22 09, 2015

Amtek Auto Defaults on 800 cr. bonds. A View On The Tricky Recovery Process.

By |September 22nd, 2015|Categories: AmtekAuto|5 Comments

And the expected has happened: Amtek Auto has defaulted on its 800 cr. of bonds that were due on Sunday. They had till end of day yesterday to pay up, and they didn’t make that payment.

For a bank holding the bonds this account is technically not an NPA until 90 days is over. So they can extend and pretend and hope that Amtek manages to salvage itself. Since the banking system has exposure to more than 7,000 cr. of loans to Amtek, you can bet your next salary that they will restructure the loan in some way and […]

15 09, 2015

JP Morgan AMC Isolates Amtek Bonds Into A Side Pocket, Will Allow Redemptions of the Rest

By |September 15th, 2015|Categories: AmtekAuto, MutualFunds|0 Comments

JP Morgan, which has been in the news because if refuses to let people exit short term funds (currently has a gate of 1% per day), has now offered a redemption proposal to “segregate” its funds.  The Proposal is complex but basically it’s like this:

  • If you own 5000 units of the fund today
  • You will continue to own 5000 units of the fund tomorrow
  • But you will get additional units of a new “segregated” fund containing the Amtek Auto bond (illiquid asset)
  • The NAV Of the current fund will fall since you are effectively splitting assets
  • […]

14 09, 2015

Kesoram Sells Tyre Subsidiary to JK Tyre 1month and 5 Days After Vehemently Denying It Would Sell Tyre Subsidiary To JK Tyre

By |September 14th, 2015|Categories: KESORAMIND, Tyres|1 Comment

Kesoram Industries’ press release, August 7:


“Nonetheless Reiterate”, “No Intentions” – means: Oh come on, there is no way we are selling.

And then, on September 12:


The Chart says People liked it in the morning today, but didn’t like it:


But They’re Not Releasing Results Info Since December 2014:

Let’s […]

14 09, 2015

Amtek Auto Management Clarifies, Stock Moves Up, But Drama Still Ahead

By |September 14th, 2015|Categories: AmtekAuto|0 Comments

The Senior MD at Amtek Auto, John Flintham, was on ET Now for a clarification of what the situation was:


So what he’s saying is:

7 09, 2015

Zee Promoter Company Borrows 2,200 Cr. , Has No Cash Flows, Negative Net Worth, Rated A+ on Shares Pledged and Franklin Templeton MF owns 800 cr. of That Debt

By |September 7th, 2015|Categories: ZEEL|Tags: , |54 Comments

Why are we so trusting of rating agencies? The recent drama with Amtek Auto and the restriction on redemptions to 1% by JP Morgan AMC on two of its funds is a glaring example of where rating agencies have failed to identify problems early.

In two more examples, it’s apparent that rating agencies have rated debt very high when they shouldn’t at all be given that kind of rating, at least in my opinion

Take the case of Sprit Textiles Private Limited. This is a promoter company of Zee and Dish TV, and is owned by Subhash […]

4 09, 2015

Amtek Auto Down Another 36% on Thursday as FIIs Dump Stock

By |September 4th, 2015|Categories: AmtekAuto|2 Comments

This Amtek Auto story continues to worsen. First, it fell 60% when it was removed from futures and options, and earlier, downgraded. And then, two JP Morgan AMC short term debt funds that held about 200 cr. of its debt saw a fall in their NAV and cut redemptions to 1% per day.

On Thursday things REALLY went wrong, and the stock fell a further 36% from there. (it’s down another 8% today)

image […]

30 07, 2015

Suckered: Castex Goes From 40 to 360, and Since Then, No Buyers.

By |July 30th, 2015|Categories: Castex, Suckered|18 Comments

So there’s this stock called Castex Technologies.

Let me introduce you to this chart:



The stock rose from Rs. 40 to Rs. 360 and then, it’s been limit down (5% down per day) since. With next to no volume.

The company is in the auto component space, and used to be called Amtek India. It’s still promoted by Amtek Auto, which is a listed company but that share is not doing anywhere close […]

27 07, 2015

JP Associates Gets a "Near Default" tag by CARE, Loans of Over 22,000 cr. at Stake

By |July 27th, 2015|Categories: ICICI Bank, idb, IDBI, JPAssociates|5 Comments

CARE has downgraded JP Associates‘ rating to D, which means that according to CARE they are in default, or very likely to default.


