Another useful email that I got was related to investing in the Indian stock market, especially after the crash and the learnings from that. Topic of the email: How to invest in stock markets?

1. Select businesses with good growth opportunities. Read business magazines that offer research on good businesses and read those articles thoroughly.
2. Select 1-2 good companies in those businesses.
3. Never enter into any stock at unreasonable valuations. Just because a company is good is no reason to buy the stock if it has already run up.
4. Penny stocks are manipulated by big brokers. Never look at them in your life. Take an oath.
5. Good stocks quickly regain their value.
6. Never be sentimental with any stock. A stock is not related to you, and there is no such thing as loyalty in the market.
7. Best stock ideas arise in day to day life like investing in ICICIC Bank stock in 2002 after experiencing their wonderful service when you fed up with Public sector banks. Always look for opportunities.
8. Invest in future sectors. How many of us invested in Infosys in 1997 and Bharti Airtel in 2002? But be careful and selective and do research.
9. Buy and forget will work only to some extent. Indian markets become high volatile zones. There is no reason in keeping your money after RPL reached 300 and RNRL reached 250.
10. If you can’t follow all these things, just put your money in good mutual funds.

I came across this post in an email about a sort of checklist about whether to invest in an IPO and thought that this was worth sharing; even if this helps a few people, it will be worth posting.

How to decide whether to invest in a particular IPO?
• First and foremost, find out the listed peers in the secondary markets and if IPO is at a higher valuation then there is no justification for investing.
• Check the results and growth rate in term of sales ,profit growth ,operating margins growth for the last 3-5 years and not only for 1 year as there are chances of financial engineering (manipulation) of balance sheets just before the launch of the IPO.
• Check the background of the promoters and if there are any serious criminal/income tax evasion cases against then avoid the IPO; typically crooked people are easily able to cook the books when trying to do an IPO
• Find out the purposes of raising the money. Some justified reasons are expansion of capacity, new projects, while if the sole purpose is meeting the working capital needs or repaying the debts then it does not inspire enough confidence to invest in that IPO.
• If the IPO is for a new project then we should check the turnaround /breakeven time. One example is Reliance power IPO where this time was huge and hence took a beating (projected capacity of Reliance power in next 3-4 years was less then current capacity of NTPC).
• Study the risk factors in the draft prospectus and see if they are of real concern or acceptable risks in the normal course of business.
• Check the subscription figures in QIB category as they are considered to be smart /intelligent and have access to lot of company information that retail investors do not have. Of course, this is not always true, but this is still a good indicator.
• Check the future growth prospects of the company and if the future expected growth is huge or they are operating in a niche segment or in a high growth sector for which no listed companies exists in secondary markets, then higher valuations may be justified.
• Never go by the grey market premium(GMP) of a particular IPO to make your investment decisions as they can vary daily and are mostly speculative in nature. (E.g. Reliance Power IPO having a GMP of 450 listed at a premium of Rs 10-15 only while TItagarh IPO having a GMP of Rs. 10-15 listed at a premium of Rs 150).
• Subscription figures in Employee quota can tell you whether the employees themselves are confident of the future prospects of the company.
• Some other indicators of the quality of an IPO can be the rating given by the agencies like ICRA, CRISIL or the reputation of the Book running lead managers(Example is Enam financials which manages only quality IPO’s)
• Keep in mind allotment chances as well besides the quality of the IPO. A medium quality IPO with good subscription chances can give you better returns then a very good IPO with very less subscription chances.
• Do not consider any of the above factors in isolation but look at them together to arrive at any conclusion.

And of course, if there are additional factors that you use to evaluate IPO’s, please mention them in a comment.

