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This is a Crime Scene. Hire a Sherlock Holmes Before You Buy
Jun 29, 2018

Apart from Mohnish Pabrai, super investor Anil Kumar Goel holds arounds 5.2% in the company.

KRBL is already a multi-bagger for Anil Goel. And he has, over the years, increased his stake in the company.

In fact, KRBL has created a lot of wealth for both big and small investors.

However, in the light of recent events, the stock has corrected more than 40% from its peak.

The big question-Is the recent correction a good opportunity to consider buying?

After all, it's a strong business and one of the largest basmati rice companies in the world.

Well, being a Sherlock Holmes fan, I treat situations like this as a crime scene.

And when Sherlock, comes across situations like this, he is sceptical about everything and doesn't fall prey to any obvious mistakes.

I mean, a great business with multi-year growth story available at 40-50% discount to its peak. Should you think of buying?

Many may argue this fall is temporary and the stock will rise again. This might be true.

However, I as editor of Smart Money Secrets, I would rather try to behave like Sherlock.

Well, the first thing I did was check the background of the auditors of KRBL.

I am glad I did.

It turns out, the auditors are allegedly involved in financial shenanigans and manipulating books of accounts by the Central Bureau of Investigation (CBI).

So for now, I will dig some more and stay away from KRBL.

But if I find evidence which makes it a good investment, I may recommend it.

Data Source: Ace Equity, BSE India

This Chart Of The Day was published in The 5 Minute WrapUp - 2 Reasons Why I Didn't Recommend KRBL After Mohnish Pabrai Invested in It

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