David Cornell is the managing director of Ocean Dial Advisers Private, Mumbai. His diary runs from March 12-16.
Monday: I arrive at work by 8.00am, which is considered early for Mumbaikers. I like to beat the rush hour plus I relish the 90 minutes at my desk before the team arrives. The working day starts at about 9.30am as workers typically suffer a long commute and in Indian households there are family matters that need sorting before work can start.
This morning I am preparing for calls with the management of two consumer companies that we are tracking. Both are Bangalore-based, and although we visited them recently, because of the distances and travel involved, the follow-up meeting happens over the phone.
The first is with TTK Prestige, a leading producer of branded cookware. The second is with Page Industries, the licensee of the Jockey brand in India. Valuations for both appear expensive, but growth is slowing; any negative announcement will depress the stocks and create a tremendous buying opportunity. (Diary continues below)
Tuesday: I write up my notes and discuss the calls with my colleagues. I am tempted to dip a toe in, but hold off as we think the growth slowdown will continue.
Today we have a meeting with an economist to listen to his views on the market impact of recent state elections. Politics in India is an on-going saga of low expectations that are never fulfilled, but for the time being the market is not pricing any positive expectation.
Wednesday: Today we have an internal portfolio review meeting. This is a long affair that takes time to prepare. Each stock that has either meaningfully under or outperformed over the past month is discussed and the reasons are dissected.
After two hours we send out for chocolate to restore our energy levels and press on. These meetings are arduous and gruelling, but an essential part of our investment process. But because of the recent volatility in markets there are many stocks to discuss.
Thursday: Today I sail with a friend in Bombay harbour before work. It is not the cleanest water but my shoulders drop as I escape the noise and bustle of the city. When we moor I feel as if I have been on holiday, and yet I am at work by 9.00am.
This afternoon I have meetings with two consumer companies of a different sort. Cox and Kings is a well-established brand that is building a business model to cater for the tens of thousands of Indian tourists expected to travel to Europe in time. Another stock, Mahindra Holidays, caters for Indians’ domestic requirements. This is a hugely under-penetrated space.
In the evening I am invited to listen to Martin Feldstein, a member of Barack Obama’s economic advisory board. He talks about his outlook for the developed markets. Greece, he says, is a “basket case” and will default again, and America will struggle to grow at 2%. Markets are too complacent at the moment, he says.
Friday: Tomorrow is budget day in India, which in look and feel is similar to the English version and cloned from the same. We will sit glued to the office television and work fast to digest the news flow and the likely effect on markets, before taking stock of the impact on portfolios.
The weeks fly by here. I cannot believe it is mid-March already.