Sunday, September 23, 2012

Curious case of Hawkins Cookers

"Every individual, every family, every company, from time to time, goes through hard times.  The hard times may be self-inflicted or imposed by external circumstances.  In my experience and to my way of thinking, it hardly matters whether the hard times are the result of a fault of character or whether they are a result of the forces of history or an Act of God.  What matters is how the individual or the company deals with the hard times.  Whether one is overwhelmed by the misfortune or whether one survives and emerges stronger from the experience, to a great extent, depends upon how one deals with the hard times."

This is speech of Chairperson of a company having tremendious record of capital allocation, honest & intregated management, rich dividend history and having a decades Old brand which we trust in our Kitchen.

I am talking about the "Curious case of Hawkins Cooker". Company is facing different issues since a more than a year now and according to Chiarperson, going through "Hard times" or a special situation as we call in investing term. 

What is problem: Lets dig Chairperson speech again: "Supply was hindered by deteriorated labour relations in our Jaunpur Factory and an order of the Punjab Pollution Control Board (PPCB), dated October 13, 2011, instructing our Hoshiarpur Factory to cease operations in view of their allegation that it was producing effluents with pollutants beyond permissible limits.”

What Management Did/Doing: Well, in this Era, Honesty is something which became undesirable and We know How our Governance is functionaing. But this problem is faced by all "Well Managed" companies like In Bajaj Auto AGM, Rahul Bajaj mentioned How Industries is facing hurdles and now Industries are forced to obey many meaningless rules, he said they will follow "letter of the law" not the "spirit of the law". In other sense this is happening in every aspect of Life where We do not follow the Spirit. Spirit has been pushed to end and Everything which matters is WINING. 

Lets come to topic, So Why to blame this Old aged, MBA Educated Chairperson "Mr. Brahm Vasudeva" who wanted to be Honest and deal issues with honesty. He does not want to hire any "NIRA as Consultant". Honesty has its own price which is being paid by Company and its Shareholders since more than a year, in terms of Restricted Production, Pending Unfulfilled Orders and So Economy of the Company. But what a less price for the Own values if one believes in them. Finally theoretically Honesty has to Win! Not agree? Okay lets see what Chairperson says about dealing the issues.

Chairperson: Jaunpur Factory Issues: "Meanwhile, though there are still some sections of workmen trying to go slow, the factory as a whole is giving much better production than was the case a year ago.  We are hopeful that the matter will be resolved shortly. "

Hoshiarpur Factory Issue: "The Environmental Engineer of PPCB has been directed by PPCB to visit our Hoshiarpur Factory immediately after August 15, 2012, to verify the facts and to submit a detailed report along with his recommendations.  PPCB has declared that they shall decide the matter on merit based upon the report of the Environmental Engineer."

So what is there for Investors:
I was in the Hawkins AGM, and Chairperson who never speculate on any thing, told very confidently that, "All Issues pertaining to this Hard time, will get sorted out very shortly, and this short time is not in years, not even months, but is in Weeks".

Its been 4 weeks now, Any time this Special Situation will get overcome by the Company and the business can reward its patience share holders. Note it, Mind it, Read it again.. As per the Chairperson, this is one of the 4 those "hard time" for the company, and Once Company is out of that mess, That should be the Higher times for its business, so growth and hence earning to stock prices as happened in the past. Boat of Hawkins would sail quite fast after this storm!
So if you are already a share holder, Do Smile and if wanted to make some time pass till these issues sorted out, Solve this Puzzle from a Fundoo Professor: The Hawkins-Unitech Puzzle

Happy Investing!
Note: These are personal views, please as always, educate and investigate self before putting your hard earned money. This article is just for education and sharing purpose!


  1. One Interesting report Hawkins Cookers by HDFC Sec :

  2. Nice Quote from warren buffet:

    "So it's a terrible mistake to look at what's going on in the economy today and then decide whether to buy or sell stocks based on it. You should decide whether to buy or sell stocks based on how much you're getting for your money, long-term value you're getting for your money at any given time. And next week doesn't make any difference because next week, next week is going to be a week further away. And the important thing is to have the right long-term outlook, evaluate the businesses you are buying. And then a terrible market or a terrible economy is your friend." - Warren Buffett


  3. Hawkins Cookers Ltd has informed BSE that:

    "Further to Note No.3 which formed part of the Unaudited Financial Results for the quarter ended June, 2012, published on August 06, 2012, we have to advise all concerned that we have received a No Objection Certificate dated October 22, 2012 from the Punjab Pollution Control Board for our Hoshiarpur factory for manufacturing 5,200 pressure cookers and their components per day, as applied for by the Company.

    Further to the mention made in our Directors’ Report dated July 02, 2012, forming part of the Annual Report for the year 2011-12, we have to report that the Industrial Relations situation in our factory in Jaunpur district has been largely resolved by the signing of a Wage Agreement between the Company and 85% of the workmen and the registration of the said Agreement on October 20, 2012 by the Assistant Labour Commissioner, Varanasi."

  4. In Investing, Patience pays! :-) I am sure, Investors must be smiling on this news!

    Those who got profited from this blog, may think to donate 10% profit to some Child Education program like Lok Kalyan Samiti or better to unfortunate people around your home. The Happiness on their face will satisfy you much better than any profit/Money!

    Remember, Money making in not important, more important is How it is been used apart from Investing again.

    Happy Investing, Friends!

    1. Well said
      "Money making in not important, more important is How it is been used apart from Investing again"

  5. Hopefully Investors have had the patience to hold long, and now enjoying the fruits!

    Do Donate few bucks!