Books I am reading

In the first 6 months of the year I read about 33 books (for full disclosure note that a good number were fiction which can be finished in one day). I will probably give the complete list of books I read in 2015 towards the end of the year. After a break of a few months I am back to reading again. As I mentioned before I usually read multiple books at the same time.

The first one I started is the SME Banking Knowledge Guide by IFC. It’s a short but punchy book prepared by IFC to share best practices in SME lending. The book goes into the challenges faced by banks while lending to SMEs and ways by which these challenges can be overcome. What I really enjoyed was specific examples of banks across the world explaining their SME lending model. I have read about 65% of the book and will try to finish it soon. Overall a recommended book for bank analysts because like it or not most banks will see corporate loans shrink and over-competitive. Even though SME lending has its challenges this is an area banks really cannot afford to ignore even if it means near term difficulties.

The second book I am reading is The Granularity of Growth by Mckinsey. This book based on research done by Mckinsey on growth characteristics of a large sample of companies. The major theme of the book is about how growth should be seen from a more granular level than the typical top down view that we have. For example they explain that even in a so called ‘growth’ industry certain products are growing fast while other products may be declining. Similarly, in a declining industry also we can have some fast growing products. Another way to look at growth could be from a geographical perspective. While the book can become a bit monotonous at times, I found their idea of dissecting growth into Portfolio Growth, Currency Affects, Growth from M&A and market share growth to be quite useful. Analysts dealing with sectors that display secular growth characteristics (e.g. consumer goods in frontier markets) than cyclicals will possibly find the book more interesting.

The last and the most interesting one is Why Moats Matter? by Morningstar. The contributors of this book includes the research analysts working for Morningstar. The key idea is to take the term ‘Moat’ (as mentioned by Warren Buffett) and explain it in a more elaborate way. They also tried to explain Morningstar’s research methodology. Overall I found the book quite interesting even though a lot of concepts can be repetition for avid readers on value investing. I think this book should be read along Pat Dorsey’s book The five rules for successful stock investing and The Little Book that creates Wealth.

Asif Khan, CFA

Asif Khan is presently a Research Analyst (Financial Sector) for Exotix which is a frontier market focused investment bank. He has more than 6 years of work experience as equity analyst in both buy and sell side roles across Asian frontier markets. Asif is a CFA Charterholder and has a dual major in Finance & Economics from North South University.

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