth rate in this derived nominal GDP. Note that in FY13, nominal GDP growth has dipped sharply to 10.7%. This is dramatically lower than earlier years.

Next we know reported real GDP growth rate from the data Mospi – or Ministry of Statistics and Plan Implementation –  reveals from time to time (row 27). If we substract row 27 from row 26 (not straight arithmatic deduction but compound subtraction), we get a rough estimate of the GDP deflator. For FY13, the deflator comes to 5%, again vastly lower than earlier years. Now i am no economist, and I am told that GDP deflator is not the same was WPI inflation (WPI largely ignore services sector, for ex), but still, a deflator of 5% makes no sense – in an year where inflation has been raging. Also note, in the previous 4 years, the deflator has been more than WPI in 3 of the 4 years (caveat: this is a derived deflator, not what is reported by Mospi).

So the point is this – We have to assume the data in row 21 and 22 is correct, the finance minister declared it. So the rows 25 and 26 have to be correct (even though they are derived numbers – data in shaded rows is derived data). So nominal GDP did grow only 10.7% in FY13. The issue is – what rate did real GDP grow? (to the best of my knowledge, real GDP is derived from nominal by this magic figure – deflator, so it is a very important number). What if the deflator was more than 5%, which it should be. So maybe real GDP grew just 2-3% in FY13.

Derived nominal GDP, and GDP deflator, from Budget data

Derived nominal GDP, and GDP deflator, from Budget data

Such a low GDP growth rate is not outside the realms of possibility. See data for FY14. The government has projected nominal GDP growth of 12.8%, and if we take expected real GDP growth of 6.5% for FY14, then we get a deflator of around 6% as well. Given that inflation is expected to moderate in FY14, shouldn’t the deflator for FY14 be less than the deflator for FY13? This means FY13 deflator has been understated.

In other words, the real GDP growth in FY13 of 5.4% seems overstated

Posted in Data, Indian Economy, Trends | 2 Comments »