Berkshire Hathaway’s 2022 annual shareholder letter
15 months ago we started building a separate team inside Marcellus for creating a Global Compounders Portfolio (GCP). 6 months ago some of Marcellus’ staff started investing their personal funds in GCP. On 15th March 2023, our branch office in GIFT City will start taking clients’ monies for GCP. One of the investee companies in Marcellus’ […]
Indian Lending: Gamblers versus Franchise Builders
The Return on Equity (RoE) of lenders is driven by: (i) strong operating profitability (Return on Assets); or (ii) capital structure (high debt to equity). Recent euphoria in share prices notwithstanding, most PSU banks suffer from weak operational profitability (RoAs of 1% or lower) and high debt to equity ratios (15x+). This deadly combination is […]
The scourge of job-title inflation
When we started Marcellus, we decided at the outset that we will shun all corporate titles such as Vice President or Senior Director and instead designations will show our functional roles such as Analyst or Salesperson. We wanted self-selection to work where prospective hires who care about fancy titles as social proof would go elsewhere. […]
Electric Vehicles Could Match Gasoline Cars on Price This Year
The pace of adoption of smartphones exceeded most expectations by a significant margin. It could be happening to electric cars soon. Thanks to the price cuts led by Tesla last month, many electric car models are now similarly priced to their internal combustion driven counterparts. “The battery-powered version of G.M.’s Equinox crossover, for example, will […]
Sania Mirza, a destiny fulfilled
In a country where female sportstars don’t get their due, this piece in scroll celebrates the storied career Sania Mirza, the ace tennis player from Hyderabad, who retired last month. In an international tennis career spanning two decades, Mirza achieved more success than any other Indian tennis player this century. Her Wikipedia page says: “A former […]
Why Smart People Believe Stupid Things
We often find ourselves in seemingly intellectual debates especially around political and social issues with who we think are like minded rational people but to no end. Turns out we all carry our ideological biases despite claiming to be intelligent people. Indeed, the greater the intelligence the stronger the bias, according to Gurwinder Bhogal who […]
Why the Medallion Fund is the Greatest Money-Making Machine of All Time
Four years ago Greg Zuckerman of the Wall Street Journal published an excellent book called “The Man Who Solved the Market” on Jim Simons, the mathematician who has built Renaissance Technologies and turned it to a mega fund capable of generating mega returns over the course of several decades. Even though Renaissance is super successful, […]
Beyond the balloon: the US-China spy game
Across the world everybody wants to know why is China so openly so explicitly provoking America by flying these giant balloons across America (with equipment inside the balloon whose end use is not clear). This long read in the FT says these balloons are a sign of escalating tensions between US and China: “The appearance of […]
Global Compounders: Investing in the Most Powerful Global Franchises
Marcellus’ Global Compounders Portfolio (GCP) invests in 25-30 deeply moated global companies (listed on developed countries’ stock markets) based on rigorous bottom-up research around moats, capital allocation and sustainability of cash generation into the long term future. Consistency of free cashflow compounding of GCP companies is an outcome of: (a) the nature of products and […]
Short Term Excitement vs Long Term Wealth Creation
Every year there will be a couple of sectors and a handful of stocks that give outsized returns helped by short term earnings momentum and narratives around the same. However, such sectors and stocks are generally unable to replicate their short-term success over the medium to long-term. While chasing momentum can provide short term enrichment, […]
The Buffett Formula: Going to Bed Smarter Than When You Woke Up
Most of us aspire to become better at what we do through a process of continuous improvement. But we also recognise it is easier said than done. So, here’s a timely revisit of the ‘why’ and ‘how’ of it from the folks at Farnam Street using the example of the best-known learning machines in the […]
Pakistani brides falling for Indian designers and ‘Sharia-compliant’ Sabyasachi lehengas
It seems that Indian movies are not the only Indian offering that is being lapped up in Pakistan. For the great and the good in that country, Indian fashion designers’ clothes are also items to be coveted and flaunted on major occasions: “Tarun Tahiliani, Anamika Khanna, Abhinav Mishra, and Gaurav Gupta are selling big in […]
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