Investing Idea - Ashiana Housing

Real Estate Business

What is the first thought that comes to your mind when you think about real estate developers in India? Some of the most common words are fraud, corrupt, scam, bubble etc. Every Indian aspires to have a house of his own. If they are fortunate enough to realise their dream, they are hit by all kind of scams by developers such as deliberate delays, false promises, deviation from approved plans etc. This has tarnished the image of all real estate developers in India. 

A simple business

Let us change topic for the time being and look at a very simple business. Lets call this business - “Magic carpet” business and it is run by a chap called Ali. Initially Ali puts in $100 to buy special thread to make magic carpet. Ali has to hire some expert hands to weave this carpet, pay some royalty to Aladdin and so forth, which in total costs him another $250.

With his goodwill and reputation, Ali already has a buyer who always dreamt to fly around the world on a magical carpet. The buyer has agreed to buy the carpet for $500 and agreed to pay advance payment of $250 and remaining payment during handover. Ali uses this advance payment to hire expert hands to weave the carpet, pay the royalty etc.

Ali keeps up his promise to deliver the carpet on time for the buyer to fulfil his life long dream.

Ali can now turn around and once again buy thread worth $100 (keeping balance $50 for himself) to weave another carpet. His reputation and possibly the referral from his previous client helps him to find a buyer who is ready to make advance payment. Once again Ali delivers the carpet on time and the cycle continues. Ali's reputation is having a snowball effect.

Looking at this wonderful but simple business, others jump in and start something similar but with a twist:

1. Buying and stocking the thread in an expectation that thread prices will go up as demand for carpet increases. Why build anything when you can make money trading?
2. Redirecting the advances from customers into buying thread at the cost of delaying or not even delivering the carpet to customers
3. Taking as much debt as possible to buy more and more thread
4. Delivering a carpet that can only crawl rather than fly
5. Trying to make carpets jaded with Swarovski crystals for customers with a rich taste

It is not hard to imagine why many of these businesses would fail.

Meanwhile, Ali has started doing Joint Ventures on revenue/profit sharing model with other people who own the thread but do not have the experience or reputation to build a truly magical carpet. This makes his business even more profitable and asset-light.

Ashiana Housing

Let us replace the magical carpets with simple homes and you will get a wonderful business that started operations in1986 named Ashiana Housing. Ashiana mainly builds houses for middle-income group (Comfort Homes) and senior citizens (Senior Living). You can check the latest presentation of the company to get more insights about the company and its operation.
Ashiana Housing latest presentation

So what makes Ashiana housing business wonderful and different from other run-of-the-mill real estate developers?

Asset Light model – Ashiana enjoys a moat that is float.

Float in its simplest form exist in Insurance industry. In case of the insurance industry, float is the money that an insurance company gets to hold onto between the time customers pay premiums and the time they make claims on their policies.  In fact, this collect-now, pay-later model is central to the way the insurance industry operates.  No matter if a company generates an underwriting profit or loss from its core business, it can still earn investment income from the float.

The source of float in case of Ashiana Housing is the advance from customers. Ashiana Housing does not use these advances to earn income through investments but is able to cover the cost of construction through these advances. This is similar to raising interest-free debt. Naturally if used properly this free leverage can generate superior returns for the company.

Ashiana has generated high gross advances from customers over the years.

Insurance companies run in trouble when they not only underwrite at a loss to generate premiums but also are unable to invest the float wisely to generate enough returns. Real estate companies run into trouble when they divert customer advances in investments unrelated to core business and delaying the delivery of homes to customers.

A low-cost manufacturing company rather than Construction Company

1. Land is considered as a strategic raw material rather than a speculative investment for capital gains. Ashiana Housing keeps a land bank of 6-7 times the annual construction rate and land is acquired keeping in mind the burn rate (% of land consumed from the total land inventory) which is typically 15-20%
2. The business operates more like a manufacturing hub where the objective is to constantly churn out good quality product on a timely manner and keep the operational cost minimal and efficiency high. Ashiana has low construction cost due to simplistic construction such as mid, low-rise development with stilt parking rather than basement etc.
3. The company strives to constantly improve the delivery timelines to improve cash conversion cycle. The company has been able to squeeze delivery time from 30-36 months to 24-30 months by process improvements.

