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Thursday, 31 December 2020

Weekend Reading

HAPPY NEW YEAR to all the readers!


Reading across disciplines is one of the best ways to improve our investment acumen. Here is a summary of some of the best articles I read this week.

I especially try to not post Corona related articles as that is all one gets to read in all traditional media.

 

If you like this collection, consider forwarding it to someone who you think will appreciate it.

 


Experiences, not appearances, make us happy

Most of us try to make decisions intended to bring us greater happiness. The problem is that we misunderstand how our choices really impact our well-being and end up making ones that have the opposite effect. We buy stuff that purports to inspire happiness and end up feeling depressed instead. Knowing some of the typical pitfalls in the search for happiness—especially the ones that seem to go against common sense—can help us improve quality of life.

It’s an old adage that experiences make us happier than physical things. But knowing is not the same as doing.

We maximize our chances at happiness when we prioritize our experience of life instead of acquiring things to fill it with.

https://fs.blog/2020/07/appearances-vs-experiences/

 


Keep it Simple: Aditya Puri

I have been a big fan of Aditya Puri. He is without doubt one of the greatest bankers in the world along with being a tremendous institution builder. A true legend. An interview with McKinsey.

Noting that HDFC Bank delivered total shareholder returns of more than 16,000 percent under Puri, the Economist suggested that he might be the “world’s best banker.”

To hear Puri tell it, HDFC Bank’s success comes from keeping its business simple by hewing to its founding principles: customer focus, risk management, technology-led innovation, and a “first among equals” culture.

We developed a standard rule that we wouldn’t bet the bank. We also said that credit would be a separate structure from sales and marketing, to keep credit independent. We decided there’s no point having a credit person if that person is going to report to the sales or business leader, because then sales will always prevail. Constructive tension between these functions worked for us.

https://www.mckinsey.com/industries/financial-services/our-insights/keep-it-simple-aditya-puri-on-hdfc-banks-path-to-market-leadership


 

The true picture of two wheeler sales in India

 As per SIAM, a total of around 9.64 million units of two-wheelers were sold in India during this financial year. FADA puts the number at 6.19 million units, almost 36% lower. This is a difference of close to 3.45 million units.

 A small part of it stems from the fact that FADA sales numbers do not take into account sales made in the states of Andhra Pradesh, Telangana and Madhya Pradesh, which aren’t yet on the government’s Vahan 4 database, which FADA uses to publish the retail sales numbers. But retail sales in just three states can’t explain a difference of 3.45 million units between the SIAM sales number and the FADA sales number.

This basically means that while manufacturers have been selling two-wheelers to retailers and retailers haven’t been able to sell a significant portion of what they have bought from manufacturers to the end consumer. Channel stuffing has been carried out and now the retailers have ended up with a significant amount of inventory. FADA suggests that the average inventory of two-wheelers with dealers is at 45-50 days. This is at the end of the festival season. Last year, at the end of the festival season the two-wheeler retailers had an average inventory of 35-40 days.

https://vivekkaul.com/2020/12/12/the-curious-case-of-indias-two-wheeler-sales-or-why-nothing-is-the-way-it-seems/


 

People will keep taking their vitamin pills

This year the dietary supplement industry is forecast to grow as much as 20%. Why? Because the pandemic is encouraging people to consume more and more multivitamins to try to boost their immunity, so they don’t contract COVID-19. So what we’ve seen is tremendous increases in vitamin C, vitamin D, E3 and probiotics. It’s a great time to be in the supplement market.

People who have now increased their usage of multivitamins will continue to do so. It’s reinforcing. They didn’t get sick during the pandemic when they took more supplements, so they’ll continue to take more supplements after a vaccine is found. We’re very encouraged that the growth we’re experiencing this year in multivitamins and in vitamins overall will continue in the foreseeable future.

https://glginsights.com/articles/nutraceutical-industry-update/

 


Learnings from nature

In undisturbed ancient forests, youngsters have to spend their first two hundred years waiting patiently in their mothers’ shade. As they struggle to put on a few feet, they develop wood that is incredibly dense. In modern managed forests today, seedlings grow without any parental shade to slow them down. They shoot up and form large growth rings even without a nutrient boost from added nitrogen. Consequently, their woody cells are much larger than normal and contain much more air, which makes them susceptible to fungi—after all, fungi like to breathe, too. A tree that grows quickly rots quickly and therefore never has a chance to grow old.

https://blas.com/the-secret-wisdom-of-nature/



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