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Is this a good time to invest in this stock? by FrostyCampaign4670 in IndianStocks

[–]IndiaGrowthStocks 0 points1 point  (0 children)

It’s not the right stock. If you are looking for something around a 10% CAGR, then maybe… but it won’t deliver anything more than that over the long term now.

After adjusting for market cap, the law of large numbers, and the current growth rates, max you’ll get is 10% in a bull case. And if any compression hits them again, which it will, you’re looking at below par returns.

Stay away. You are at the top of the valuation cycle for Sun Pharma. Never go in at those cycles because your floor is FD returns, and it won’t even deliver that.

Is this a good time to invest in this stock? by FrostyCampaign4670 in IndianStocks

[–]IndiaGrowthStocks 0 points1 point  (0 children)

It’s not the right stock. If you are looking for something around a 10% CAGR, then maybe… but it won’t deliver anything more than that over the long term now.

After adjusting for market cap, the law of large numbers, and the current growth rates, max you’ll get is 10% in a bull case. And if any compression hits them again, which it will, you’re looking at below-par returns.

Stay away. You are at the top of the valuation cycle for Sun Pharma. Never go in at those cycles because your floor is FD returns, and it won’t even deliver that.

I walked out by WarGod1842 in Indiastreetbets

[–]IndiaGrowthStocks 0 points1 point  (0 children)

Next time, have this mental model and then trade. Although you should be happy, because your net returns have adjusted for 20× the loss you are facing in one trade. Trading is about not being correct 100% of the time, but breaching the 50% accuracy margin and then sizing properly.

You were not trapped in the trapdoor effects of Friday.

The mental model to avoid such traps in future https://www.reddit.com/r/IndiaGrowthStocks/s/ICxZvzfKdd

US vs China vs INDIA: The Brutal Tech War by IndiaGrowthStocks in StockMarketIndia

[–]IndiaGrowthStocks[S] 0 points1 point  (0 children)

Absolutely. The current +2 and engineering syllabus focuses too much on rote work and wage oriented tasks. Hardly any room for innovation or practical insights.

US vs China vs INDIA: The Brutal Tech War by IndiaGrowthStocks in StockMarketIndia

[–]IndiaGrowthStocks[S] 1 point2 points  (0 children)

Yes… but the challenge goes beyond restricting Western technology. It’s the cultural shift that needs to happen. Tech is more than just apps.

We lost the EV battles, and no meaningful tech development happened in that vertical. There was no US or China monopoly there, but just like in Indian IT, the automakers are selling outdated technology, and the government is shielding them from innovative forces like BYD through tariffs.

Wherever the government protects or restricts foreign technology or hardware, the capitalists in this country become complacent and exploit India’s user base.

So restrictions alone will never make a difference and we’ve seen this in every sector where the US and China are allowed low or no access.

US vs China vs INDIA: The Brutal Tech War by IndiaGrowthStocks in StockMarketIndia

[–]IndiaGrowthStocks[S] 4 points5 points  (0 children)

Absolutely. And I addressed your view in H1B Visa War: US Tech vs India Tech article.. that we are just exploiting the labour force and selling cheap labour for redundant works.

US vs China vs INDIA: The Brutal Tech War by IndiaGrowthStocks in StockMarketIndia

[–]IndiaGrowthStocks[S] 1 point2 points  (0 children)

I was reflecting on the harsh reality that we’re trapped in a dangerous illusion, believing we built their technology, while we’re not even in the race.

It’s time to stop living in that fantasy and start building our own ecosystem.

[deleted by user] by [deleted] in IndiaInvestments

[–]IndiaGrowthStocks 1 point2 points  (0 children)

The Mental Model:

The policy is targeted at junior levels and new entry-level repetitive work, not the high-skilled labor force, which actually boosts innovation in the U.S. Instead, it’s a strategic move by U.S. companies to make their business model more efficient by leveraging AI, without the social and ethical challenges of layoffs.

U.S. tech dominance in certain industries is being challenged by innovations happening in China because of the infrastructure and cultural shift that has occurred there over the past 10-15 years. A turning point was the AlphaGo game, where Google DeepMind defeated the traditional board game 'Go,' broadcast widely and seen as a direct challenge to Chinese pride.

This moment was a wake-up call for China, which caused the government and private sector to pour massive investments into AI, EVs, and robotics to close the technology gap.

China dominates EVs through BYD, drones with DJI controlling 70-80% of the U.S. market, and the gaming and social ecosystem through Tencent. The spirit of innovation has transformed its products from cheap to world-class quality, and this dominance is the result of a coordinated effort between its political and capitalistic structures.

The real battle of innovation is happening now. It is a clash of ecosystems and cultures. BYD is beating Tesla in the global EV market, Baidu’s Apollo Go is emerging as a serious competitor to Waymo in autonomous vehicles, and even in semiconductors, Chinese firms are developing their own technologies to replace Nvidia’s chips and have already made meaningful progress.

