ExpertDabbler

SSPDL is a small cap Real Estate company focused primarily on the southern markets of Chennai, Bangalore and Hyderabad. I first came across this company based on a recommendation by HIDDEN GEMS fame Ashish Chugh.

I researched a bit more and found that company was indeed priced dirt cheap. For a company which had IT parks - ALPHA CITY, and MATRIX TOWERS in OMR under it’s belt, it’s market cap was at 40 crores. The company had debt of 50 odd crores. In total the enterprise value did not exceed 100 crores. For this price, in current real estate prices, it was a no brainer conclusion to realize the company was lowly valued.

Just to ensure the company was not a shell company, I went to the projects mentioned in the website to enquire, namely SSPDL ‘alpha city’ and SSPDL Crescent apartment projects. When I enquired, the apartments in Kelambakkam road was almost sold out and construction activity was going on. They had just announced a villa project called LAKEWOOD. Each villa was priced at close to one crore,and they had 26 villas in that project.

All along, the stock was just unbelievably cheap. Here’s a business which was worth much more than a few hundred crores and was selling at less than hundred crores. Buying when the prices are so low is incredibly counter intuitive.I wrote about this company to the Capital ideas club but never heard back from them.

When the idly and chutney is too good at home, I am always tempted to have one more idly. With exactly the same mentality, I bought a small number of shares in the company in my personal account. Nothing happened for six months, and then last week there was a news that inter serve, a uk based construction major with revenues of about 1.9 billion pounds has bought a 50% stake in SSPDL subsidiary.
The stock has been hitting upper circuit ever since, the value has already gone up by 50 % and I am cursing myself for not buying more then (is not everything so crystal clear in hind sight?).

In the market, nothing is a sure thing, but when we get something as close to sure thing, we should bet heavily. That is the lesson for me.

Do I have to tell what subject she blogs on? Yes it’s a food blog. And I was ready to confer the title of chef to her because her weekend cooking is pretty good. The only thing I am not happy about is the photographs. For some reason she does not want me to shoot those pictures in my camera. She sticks to her point and shoot. We should do something about it soon.

Do check out http://chefhema.wordpress.com

Update:
Filed my return on time after paying the due taxes “FINALLY’ arrived at my auditor. Thanks to online tax payment and online return filing process, gone are the days when people were forced to stand in long queues.

I am back from discussing with my auditor who takes care of my tax issues. Maybe it is just me, but i am having a hard time with the auditors for the second year in a row.

My expectation is that I will submit all my details well in advance. I expect my auditor to clearly do all the calculations and spell out my tax liability. And be able to answer my questions, if any.

Last year, I consulted an auditor in Madurai, who was not a Chartered Accountant. Let us just say he is the lodge vaithiyar equivalent in the auditor fraternity. He coolly classified my mom’s family pension as ‘Salary income’. I just happened to be awake at the wrong time and searched google, so caught this mistake.

So this year, I caught hold of a proper Chartered Accountant. But this year was even more interesting. I had bought and sold a bunch of shares. There are capital gains and capital loss. And within these
there are two sub categories - long term and short term. For a grand total of eleven stocks, it would take hardly a day to figure out the net tax liability. But the reality is, i gave all the details three weeks back, and am still waiting to get an error free statement.

It is not that the auditor does not know. It is just that he asks his articled clerk to do the work, who obviously is learning. First, he had the dates wrong for about 4 transactions. He entered 2008 as 2009. Some had a sale transaction date mentioned ‘Nov 12 2010′. Some had the buy date later than the sale date, even when i had sold all the shares of that company.

But I would not blame the articled clerk, I would blame the auditor for not verifying the details. I have already traveled back and forth to Vadapalani area twice for this purpose. First I was told I had to pay 8000 rupees tax later when I probed, I figured a loss was entered as a profit, the dialogue came to ‘ 4000 rupees tax, sir’ , which later came to ‘2000 rupees tax’ and eventually ‘no tax liability’.

What if I had nil tax knowledge and had just blindly believed these folks? I would’ve paid 8000 Rs. tax unnecessarily. How many semi-literate small business men are like this in our country who will rely solely on the auditor? I totally detest that cavalier attitude.

I came back home, asking him to prepare a revised, error free statement so that I can file the return online myself.
And tomorrow is the last date to file the Income tax return for individual tax payer. ‘Beware the auditor, for they know a lot more than you in tax matters, and so can make more mistakes’ has been my lesson till now.

Coming to think of it, I think there are some professions For e.g. science, medicine - neuro surgery, aircraft pilot etc, where an amateur does not stand a chance, and we just have to have that faith in the expert. On the other hand, in commercial and legal matters, we as consumers of professional services should do our own due diligence to avoid being taken for a ride.

There is a hot debate happening in NEEYA NAANA even as I write this - money minded doctors. To me the one book which would really be a benchmark on the corruption in the medical field would still be POSTMORTEM published by VIKATAN. To put it bluntly, most of these so called talk shows sound shallow and mokkai to me.