Enjoys brand reputation and goodwill – Ashiana housing, over the years has built a reputation to deliver quality homes on time. Other strategic initiatives to build brand includes:

1. In-house facility management enables the company to keep the facility in good condition and take action based on direct feedback from customers. Ashiana also provides resale and rental services to facilitate easy exits for the customers. This helps build a reputation and brand loyalty among customers.
2. Direct Sales channel – The outcome of perverse incentives in real estate selling is well known and experienced by many homebuyers. In order to avoid customers being misled by intermediaries, Ashiana undertakes all bookings. Varun Gupta, Whole-time director of Ashiana Housing, sums up the key reason for direct sales channel brilliantly. 

All these efforts have led to a high customer satisfaction rate and a high proportion of customer referral sales to overall sales is a testament of its brand value and reputation. Ashiana also enjoys better pricing and better terms from customers.

Debt free – While other real estate companies are burdened with debt, Ashiana has managed to keep itself relatively debt free. Current debt to equity ratio is 0.06

Good accounting practice – Let us first understand why accounting policy reflects the character of the management, which is summed up brilliantly by Charlie Munger is his paper “The Psychology of human misjudgment”

"Where you see in business just perfectly horrible results from psychologically-rooted tendencies is in accounting. If you take Westinghouse, which blew, what, two or three billion dollars pre-tax at least loaning developers to build hotels, and virtually 100% loans? Now you say any idiot knows that if there’s one thing you don’t like it’s a developer, and another you don’t like it’s a hotel. And to make a 100% loan to a developer who’s going to build a hotel... [Laughter] But this guy, he probably was an engineer or something, and he didn’t take psychology any more than I did, and he got out there in the hands of these salesmen operating under their version of incentive-caused bias, where any damned way of getting Westinghouse to do it was considered normal business, and they just blew it.

That would never have been possible if the accounting system hadn’t been such but for the initial phase of every transaction it showed wonderful financial results. So people who have loose accounting standards are just inviting perfectly horrible behavior in other people. And it’s a sin, it’s an absolute sin. If you carry bushel baskets full of money through the ghetto, and made it easy to steal, that would be a considerable human sin, because you’d be causing a lot of bad behavior, and the bad behavior would spread. Similarly an institution that gets sloppy accounting commits a real human sin, and it’s also a dumb way to do business, as Westinghouse has so wonderfully proved.

Oddly enough nobody mentions, at least nobody I’ve seen, what happened with Joe Jett and Kidder Peabody. The truth of the matter is the accounting system was such that by punching a few buttons, the Joe Jetts of the world could show profits, and profits that showed up in things that resulted in rewards and esteem and every other thing... Well the Joe Jetts are always with us, and they’re not really to blame, in my judgment at least. But that bastard who created that foolish accounting system who, so far as I know, has not been flayed alive, ought to be"

In 2012, Ashiana shifted from POC (Percentage of completion) method to contract completion. An extract from Fy2012 annual report explains the merits of contract completion method 

Broadly, real estate companies follow two type of accounting policies—(1) percentage of completion (POC) method, and (2) contract completion method. Within each of these, companies have different thresholds before they start booking revenues.
We shifted from the contract completion to POC method in 2006. Benefits of POC method are that as the construction happens and sales get booked, revenues are recognized and so there is a smoothness in reported revenues over quarters. Under the POC method, revenue gets accounted after a certain minimum cost threshold is reached, which can vary from 5-10% of total budgeted costs to as much as 25%.

However, POC method does not reflect market risks, liabilities and assets accurately. Till the delivery of the unit to the customer, the entire amount received from the customer is a liability for the company and the risk of ownership of the property is only transferred upon delivery of the unit to the customer. For example, the company had recognized revenues from the Utsav, Lavasa project under POC method, and then the project was put on hold by the Ministry of Environment and Forest. Now one must ask what was the liability of the company if that project had not received eventual clearance and had to be discontinued. The liability of the company would have been to refund the entire amount received from the customers of Lavasa and not the amount reflected in the Balance Sheet, which was reduced by the amount of revenues recognized from Lavasa. The POC method understates both the liabilities and assets of the company. It is also our belief that for a real estate company, the balance sheet is the more important indicator of the financial health of the company as compared to the profit and loss statement because our operating cycles tend to be in multiple accounting periods.

Under contract completion, revenues are recognized when the unit is completed and either possession is transferred or deemed to be transferred to the customer. Till that time, whatever cash inflows happen from customers on the projects are recorded in the current liabilities under ‘Advance from Customers’ and direct expenses incurred are accounted in ‘Work in Progress’ under inventories in the Balance Sheet. Revenue recognition gets lumpy as units tend to be delivered in batches and not continuously. It also delays revenue recognition till the completion of units.