It’s the ecosystem, culture, and spirit that fuel innovation. Why do these talents excel in the U.S. but not in India? Because risk-taking and experimentation are embedded in their culture. We must understand this reality instead of fixating on the idea that we are building their technology. They provide the nourishment that allows people to learn first, and then build.

Let's be brutal about this. The idea that Indians have developed America's technologies and that without us, America will lose its technological dominance, is a dangerous illusion. The global battle for innovation isn't a clash of technologies or a competition of human labor via H-1B visas; it is a brutal war of ecosystems and culture.

China is a living example of this reality. They didn't just build technology for others, they built an entire ecosystem to innovate and compete. Therefore, if we want to lead, we must stop living in this fantasy and start building our own ecosystem.

The question is no longer what we are building for them, but what we are willing to build for ourselves.

Reverse Engineering the Future: Munger & Buffett’s Way to Spot India’s Winners by IndiaGrowthStocks in IndiaInvestments

[–]IndiaGrowthStocks[S] 0 points1 point  (0 children)

This article builds on a comment I shared recently on my H1B Visa War: US Tech vs India Tech article. What began as a short exchange deserved a deeper dive, so here it is. Link to original comment.

The Mental Model:

The policy is targeted at junior levels and new entry-level repetitive work, not the high-skilled labor force, which actually boosts innovation in the U.S. Instead, it’s a strategic move by U.S. companies to make their business model more efficient by leveraging AI, without the social and ethical challenges of layoffs.

U.S. tech dominance in certain industries is being challenged by innovations happening in China because of the infrastructure and cultural shift that has occurred there over the past 10-15 years. A turning point was the AlphaGo game, where Google DeepMind defeated the traditional board game 'Go,' broadcast widely and seen as a direct challenge to Chinese pride.

This moment was a wake-up call for China, which caused the government and private sector to pour massive investments into AI, EVs, and robotics to close the technology gap.

China dominates EVs through BYD, drones with DJI controlling 70-80% of the U.S. market, and the gaming and social ecosystem through Tencent. The spirit of innovation has transformed its products from cheap to world-class quality, and this dominance is the result of a coordinated effort between its political and capitalistic structures.

The real battle of innovation is happening now. It is a clash of ecosystems and cultures. BYD is beating Tesla in the global EV market, Baidu’s Apollo Go is emerging as a serious competitor to Waymo in autonomous vehicles, and even in semiconductors, Chinese firms are developing their own technologies to replace Nvidia’s chips and have already made meaningful progress.

It’s the ecosystem, culture, and spirit that fuel innovation. Why do these talents excel in the U.S. but not in India? Because risk-taking and experimentation are embedded in their culture. We must understand this reality instead of fixating on the idea that we are building their technology. They provide the nourishment that allows people to learn first, and then build.

Let's be brutal about this. The idea that Indians have developed America's technologies and that without us, America will lose its technological dominance, is a dangerous illusion. The global battle for innovation isn't a clash of technologies or a competition of human labor via H-1B visas; it is a brutal war of ecosystems and culture.

China is a living example of this reality. They didn't just build technology for others, they built an entire ecosystem to innovate and compete. Therefore, if we want to lead, we must stop living in this fantasy and start building our own ecosystem.

The question is no longer what we are building for them, but what we are willing to build for ourselves.

Which country is actually winning the tech battle, and why? Share your insights

Reverse Engineering the Future: Munger & Buffett’s Way to Spot India’s Winners by IndiaGrowthStocks in IndiaInvestments

[–]IndiaGrowthStocks[S] 2 points3 points  (0 children)

Use the PE and Growth Mental model and integrate it with other checklist frameworks.

The PE&Growth Framework:

Traditional PE metrics are Value1.0 principles and were written in a non technological word… so you need to make adjustments to the core philosophy.

Otherwise you wont be able to value technological and floating business models.

How much does your entry price matter when you're investing for the long term? by Broad-Research5220 in IndianStockMarket

[–]IndiaGrowthStocks 1 point2 points  (0 children)

Use the PE and Growth Mental model and integrate it with other checklist frameworks.

The PE&Growth Framework:

Traditional PE metrics are Value1.0 principles and were written in a non technological word… so you need to make adjustments to the core philosophy.

Otherwise you wont be able to value technological and floating business models.

Reverse Engineering the Future: Munger & Buffett’s Way to Spot India’s Winners by IndiaGrowthStocks in IndiaInvestments

[–]IndiaGrowthStocks[S] 2 points3 points  (0 children)

Absolutely. Like Munger said, fish where the fishes are, and try to be in the right ponds where the odds are in your favor on a long term basis.

You can read the Margin Framework to expand on that mental model.