If some one pays Rs. 1 crore for an MD Seat in Radiology, he should be out of his mind if he is not money minded.
The only reason I watched today’s episode was because if the presence of Jeyamohan. But he too sounded far more like a ‘trade unionist’ than a yadhartha vaadhi…

There was this field worker who partly blamed the doctors for the 2,50,000 farmer suicides in Vidharba.
He could’ve just as well blamed anybody and it would still be appropriate - the bankers who did not extend credit, the poor law enforcement systems, the policies by the government, etc.

None of the controversial practices by the doctors were actually discussed and no requests to stop some of the practices was put forth. For example, why should doctors have a particular medical shop name in his letter pad? Why should a doctor see the representative from Ranbaxy or Dr. Reddys? Why does the representatives dole out free samples to the doctors? Why are doctors given television sets when he attains a target of prescribing a certain drug? Any mokkai student of psychology will tell these are powerful tools of influence used by the drug companies to manipulate the doctors. So long as the doctors are going to benefit by it, they are not going to mind it (because they are not saints) and so long as these tools are effective, the drug companies are not going to stop it. There is a problem, but the problem is in the entire ecosystem, not just one component of it. It was irony that one of the employee from a pharma company was quick in blaming the doctors.

The average doctor is as likely to be money minded as an average policeman, or the average auto driver, or the lawyer, or a bureaucrat. They are as much representative of the society they are part of. To assume any other way sounds far removed from reality.

Here would be my approach:
- Increase the number of medical colleges - private and public. For a country of 1+bilion people, how many reputed medical institutes do we have? pathetically poor.
- Pharma companies should be banned from meeting the doctors personally. There should be other ways to get feedback from the doctors community as a whole but certainly not on a one to one level. Whoever does not understand this should be made to read on ‘Reciprocity’ in Robert Cialdini’s book ‘INFLUENCE’.
- Doctors should be banned from having some fancy medical stores names and dignostics names in their letter pad. A patient should be able to get any medicine from any pharmacist. It goes without saying that pharmacist should be stopped from seeing the doctors.
- No ban will work unless the incentives are strong - both positive and negative. Just make the practice of ‘interacting with pharma representatives’ equivalent to Section 498a. People should be taken to police station on a ‘no questions asked’ basis for sometime.

Of course not even one idea to make things better was discussed in that talk show.

Bottom line, the age-old formula of categorizing one section of the people and targeting them as a whole has worked again from an entertainment perspective. The media can again position itself as the guardian of people’s rights. The social workers can use the opportunity to blame everything and anything - that is easy part, try coming up with solutions that work for all. For every corporate hospital which charge Rs. 300 for a simple consultation, there are several Dr. Thangaraj’s of Velachery who do service for Rs. 40 till late into the night.

I think there is an average median income that the urban middle class society has in mind for themselves. Any lucky profession which seems to make more than that will come under fire in due course. All sorts of morality questions will be asked. They will be targeted in talk shows.

On the other end of the spectrum, most of the duty doctors (mere MBBS grads) still work for a pittance when compared to the software crowd. While sales representatives from pharma companies can go about minting more money than the doctors even while complaining ‘Che.. doctors rombo mosam’.

My mom likes to watch all these talk shows. I can’t stand it nowadays.

My wife works in a private college as a senior lecturer. The way these colleges are administered will make all those in the ‘code eludhara coolie’ junta feel like being part of heaven.

Form 16 - in all these years in the IT industry, I had them delivered via e-mail. Even smaller organizations would appoint some one to hand deliver/distribute Form 16. The distribution usually happens in the month of May to facilitate filing of returns by the 31st of July.

Cut back to the private college, my wife basically was behind the administration for more than a week, just to get her Form - 16. One fine day, she finally got it only to find that she had been given a form with 2009-10 details in a 2008-9 form. Now, don’t ask me how that can happen. Any type of somersault is possible in places like that.

She goes back to the accounts department, points out the mistake, and Voilà! we get Form 16 version 2.0. This time we find there is no mention of the taxes collected and paid to the Central Govt. Account. When asked, the administrative folks explain that no tax was deducted from her salary - absolutely untrue.
We do one more round of auditing to find the month(s) in which taxes were deducted from the bank statements. And now we have the version 3.0 just few days before the July 31st deadline. Of course, in all the versions, the guy had basically declared ‘all the contents in the form are true and nothing but the truth’.

Compare this with the fuss some of my colleagues make with the company transport desk, when there is a few minutes delay in their cabs to key junction points, which till date is free for all employees. I realized we take so many things for granted in the IT industry.

Some other complaints I keep hearing in my office:

Fridge la butter milk illai,
Pantry la nalla biscuit illai,
Youtube block pannitaan, etc.