The next two years will be a transition phase when the projects nearing delivery have had been accounted under POC method and all the projects under contract completion will be in-construction mode, hence creating volatility in revenues reported. Revenues and profits recognized in the next two years will be significantly lower than that recognized in previous years and will not be comparable to the previous years figures. So for the coming couple of years, it will be difficult to compare the growth of the business through income statement. The best way will be to look at key growth drivers like sales booked, construction done and operating cash flows generated. However, the long-term benefits of contract completion accounting by far outweigh the short-term transition issues involved. As outlined earlier this conservative method of accounting will more accurately reflect the assets and liabilities of the company. This will make it easy to understand the operating cash flows of the company, which is one of the most important parameter to appreciatethefinancialhealthofthecompany. Itwillalso better reflect the margins of the company, as they will be directly linked to the delivered homes and square footage and not subject to future estimations of project cost.

The other benefit of contract completion accounting to the company is that it will help maintain the financial discipline for the business as a whole. The ‘Advance from Customers’ in the liabilities side and ‘Inventories’ in the assets side will let us help in ensuring that the cash inflows from one project are utilized towards the cash outflows of the same project. It will be apparent if advances from a project are utilized to procure land of another project. Lack of discipline around this has been the bane of the industry and has resulted in project delays and mismatched cash flows for many developers. We at Ashiana clearly want to avoid this mistake. Also, contract based method is in compliance with IFRS standards and it will be an important aspect in making our financial statements comparable to those of international players. Whenever it is adopted by the industry at large in India it will help in making the companies comparable on key drivers.

The shift to contract completion method of accounting from POC method will bring with it short-term pain in terms of reported revenues and profits for the next two years. It will make our profit and loss statement more volatile and not comparable on a quarterly basis. But, the contract completion method of accounting better reflects assets and liabilities of the company. It will easily reflect the company’s financial discipline or the lack of it in utilization of advances from customers. It will create incentives to deliver faster to ensure revenues get reported. Cash flows of the company will be easier to comprehend and margins will not be subject to estimations of future cost. Contract completion method of accounting has its shortcomings but overall it will better capture the financial health of the company. 

And here is Varun Gupta’s (whole time director of the company) explanation on the change of account policy

"We have just moved away from the percentage of completion accounting totally to contract completion of possession accounting whichever word you want to use where you would recognise the revenues at the time of delivery of the flat to the customer. So what happens is if you have a two-year cycle of operations instead of revenues getting recognized every quarter over eight quarters, it gets locked into the last quarter. So it delays the revenue. But what it benefits as it gives a better sense of the liabilities of the company that the money has been received from customer against which deliveries have not been made. It also puts incentives to deliver faster to have revenue recognition coming in which is a very important aspect of the business. And third, we are in the business of selling homes and building homes and delivering homes to our customers. A basic situation over there is the customers have a binary situation, a customer thinks either he gets a flat or he doesn't get a flat. My customer is not there to take up half built project and say 50% construction is done, they will take it. The liability only gets set up at the end of delivery, so that is the basic reason for it and the difference is that the revenues get recognized at the end of the year"

Future of Ashiana Housing

1. Joint development model – Ashiana housing is banking on its reputation and execution skills. One of its strategies to scale up is by joining hands with landowners in new markets by way of profit sharing, area sharing or revenue sharing. These partners bring in land, local expertise of the regulatory know-how and Ashiana brings in its execution skills to create value for customers.
2. Entry into new markets – Ashiana is entering new markets such as Chennai, Kolkata, Gurgaon etc. to scale the business to new heights. These new markets present as much risk as opportunity for the company.

Valuation of the company

Ashiana aims to become a “square foot making machine” meaning they target to build a certain square foot every year. So the most logical way to value this company would be to forecast area build every year, estimated growth rate, realization rate, margins and apply a multiple to that value.

Assumptions:

1. Estimated growth in area constructed, area booked, gross margins and PAT margins is 5 year average.
2. Since Ashiana follows contract completion method and takes around 24-30 months for delivery of the homes, revenues are captured after 3 years. So revenues for FY16 will be for area constructed in FY13.
3. Revenues were lumpy from FY12-FY15 because Ashiana changed the accounting method but going forward it should normalize and revenues should grow in line with the area constructed and area booked.
4. Assuming a multiple of 15 gives a market capitalization of INR44.99billion, giving a CAGR return of 14.92%. The current industry multiple is around 15%

However, as mentioned earlier given the change in accounting method there has been some lumpiness in the revenues. So looking at the on-going projects that are scheduled to complete by FY17 gives estimated cumulative revenue of INR11.73billion and PAT of INR2.93billion (compared to cumulative PAT of INR2.08billion under the above method). Here we have assumed economic interest is shared at revenue level which may not be the case.