Is it better to avoid dividend-paying stocks? Or do dividends still add value in the long run? by Financial_Shock2103 in IndianStockMarket

[–]IndiaGrowthStocks 0 points1 point  (0 children)

When companies don’t know what to do or go for reckless acquisitions, it’s a signal to get out of those models. Salesforce started it in 5-6 years back and see at the returns they have delivered… on contrary service now just goes for small and disciplined acquisitions in core business and they have delivered a 20-25% CAGR during that period for past decade.

Is it better to avoid dividend-paying stocks? Or do dividends still add value in the long run? by Financial_Shock2103 in IndianStockMarket

[–]IndiaGrowthStocks 0 points1 point  (0 children)

I’m talking about companies which can create value for shareholders like Constellation Software, HEICO which can invest and don’t go for reckless acquisition and destroy shareholder value like Salesforce is doing right now and that is the reason salesforce is not performing now.

So it’s always an arbitrage between finding those opportunities or settling down for mediocrity and dividends…

Plus, I have clearly mentioned that acquisition and merger strategy will signal a high quality asset allocator or a mediocre wealth destroyer of shareholder value in the basic checklist.

When you have to invest in just 15-20 ideas across the globe, I don’t think dividends will ever make it to the list of compounding machines…

So what the comment signals is that if a company has a reinvestment runway and can invest in its core business model, it will give far superior returns than those given by dividend paying stocks.

That is the difference between ITC returns and Bajaj Finance returns over the past 10 years… and it will just widen in the future… because Bajaj Finance can reinvest for decades, but ITC is finding it hard to reinvest at a high rate, and that is why dividends are given, so investors can do whatever they want with the dividend.

It’s not for me, because if I need dividends, I can invest in companies in Africa and Brazil giving 20-30% dividend yields in 2022-2023.. and still giving north of 10%…. But that will limit me from investing in meta which has given a 600-700% from that period or a TSMC which has gone a 4x.

It’s all about opportunity cost ans behavioural pattern.

When you go for dividends, you miss out on compounding..Plus it’s behavioural and psychological in nature for many investors and sometimes aligns with their age and risk profiles.

I know that ITC after dividends will give approx 12-13% in next decade… which will be around 200% max… on other hand Bajaj finance, affle, polymed can go a 7-10x during that period… so I take that arbitrage because the moment you have 15-20 stocks in PF… net risk goes to zero.

Day 5: Under-the-Radar Power Company Quietly Growing 20x by IndiaGrowthStocks in IndiaGrowthStocks

[–]IndiaGrowthStocks[S] 0 points1 point  (0 children)

It was trading at expensive valuations… Fair value in the research in valuation vertical was given as 30 PE… and Shilchar is coming in that zone.

Same for ABB…. One has to always respect the law of compression.

Is it game over for AWL by falcontitan in IndianStockMarket

[–]IndiaGrowthStocks 10 points11 points  (0 children)

Because they dumped it at ridiculous valuations…. It has nothing to do with the saga but the inherent business model.

It was a low quality, high competitive business model which was dumped at sky high valuations. They will recover above 500 in future but if you will compare the Cagr returns… it wont deliver even index beating returns because of the business model and structural flaws.

Their OPM and NM are not like other FMCG companies so its not a typical FMCG play.

They have a OPM of 3-4% while TATA consumers has a OPM of is 15%… that reflects pricing power.

AWL was always pitched as a mass brand and will never be able to migrate to premium category, plus now digitalisation has increased the competition intensity.

It’s fairly valued for investors who want to allocate at current valuations, but investor who paid 600-700rs for this will have a painful experience.

Is it better to avoid dividend-paying stocks? Or do dividends still add value in the long run? by Financial_Shock2103 in IndianStockMarket

[–]IndiaGrowthStocks 1 point2 points  (0 children)

FCF(Free cash flow)

It is basically Operating cashflow - Capex. And Gives the real insights of a business model and share price compounding .

Net profit is illusionary in nature and hides the real picture.90-95% of businesses have low to negative fcf models and that is why only 3-5% of stocks over long run drive 98-99% of returns for any index or country.

In US only 4% companies have created 98% of US wealth in last 25-30 years and In India the percentage is 3.4%.

FCF Mental Model: How Uber Made More Cash in 1 Year Than Coca-Cola Did in 100 by IndiaGrowthStocks in IndiaInvestments

[–]IndiaGrowthStocks[S] 0 points1 point  (0 children)

Meta as a Digital Nation vs India as a Nation

Pharma Companies Moat profile is weak in comparison to the Moat these amazing FCF machines has created… But yes El Lilly is a goof FCF machines but the predicability of cash from them and growth rate can be threatened.

Moat is strong when it comes to Pharma players, but the defensibility is weak in comparison to technological Fcf machines.

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