Welcome to the Technofunda Investing community. Thank you for being Life Long Learner...!!!

Share this newsletter Via: LinkedIn, WhatsApp, Twitter​

You can view all previous newsletters here​

Sectors in Focus

​

Delhi Meet-up of Technofunda Community in Pictures

​

Major Corporate Developments This Week

1. Biocon: Co Says Scheme Of Amalgamation Of Biofusion Therapeutics With Biocon Pharma Approved By Indian Tribunal.
2. Puravankara: Company arm Provident Housing secures ₹1,150 cr investment from HDFC Capital. The investment is for 6.2 msf of new residential projects with a combined GDV of ₹17,100 cr.
3. PSP Projects: Company is planning to launch qualified institutional placement (QIP) to raise ₹244 crore
4. CRISIL: Company’s unit gets SEBI license to commence the business of ESG Ratings Provider.
5. PVR Inox: Company launches advertising-free movie cinemas in select luxury properties.
6. NALCO: KABIL signs MoU with CSIR-NGRI for geophysical investigations in critical & strategic minerals sector.
7. Jubilant Pharma: U.S. FDA inspection at Radiopharmaceuticals manufacturing facility of Canada-based unit end with 5 observations.
8. Reliance Industries: Company wins government approval for making additional investments in developing gas reserves in its KG-D6 block in the Bay of Bengal.
9. Zydus Life sciences: Company gets China nod for its oral drug Desidustat, used in treating anaemia in chronic kidney disease patients.
10. NBCC: Company secures projects worth Rs 23,500 crore in last fiscal year.
11. Lloyds Engineering: Company secures naval equipment orders worth over Rs 81 crore.
12. Sona BLW: Company Precision Forgings commissions new plant in Mexico to meet demand for battery EVs.
13. Zomato: Company hikes platform fee by 25% to Rs 5.
14. Lauras Labs: U.S. FDA inspection at API manufacturing facilities at Andhra Pradesh closes without any 483 observations.
15. Star Cement: Company commences commercial production from new clinker line of the company at Lumshnong, Meghalaya.
16. JSW Energy: Arm JSW Neo Energy gets letter of award for 700 MW ISTS connected solar capacity from NTPC.
17. Gokaldas Exports: Company launches Rs 600 crore QIP at Rs 775/share.
18. Hindustan Zinc: Company re-engaging with govt to get modified demerger proposals cleared: Arun Misra, Demerger will lead to two new entities- silver and zinc & lead.

TechnoFunda Investing Quote from Legends -

Above Quote highlights the importance of patience and validation in trading. Livermore advises traders to wait for the market to corroborate their analyses and hypotheses before executing any trades, rather than hastily jumping in based on preliminary assumptions. This principle serves as a risk management tool, ensuring that decisions are made on solid, confirmed market trends rather than speculations. By advocating for entering trades after the market shows signs of moving in a predicted direction, Livermore underscores the benefits of minimizing risks and increasing the likelihood of successful trades

📚 Book I'm Reading This Week ​​​​​Fooled by Randomness This book is about luck–or more precisely, about how we perceive and deal with luck in life and business. Set against the backdrop of the most conspicuous forum in which luck is mistaken for skill–the world of trading–Fooled by Randomness provides captivating insight into one of the least understood factors in all our lives. Writing in an entertaining narrative style, the author tackles major intellectual issues related to the underestimation of the influence of happenstance on our lives. List of All Books I have Shared →

TechnoFunda 101 - Power Capsules

Learn technical as well as fundamental concept in a simple way

Proxy Investing

What is Proxy Investing?

Proxy investing is a unique investment strategy where instead of investing directly in the main opportunity or industry expected to boom, investors put their money into related industries or products that will benefit from the primary boom. The logic here is akin to "selling shovels during a gold rush"—you invest in the infrastructure that supports the main event.