Most of us take a banking account for granted, not bothering to pay much attention to the bank unless we have a need or if something goes wrong. When was the last time you bothered to validate all the statements you got from your branch with the actual transaction record ? This seems like something legitimate, after all, there are many things to do in life and who could be bothered with spending so much extra time to ensure that every last dot in the banking records is fine. It required effort, attention to detail and follow-up. However, there are things you can do that do not require much additional time and will help in ensuring that your banking details are fine and accurate:
As a personal bank customer today, you need to be cautious and pay close attention to activity in your account. Bank errors and the potential of identity theft have made it imperative that you become proactive and follow simple safeguards. In addition, changes in bank policies can create confusion. Here are a few of the most common personal banking mistakes to avoid.
1. Not reviewing your bank statement promptly. The biggest personal banking mistake is not opening and looking at your bank statements when you receive them. This is the only way to know immediately if there is a mistake in the account or if the balance is below the minimum level for which you will be charged a fee. Take a few minutes to look over the bank statement.
2. Paying unnecessary fees and bank charges. Banking is a competitive business. There are banks that charge fees for various services and others that do not. Don’t pay unnecessary fees because you are too lazy to shop around. Likewise, don’t settle for lower interest rates if there are higher ones at another convenient bank.
3. Leaving a literal paper trail. Leaving discarded bank documents behind makes you an easy target for identity thieves and con artists.
If you make a mistake on a deposit slip, for example, don’t just toss it on the counter or even into the bank garbage can without tearing it up first. All bank documents that you plan to discard should be treated in the same manner — shred them or tear them up into small pieces.
4. Banking online in public places. WiFi access allows you to go online from your favorite hangout. However, you should think twice before doing any online banking transactions over a wireless service from a public place. The level of security is not the same as it is when using your own router.
5. Using an easy password. First, don’t use an obvious password like your birth date. Second, change your password periodically. Third, do not write your password down, particularly anyplace outside of your own home.
6. Failing to take ATM precautions. ATMs can be lifesavers when you need cash. However, you need to be smart and not write down your pin number, especially on your ATM card. Also, do not carry money openly out of the vestibule or use the machine at all if you do not feel physically safe.
7. Signing and endorsing checks prior to entering the bank. People do this all the time to save time. However, if you lose a signed or endorsed check, you can lose the money. Do your signing inside the bank, even if it takes a little longer.
8. Leaving bank account numbers for others to see. If you are reviewing your bank statement at the office, put it in your pocket or purse when you are done. The same holds true for all bank related documents.
9. Assuming you must borrow from your bank. If you need a loan or are in the process of seeking a mortgage, it is not necessary that you give your bank the business. You can certainly include them in your search, but you should certainly shop around.
10. Not establishing a relationship. Whether you are banking online or in person, you should get to know the customer service staff. Meet the branch manager and establish a rapport with the people holding onto your money.

This was very surprising. I was trying to book a ticket from Srinagar back to Delhi for around the 3rd week of June, and started with the regular websites that I was using - Yatra.com and MakemyTrip.com. They both seemed to have around the same lowest fare, on Spicejet. So this seemed fine and I was about to go ahead and make the booking, but then a thought struck about going to the website of the airline directly - in this case, SpiceJet.com
This ticket was being booked for 3 people, and hence the total amount quoted for the booking on Yatra was around Rs. 12,000 (slightly less than that). So imagine my surprise when I went to the airline website and got the ticket for 3 people at around Rs. 1200 less (around Rs. 10,800). This is a decent amount of saving, and not something to mock at, and so set a policy for next time to go to the website of the respective airline to check the prices over there as well.
I wonder whether this was a mistake, or did the website such as Yatra charge extra on some specific times, I can’t imagine them being successful if they start charging extra for every ticket that they sell (most customers will catch on and then avoid booking tickets with them).

In India, low cost airlines came up with a way to make more money. If a passenger booked a ticket and proceeded to travel on the airline, then well and good. However, if the consumer decided to cancel the ticket, then this would be a good way to make some more money. So do 2 things, either make the proceed of money refund so difficult that in some cases the passenger would give up and not claim the money back, or claim that the passenger cannot get a refund and the only way is to get a coupon that would entitle you to travel again on the airline. This can be a problem when you really don’t have plans of using the coupon, since they would expire in some time and that money is gone. I have faced both those issues when I booked travel via SpiceJet and Go. The trip got canceled, and it took around 4 months to get my money back from SpiceJet after some calls including some frustrating conversations where they asked for all sorts of information and twice claimed that their systems were down. With regard to Go, they gave me some coupon redeemable on another flight, and I could not use those (and I regret not forcing the issue by going to a consumer forum for help).
Now, the Government has decided that this will not do, and airlines have to refund money within 7 days:

NEW DELHI: Domestic airlines will no longer be able to hold passengers who cancel their tickets to ransom by delaying refunds indefinitely or by asking them to fly again instead within a given time. Acting on complaints, the government is set to issue new refund rules: airlines will have to issue refunds within a week and cannot swap refund for another flight.
Better still, the new rules make it mandatory for airlines to refund the entire amount of passenger service fee (Rs 225), congestion surcharge (Rs 150) and fuel surcharge (at present Rs 1,950 for short flights and Rs 2,350 for others) on ticket cancellation. Because these three alone add up to Rs 2,325 for flights below an hour’s duration and Rs 2,725 for others, many low-cost carriers have been advertising basic fares of Re 1, Rs 3, Rs 99 or even zero to give the impression that their fares are low and it is taxes and surcharge that have made flying expensive.

These rules are likely to be notified by the Directorate General of Civil Aviation and approved by the aviation ministry last week and DGCA is likely to notify these shortly. This is an excellent move by the Government that should help in regulating the whole issue of fraud in cancellation of tickets, and lead to benefit to consumers. Overall, a great move that airlines would not really like, but something that was long overdue.