Most real estate companies are valued on EV/EBITDA as cash flow is like oxygen for these companies, not only to continue construction but also to acquire land and service its highly-levered balance sheet. It is also difficult to track revenues and PAT as almost all firms use POC (Percentage of Completion) method of accounting, so EV/EBITDA becomes a de-facto valuation method. However I'd think that P/E multiple is a better way of valuing Ashiana housing as the balance sheet is not leveraged and accounting is "contract completion" method. Ashiana has negligible debt and interest cost, so EBITDA is also the Pre-tax income for the company.  The issue in applying a multiple to earnings though is that Ashiana may have to dilute the equity again in future if they want to continue to grow at 15-20% for next few years.

Ashiana is currently valued at 6x EV/EBITDA based on expected EBITDA of INR3.2b from on-going projects that are scheduled to finish in next 2 years.

Apart from the on-going projects, Ashiana has projects of 8million square feet saleable area in pipeline and another 4.9million square feet of saleable land bank for future projects translating into 6 years of development activity at the current burn rate. This provides enough visibility and predictability in its earnings for next couple of years.

Importance of Modified pre-tax cash flows

Ashiana publishes pre-tax cash flows of all on-going projects quarterly and annually. This helps the management to understand the cash flows on a short-term basis. For investors these cash flows provide insights on the financial health of the company as well as its ability to generate cash to buy additional land to replace the land consumed in construction.

QIP and use of the cash flows - Ashiana has raised INR2billion through a QIP recently and estimates INR4b of cash flow in next years giving total cash balance of approximately INR6b. Ashiana plans to use the proceed to buy approximately 15-17million square feet of land for replacing the consumed land and estimated growth in area constructed.

Ashiana will not be able to pay any dividends, and in fact may have to dilute equity further to procure land if they want to grow 20% in terms of constructed area which means that have to buy 1.2x of the land consumed annually.

Risk factors to consider

1. Inability to generate cash flows and customer advances - If, for any reason, the booking slows down then Ashiana will have to deploy more capital to undertake construction which will hit the company's operating margins.
2. Increase in taxes – Historically Ashiana Housing was paying taxes under MAT due to tax incentives on certain kind of housing but going forward these incentives will exhaust and will be taxed at full rate from 2015-16. However a lot of income in the books in post-taxed as the income flows from SPV where the tax is already paid.
3. Inability to penetrate successfully in new markets – Ashiana’s goal to grow and build more houses depends on its ability to successfully penetrate into newer markets such as Chennai, Gurgaon, Kolkata etc.
4. Regulatory overhang on the real estate industry in India

Disclosure: The article reflects my personal thoughts on the company and is not a recommendation to buy or sell the security. 

Investing Idea - Repco Home Finance

Banking and NBFC business in India

For any economy, banks and financial institutions form a backbone and perform the very important task of lending to businesses and individuals. For a credit business to make money, it needs a strong foundation on three main pillars

1.     Ability to find credit worthy customers to provide loans

2.     Ability to raise money to fund these loans

3.     Ability to recover the loans (principal + Interest)

If you look at any bank or NBFC in India to understand its competitive strength (or moat), you will see the moat lies in the combination of these three pillars.

A bank needs ethical, focused and disciplined management to protect and strengthen these pillars. It takes discipline and courage to walk away from business if it qualitatively and quantitatively weakens these pillars. Easier said than done, and so we find many banks/NBFC’s burdened with bad quality assets, low NIM (Net Interest Margin) and very high NPA (Non-Performing Assets)

Why is the housing finance segment so attractive for Indian banks/NBFCs? 

According to research reports, the current housing shortage in rural India is 40 million and urban India is 19 million houses. This shortage will creep up in future with rapid urbanisation, nuclearization of families, creation of new cities and people’s aspiration to have better homes and lifestyle.

Housing finance business is perceived to be a simple business. You raise capital, find couple of aspiring homeowners to finance a home backed by salary income and keep the financed house as collateral. With conservative LTV (Loan-to-Value) and increasing asset prices, you can hardly run a risk of bad loan. The borrower would default on its house (valuable asset) as a last resort. At least it sounds simple.