One visit on a weekend will reveal the kind of housekeeping machinery at work to present an office environment that we are so used to.
Youtube, I know so many of my colleagues who were basically watching full length movies in office bandwidth.
On the other hand there are so many IT companies where even a personal mail check is rationed for one hour a day, and people still work there. I am sure there will be nitpickers even in Facebook/Google kinda offices in India.
Most of the IT folks at least in my office suffer from what Charlie Munger calls ‘Excessive self regard’ tendency.
And I keep saying this to my friends in tea breaks, ‘Count your blessings, for things can and eventually get a lot worse than this’.

Fifteen months since I wrote part 1, i still keep getting comments which I think are more interesting than the post.

I still stand by everything I wrote. Just to add:

None of the brochure or the persons I interacted with said, ‘This course is not for those who are happy with themselves currently’. The folks were only too happy to take Rs.950 from me and let me join. I am still happy with my life which i now learnt is a disqualification for courses like this.

Someone pointed in my comments section that ‘Every dog has its day’. True. Same holds true for every ‘volunteer 100% driven organization for those seeking the ultimate truth’ especially for those in the US of A who can afford to pay $200 USD.

How many of you watched AVATAR? I bet a lot of you. And it was what I call a single dimensional movie supposedly made in 3D. Now, how about a truly multi dimensional movie shot in single D? Or was it? I do not know for sure.

The trick this Christopher Nolan plays on you is that you are being fed this thought that you are solving a puzzle with optimal level of difficulty, made just for you, and you are just about to finish it, and then something happens…

I came out of the theatre yesterday evening and still could not stop thinking about this film. I am not walking around like a zombie, but this film still runs in my head at a corner.
One can ask anyone she comes across who has seen the movie , and the other person can tell and yet it does not matter…for once spoilers does not matter…because that person can never tell everything because it is very hard to digest this movie in one sitting. One can grasp it but not completely digest it. That is the trick.

It’s incredible that our friend Christopher Nolan can write a script like this. And I am running short of superlatives to tell you about his execution. What conviction! He takes like 5 minutes and dialogues to tell the audience the rules of the game..and it sticks..like an idea whose time has come…
Christopher Nolan is a complex genius.
INCEPTION, my best film of 2010.

PS:
Indha padathai sathyam la premiere show partha celebrities, ipdi madam edukaradhai vittutu, Ennamo ramayanam, silapadhigaram nu mokkaya pottukittu…..adhayum urupadiya edukaama…adhileyim ‘naanga adapt pannalai.. Yedho oru silla similarities irukalaam’ nu safe side goal pottukittu….

All the bored IIT professors who write editorials in The MANDU family newspapers think Foreign University Bill is a useless idea. They argue that India needs way more universities than what a few foreign universities can provide by setting up shop here. There is an estimate that India needs at least 800 universities and these foreign shops will not solve our problems. Let us call them the ‘IIT dhaan best’ gang.

On the other hand, all the bored retired DINAMANI editorial reading tamil mamas think allowing foreign universities will mean education becomes business - ‘Ahaa kalvi vyabaram aayidum’. Alas they are yet to realize that business is a better idea than day light robbery. Let us call them ‘the Dinamani gang’.

For the Forbes reading ‘market economy’ gang the only thing that matters is whether the Whartons, MITs, Harvards, INSEADs will setup shop in India. Since they are as likely to come to India as Namitha is likely to act, we need to allow for profit companies to run universities.

I, for one will welcome foreign universities for different reasons. There is way too much money being paid to local third rate private institutions. A PG dental seat in any private dental college in and around Chennai fetches about 15-20 lakhs. This should be more for a PG medical seat. So in essence, this is PG auction, just like 3G auction. And it is no secret that these institutes are run by MPs, MLAs, Ministers or by their 1st/2nd/3rd wives/veppaatis etc. The principals and the HODs are mere puppets. The corruption levels in the education sector in India will make ‘Telecom’ Raja’ look like a saint.

Those who raise objection to foreign universities assume that the likes of Leeds Metro, and Edith Cowan universities would be worse than the Kaduvetti Guru college for degrees. I do not share such view. At least they are in the business of running educational institutions in their own countries and do not have liquor shop/jaadhi sangam background like some of the local patrons running private ‘professional’ colleges in India. Even conservatively assuming the ‘quality of education’ - god alone knows what that is, remains the same, I am hoping that more seats will bring down the current rate of 15 lakhs per PG seat to say, 8 lakhs per seat, and that is a good thing. Is not a 50% discount a good thing?

And as for the clichéd ‘Kalvi vyabaram aaydum’ dialogue, a businessman in a competitive setting will do more good for the society than a politically connected goonda indulging in daylight robbery under the guise of ‘Kalvi’. So, I welcome Foreign Universities!!!

The theme music humming of ‘madhrasapattinam’ which I hear on tv is so reminiscent of the humming in ‘anarkali’ song in ‘kangalal kaidhu sei’. Anyone thinks the same?