​

Historical Context: The California Gold Rush

The concept of proxy investing can be vividly illustrated through the California Gold Rush of 1848. As thousands flocked to California to find gold, the real wealth was accumulated not by the majority of gold diggers but by those who supplied them with essentials: food, tools, and clothing.

• Key Commodities: The high demand included daily rations, picks, shovels, and notably, denims.
• Levi Strauss & Co.: One notable beneficiary was Levi Strauss, a name that has become synonymous with durable denim clothing initially designed for miners.

​

Lessons from the Gold Rush

This historical event teaches us that during a surge (the gold rush), ancillary services and products (like denim, picks, and shovels) often provide more stable and potentially lucrative investment opportunities compared to the primary venture (gold mining itself).

​

Another Example: The Automobile Industry Boom

Another illustrative example of proxy investing is the rise of the automobile industry in the early 1900s:

• Automobile Frenzy: By 1913, horse-drawn carriages were largely replaced by automobiles, creating a frenzy similar to a gold rush in the automotive industry.
• Survivor: Among hundreds of automobile manufacturers that sprung up, most did not survive. Ford Motors stands out as a notable exception.
• Supporting Industry: Contrastingly, the tire manufacturers supplying these automobiles experienced much higher survival and success rates.

​

Proxy Investing Advantage

The major advantage of proxy investing lies in its ability to capture growth while potentially mitigating the risks associated with the primary market's volatility:

• Lower Risk: Investments in supporting industries often carry lower risks compared to the main industry.
• Stable Returns: These investments can provide more stable returns, as the demand is driven by the primary industry’s growth yet is not dependent on the success of any single entity within that industry.

​

Why Consider Proxy Investing?

For modern investors, looking for the "shovel sellers" during an industry boom can be a wise strategy. Whether it’s investing in companies producing electric vehicle batteries components during the EV industry's expansion or cloud infrastructure providers amid the growth of tech companies, finding and investing in these proxy opportunities can be both prudent and profitable.

​

In conclusion, proxy investing offers a strategic pathway to diversification and risk management in one's investment portfolio. By understanding and applying this model, investors can seek avenues with potentially high returns without directly exposing themselves to the high-risk environments of booming primary markets. As always, thorough research and due diligence are recommended when identifying these proxy investment opportunities.

🚀 My Content For This Week 🎬 YouTube: DEFENCE SECTOR DEEP DIVE​ ​ 📋 Twitter: Vivek Mashrani, CFA @MashraniVivek When to be patient and hold a stock? In this thread, we'll cover 4 essential points to keep in mind when constructing a Satellite Portfolio. Let’s go… #TechnoFunda #Investing https://twitter.com/i/web/status/1784183531251318824 5:1 PM • Apr 27, 2024 0 Retweets 0 Likes Read 1 replies ​

🎙️ My Weekly Podcast For You

​​

Keep Compounding...

Vivek Mashrani, CFA Founder, TechnoFunda Investing

​

You Can Share This Newsletter...!!! ​​​

​

Follow all my content on my social media handles below ​​​​​​​​

Disclaimer:

• The content provided on this page by the publisher is not guaranteed to be accurate or comprehensive. All opinions and statements expressed herein are solely those of the author.
• The information found on this newsletter should not be interpreted as investment advice, nor does it express any viewpoint on the future trading prices of any company's securities. The opinions and information shared here should not be taken as specific guidance for making investment decisions.
• The content, including opinions and expressions, present on this newsletter, is not a direct or indirect offer or solicitation to buy or sell securities or financial instruments mentioned. The securities quoted are for illustration only and are not recommendatory.
• Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
• By accessing the site or affiliated social media accounts, you signify your agreement to this disclaimer and the terms of use.
• Neither the publisher nor its affiliates assume liability for any direct or consequential losses arising directly or indirectly from the use of the information provided in this content.

Shivalik Parkview, Ahmedabad, Gujarat 380058
​Unsubscribe · Preferences​