Safe risk spectrum and rising demand makes it very attractive for most financing companies, but the same proposition also makes this business very competitive. Almost every national or regional bank is active in this segment. Apart from the organised banking sector, there are thousands of individual lenders especially in semi-urban and rural segment milking aspiring homeowners.

Size and structure of housing finance market

As of June 2014, the outstanding home loan book stood at INR11 trillion. Top 5 players (SBI, LIC, HDFC, ICICI and Axis Bank) command 56% of the market share.

Various reports suggest different growth rates for this segment but one can conservatively estimate the growth to be at least couple of percentage points above GDP rate.

Most companies operate in urban market and target HIG (Higher Income Group) with large loan ticket for obvious reasons. It is lucrative to find a cow that gives 10L of milk/day versus 10 cows with 1L of milk/day, even though the risk of one dead cow translates into 100% loss of business in former case vs. 10% in latter case. No wonder that many banks are sitting on high NPA it their attempt to milk fat corporate cows.

Most companies target salaried professionals because it is easier to do credit assessment for such borrowers. It is similar to investing only in well-known companies than to make an effort of researching smaller companies without widely available information. However self-employed comprises of 50% of the total workforce in India.

Repco Home Finance (RHF)

Among the many players in home financing, one of the smaller player is Repco Home Finance. 

Lets go back to the three pillars we talked about before and understand if it provides any competitive advantage to Repco Home Finance

1.     Ability to find good credit worthy customers to provide loans – Repco Home Finance focuses on:

• Providing loans to segments underserved by larger housing finance companies and banks.
• Providing loans to mainly self-employed professionals and self-employed non-professionals.
• Tier-2/3 cities and peripheries of Tier-1 cities.

Why is this segment interesting? As stated before, self-employed comprises about half of the total working population.

So why is this segment under-served? Banks like to feed the elephants rather than little ants.  They like to feed the HIG (High Income Group) who can take a large loans rather than feeding hundreds of borrowers with small loans. Secondly serving the self-employed borrowers calls for lot more work in credit assessment.

Hence this segment is currently served (or rather exploited) by individual lenders who charge extremely high rates and have no tolerance for slippages in repayments.

Enter Repco Home Finance – it provides a structured alternative to this group of underserved borrowers. Its focus on underserved market also greater provides greater pricing power to the company.

This is all fine, but how does it provide any sustainable competitive advantage to Repco?

a. The real moat here is credit assessment of self-employed people who do not have standard documents such as tax returns, salary slips, accounts of business etc. The interest rates are based on credit score and loan amount is based on LTV (Loan-to-Value). As they continue to serve the self-employed from various different industries and background, they are able to create credit assessment models which will take years for competition to replicate.

Stringent risk management controls delinquencies. Same person is responsible for origination, appraisal, monitoring and recovery of the loan and his/her compensation is tied not only to origination but also to timely recovery of the loan. This risk management process indirectly puts constraint on the company to grow very quickly due to shortage of trained man power as it takes more than 6 months to train a employee.

b. The second moat is network effect – as the company goes deeper into Tier-2 and Tier-3 cities they are building reputation as the only alternative to individual lenders who charge much higher rates. As the company assesses the credit worthiness of the borrower by speaking to its neighbours, landlords, customers, suppliers etc. they are indirectly able to spread the awareness about Repco Home finance business.

2.     Ability to raise money to fund these loans – Repco Home Finance has traditionally borrowed money from conventional sources such as NHB and Banks. More recently Repco has started to diversify its funding by issuing Commercial papers and Non-convertible debentures. 

With interest rates going down and diversified source of funding, its cost of funding will go down but the yields may hold up, providing higher spreads and NIM. Even though Repco can keep the lending rates high, the ethical and sensible business practice will be to keep the spreads at normalised levels by passing the lower interest rate benefits to customers. This will also keep competition at bay.

3. Ability to recover the loans (principal + interest) – The ability to recover loans is tied with the first principle of ability to find credit worthy borrowers. You will find countless examples of banks going under the water due to bad lending practice. As they say “You only find out who is swimming naked when the tides goes out”

In case of Repco Home Finance, it becomes even more critical to look at the quality of the loan book and NPA because it serves the unconventional self-employed category.

Now for a moment let us think from the vantage point of a borrower - 

I run a small business and I’ve been working hard for years to provide food, shelter and clothing for my family. I now have enough savings to put down initial down payment (50% of the value) to buy a house. Apart from a having a house of mine it will also be my tangible hard asset. My earnings are lumpy as I make most of my money only for few months but I’m confident to be able to pay my instalments, as the instalment value is less than 50% of my income. If things get worst, I’ll cut down on other expenses but make sure to pay my instalment as this house is my appreciating asset and I’ll not give away my asset. In fact I want to work hard to get this loan off my back as soon as possible. 

