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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?


To: Harshu Vyas who wrote (75661)5/18/2024 11:51:35 AM
From: FIFO_kid23 Recommendations

Recommended By
Harshu Vyas
Lance Bredvold
Spekulatius

  Read Replies (1) | Respond to of 78958
 
Harshu I think you are certainly on the right track here with this selection given its cheap and defensive.The growth of the economy should favor many countries in the Asian belt.

Now you have to figure out why it is so cheap. It could be a value trap. Some hurdles to research why did the dividend cease in 2017 and not get reinstated and with family/majority owned businesses will have restrictive control to outside minority investors and negatively impact the real market value of the enterprise. If the family with affiliates own more than 50% of the business would certainly then explain the large valuation discount as they tend to use the business as a personal piggy bank with no pressure to improve the business. Generally you want to see inside ownership between 10-30% but I would research if there are affiliates

I learned the hard way on this one with Aura Minerals it was 47% owned by an individual. The activist group I was associated with had about 14% It was Tim S. (a person I have mentioned before to you) an institution and me that we thought was very undervalued by somewhere between 5-10 fold we made our suggestions he got an affiliate to block us and what irks me is 18 months later he actually did what our group suggested and the stock proceeded to go up 20 fold a year after that move. So you are controlled at the whim of another party. Unfortunately I didn't have the patience here with this situation and took a 10% loss



To: Harshu Vyas who wrote (75661)5/18/2024 11:52:39 AM
From: E_K_S3 Recommendations

Recommended By
bruwin
Lance Bredvold
S. maltophilia

  Respond to of 78958
 
The biggest Red Flag for me is the "Political" risk. Remember who the BRIC Countries are?

perplexity.ai
The BRICS countries are Brazil, Russia, India, China, and South Africa. Here are some key points about their alliance and position on US domestic and foreign policy:
  • BRICS is an economic alliance formed in 2009 to promote cooperation among the major emerging economies. It accounts for around 31.5% of global GDP and 41% of the world's population.
  • The BRICS countries have increasingly aligned themselves as an alternative to the US-led Western order, seeking to reduce dependence on the US dollar and Western-dominated institutions like the World Bank and IMF.
  • They have deepened cooperation in areas like finance, trade, security, and sustainable development, with growing convergence on joint policies that sometimes diverge from US interests.
  • After the Ukraine war and Western sanctions on Russia, BRICS countries have strengthened economic ties with Russia and opposed isolating it, ensuring its economic survival. This has increased tensions with the US.
  • BRICS members like China, India, and South Africa have critiqued the use of economic sanctions and the global financial system as instruments of geopolitical contestation by the US and West.
  • The BRICS push for "dedollarization" and use of local currencies in trade is driven partly by concerns over potential US sanctions freezing their dollar assets or cutting them off from the dollar system.
  • However, important US partners like India have also played a major role in strengthening BRICS cooperation, creating challenges for US policy towards the group.
In summary, while not overtly anti-US, the BRICS alliance is increasingly presenting an alternative economic and financial order that challenges US dominance and foreign policy tools like economic sanctions.
US is using economic sanctions on those Countries that do not align with their views (look at the huge proposed sanctions on China 100% on ALL EV's).

So India may/could do the same against the US or in some alliance w/ the BRIC Countries.

As a result, I tend to avoid all companies that have this type of 'political' exposure especially if those companies have a lot of their revenues coming from the US.