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Sectors in Focus

Major Corporate Developments This Week

• RailTel secured order worth Rs. 52.9 cr from Gujarat Informatics.
• Suprajit Engineering buys 1.75 lakh Sq Ft land in Karnataka.
• Ramkrishna Forgings bagged 7.82 MWp Solar PV project from Prozeal Green Energy.
• Lupin receiving approval from the USFDA for Bromfenac Ophthalmic Solution (0.07%), and tentative approval from the USFDA for Canagliflozin tablets.
• Gland Pharma received the Establishment Inspection Report (EIR) from the US Food and Drug Administration (USFDA) following inspection at its Pashamylaram facility at Hyderabad.
• Global Pharma major Lupin launched the world’s first fixed-dose triple combination drug (FDC) under the brand name Vilfuro-G for the effective management of chronic obstructive pulmonary disease (COPD) in India. This milestone follows the approval granted by the Drug Controller General of India for the Dry Powder Inhaler (DPI) product.
• Vascon Engineers gets ‘Letter of Intent’ from Pimpri-Chinchwad, Municipal Corporation of Rs 356.78 cr
• KEC International received new orders worth Rs. 1,005 crores across its various businesses.
• Laurus Labs increased its stake in Laurus Bio to 87.59%.
• Titagarh Rail Systems have formed a partnership to supply propulsion systems for metro rolling stock projects in India.
• Infosys announced yet another successful collaboration with Proximus, Belgium’s leading digital services and communications solutions provider, to deliver an IT modernization and consolidation project. The project will see Infosys consolidating key components of the IT stack of a Proximus affiliate into the main IT stack, enabling them among others to offer fiber and new digital services to more of its customers.
• Strides Pharma Science announced that its step-down wholly owned subsidiary, Strides Pharma Global Pte. Ltd, Singapore, has received approval for Levetiracetam Oral Solution USP, 100 mg/mL, from the United States Food & Drug Administration (USFDA).
• Datamatics Global Services has signed a contract with a US based company for Digital Experiences Business. The total client target spend over 5 years is estimated at USD 36 Mn.

Technofunda Investing Quote from Legends

Warren Buffett on 'Competitive advantage' The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.

Buffett's investment philosophy centers around seeking companies with enduring competitive advantages within their industries. This advantage entails possessing unique qualities—be it superior products, efficient production methods, or a robust brand—that set them apart from competitors. This competitive edge translates into the company's ability to command higher prices, lower production costs, increase profits, and secure a larger market share.

But for Buffett, it's not just about having a competitive advantage; it's about its durability. He seeks companies capable of maintaining their edge not just for a brief period but for the long haul. This principle reflects in his holdings, such as Apple, a prime example of a company consistently maintaining premium prices owing to its superior brand. Buffett's focus on enduring competitive advantages emphasizes the essence of longevity and stability in his investment choices.

📚 Book I'm Reading This Week MASTERING THE MARKET CYCLE "Mastering the Market Cycle" by Howard Marks provides a comprehensive insight into understanding market cycles and their impact on investments. Marks emphasizes the significance of recognizing the phases within these cycles and their connection to human psychology and behavior. He explores the continuous nature of market cycles and their stages, highlighting how various factors contribute to each phase. Marks shares real-life examples and experiences from his successful career, illustrating the importance of positioning portfolios during market turning points. He stresses the challenges of accurately predicting cycle tops or bottoms, yet encourages investors to gauge where the cycle stands presently. By examining the extremes in market psychology and valuations, Marks warns against the dangers of over-optimism or pessimism during these periods. List of All Books I have Shared →

TechnoFunda 101 - Power Capsules

Learn technical as well as fundamental concept in a simple way

Cash Conversion Cycle (CCC) / Net Working Capital -

Net Working Capital (NWC), or the Cash Conversion Cycle (CCC), acts as a financial stopwatch, measuring how quickly a company turns its investments into cash. Think of it as a race to convert resources into money. Let's break down this financial race into three key laps:

1. Inventory Days: This lap gauges how fast a company sells its goods. Imagine it as the time it takes for items on a store shelf to be sold. Shorter Inventory Days mean products are flying off the shelves faster, showcasing efficient inventory management.
2. Receivable Days: Here, we're timing how long it takes for a company to collect payments from customers. It's like tracking how quickly money comes in after a sale. Lower Receivable Days signal that the company is swift in converting sales into cash, a good sign for healthy cash flow.
3. Payable Days: This lap measures how prompt a company is in paying its bills. It's akin to how quickly you settle your credit card after a shopping spree. Higher Payable Days might indicate better credit terms, enabling the company to hold onto its cash a bit longer.

Now, imagine running this race. We add up Inventory Days and Receivable Days, and then subtract Payable Days. The result is the Net Working Capital Cycle. A shorter cycle suggests the company is speedily turning its investments into cash, which is great for financial health. But a longer cycle might hint at potential cash flow issues and operational inefficiencies.

Understanding these laps and their relationship helps investors assess how efficiently a company manages its cash flow. It's like decoding the company's financial fitness routine, giving investors insights into its overall financial strength and agility.

🚀 My Content For This Week 🎬 YouTube: Fundamental Analysis Using Excel Screener​ 📋 Twitter: Vivek Mashrani, CFA @MashraniVivek Welcome to the world of Cash Flow Statement! 🚀💰 Have you ever wondered how money moves in and out of a business? Well, we're here to make it simple Ready for the ride? Let's get started!... #technofunda #cashflow #stockmarkets #StockMarketindia #StocksToBuy 4:44 PM • Nov 24, 2023 29 Retweets 92 Likes Read 2 replies ​

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Vivek Mashrani, CFA Founder, TechnoFunda Investing

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