What they say:

The revision in the ratings of the bank facilities and instruments of Jaiprakash Associates Ltd (JAL) takes into account delay in servicing of debt obligations by the company due to its weak liquidity position.

But What Do Rating Agencies Know, Huh?

The biggest problem with […]

22 07, 2015

Infy: Jun 2015 Quarter Results Show Terrible Profit Growth Even Though Revenues Pick Up

By |July 22nd, 2015|Categories: Infosys, Results|Comments Off on Infy: Jun 2015 Quarter Results Show Terrible Profit Growth Even Though Revenues Pick Up

Infy results had come out yesterday and we do a chart thing with them:

Revenues up 7.03% : The Only Good Thing About Results


Profits are up 5% yoy but down 2% quarter on quarter. The only metric that works for them is quarter-on-quarter revenue growth.

EPS Growth, Too, Falls



23 06, 2015

Video: Full Interview at CNBC-TV18 on 22nd June

By |June 23rd, 2015|Categories: CNBCTV18, Stocks, Video|Tags: , , |Comments Off on Video: Full Interview at CNBC-TV18 on 22nd June

Here is the full video of my interview at CNBC-TV18 in which I discuss select stocks including Reliance Industries, Sriram Transport and more. I also share my thoughts on the real estate, railway and defense sectors. Click the image below to see the video on the CNBC/Moneycontrol page:


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17 06, 2015

Why is FIPB Rejecting the Request for the Strides-Shasun Merger?

By |June 17th, 2015|Categories: Government, Stocks, StridesArcolab|2 Comments

So Strides Arcolab was going to merge with Shasun. This merger was cleared by shareholders. Then it was cleared by the Competition Commission. And there’s some court meetings that have been done.

It needed an approval from the Foreign Investment Promotion Board (FIPB) which has, apparently, rejected the proposal. They needed this approval in order to issue shares of Strides to Shasun shareholders that were non-resident. Shasun has about 21% ownership by Foreign investors, which will, post the merger translate to just 5% of shares in Strides.

Strides has about 38% holding with […]

15 06, 2015

Vedanta to Merge With Cairn, Gets Hands on Cash, Takes Retro-Tax Risk

By |June 15th, 2015|Categories: Cairn, Stocks, Vedanta|Comments Off on Vedanta to Merge With Cairn, Gets Hands on Cash, Takes Retro-Tax Risk

Cairn and Vedanta will merge soon, says a Vedanta Board Meeting note, where Cairn shareholders will get:

  • One share of Vedanta for a share of Cairn
  • A preference share of Vedanta worth Rs. 10 for every share owned, which pays 7.5% dividend per year and pays it out at the end of each financial year.

And that’s pretty much it.


Sit back and relax. Sometime in the March 2016 quarter. That is approximately the time of the next Greece drama, so I would not suggest immediate outrage. Though honestly I am a terrible person to […]

10 06, 2015

JustDial Will Buy Back at 1550 per Share, But Just 2-3% of Shares Will Be Bought

By |June 10th, 2015|Categories: JustDial|4 Comments

JustDial recently decided to buy back shares. They have a reasonable amount of cash on the books, and they will be using about Rs. 170 cr. of that money to buy back shares through a tender offer. See the conference call transcript.

(Also read: Demystifying Share Buybacks)

Just Dial will pay Rs. 1550 per share. At that price it can buy back just 11 lakh shares.

Their stock price is much lower – at 1096 as we write.


20 05, 2015

Interviewed at ET Now: On Splitting Airtel, The Upgrade of Persistent Systems and The Bank EPS Push

By |May 20th, 2015|Categories: Banks, Bharti, BHARTIARTL, ETNow, PERSISTENT, Video|6 Comments

I was interviewed on ET Now Today, and here are the snippets. Plus, clarifications

Splitting Airtel’s business a good idea, but may hurt Indian shareholders

I believe that splitting Airtel’s business into the Indian and African units is a good idea, but it’s unlikely to happen because of the debt overhang.

Therefore, it would be seen that will the lenders agree on creating a new entity and pass on most of the debt to it. That would be difficult to push. Even if the telecom operator engineers a split, it might have to end up taking […]