Repco lends to such aspiring home owners who put up more than 50% of the value of the house up front. They will give up their assets only as a last resort when they have given up everything else. However given the seasonality of their earnings they might fall behind in instalment repayment schedule but will make up as soon as the earnings pick up. This seasonality is obvious from the quarterly NPA movements of Repco.

           

Loans written off since inception is just 4.3cr which is 0.06% of total cumulative disbursements proves the point that borrowers would not easily default on their asset.

But what happens if there is a serious property crisis and house prices fall sharply? Indian housing market is not highly levered. Mortgage to GDP is just 9%, meaning borrowers do not take leverage to “invest in property”. These rural and semi-urban borrowers buy houses for dwelling and not investment. Secondly the LTV is around 50% unlike the mortgage situation in the west where banks lend the full value of the house plus more. 

Repco borrowers will not suddenly vacate the house and default because the prices have fallen sharply. Such crisis mainly impacts borrowers who are leveraging up to buy expensive urban properties as an investment which is not the target client of Repco.

Repco is trying to provide further comfort by making higher provisions for NPA, but that will naturally have an impact on the profitability of the company

Other Important Points

One can look at other metrics such as geographical presence, branch expansion, cost-to-income ratio, OPEX/branch, management quality, Capital adequacy ratio etc. to get further insights about the company. Those metrics are only building blocks on a strong foundation, but the key is to focus on the three key pillars highlighted before.

Future of the company

Most financial companies are evaluated on the basis of Price-to-Book ratio, Return on Equity, Return on Assets etc. but one needs to look beyond these textbook methodologies to understand and evaluate certain businesses. One needs to apply different mental models for evaluating different businesses.

India is a growing economy with a major part of population going into working class soon. These people will need three basic things in life – food, clothing and shelter. Though property prices have been going up, house affordability is increasing as well and ownership of a house continues to be a life long dream of every Indian.

If we just look at the current shortage of houses and the fact that Repco is currently has only 57500 accounts will give you an idea of opportunity ahead. One also needs to keep in mind that Repco has been able to grow the loan book at 35% CAGR from 2009-2014 when the Indian economy was at its worst, so Repco should certainly do better in good times. 

Government initiatives such as Housing for all by 2022, tax breaks, lower risk weights and CAR etc. will provide further tailwind to this sector but that should not be the premise of any investment.

I do not want to extrapolate the numbers based on expected growth rates in loan book, ROE, book value etc. to derive at intrinsic value of the business because good businesses cannot be deduced to few textbook variables.  

Risks

1. Economy downturn and substantial increase in interest rates
2. Regulatory changes that may put housing finance companies at competitive disadvantage
3. Deterioration in risk management and credit appraisal quality in its quest to grow very quickly

Disclosure: The article reflects my personal thoughts on the company and is not a recommendation to buy or sell the security. I'm an investor in Repco Home Finance.

Why Blog?

Just because one starts doing something doesn't mean that he knows the motive behind it or embraces that idea completely. This is exactly my dilemma with blogging? Very often I ask myself "Why blog?" Why do we want some unknown person, in some remote part of the world know about your opinions or feelings in a digital form and in some way relate to us, support our thoughts or even reciprocate to it? Why can’t we confine our thoughts to ourselves?  Is it because we want someone to affirm our ideas or is it just to convey the superiority of our knowledge over someone else or is it just to pen down our thoughts of the day to kill time. Sometimes it is purely for commercial reasons such as celebrity blogs, food blogs, business blogs etc. In some cases it is out of profession such as author’s blog, critic’s blog etc

I'm neither an existing or hopeful celebrity nor does my boring job requires any kind of blogging. In fact I work in an industry where time is money and I’m naturally not living up to its principle by spending my time in typing these blogs. I don't have any interesting stories (at least the ones that I can share without putting a child lock on this website) or any wow factor in my life which makes my blog unique. Last couple of lines also proved how bad I’m in marketing myself and naturally not helping sell my blog.

We have all heard that "we should live life to the fullest and live every moment as if today is the last day of your life". In this beautiful journey of life, there are moments when your mind is loaded with amazing thoughts (usually happens to me when I’m tied to a tiny seat that is floating 35000 feet above ground with couple of drinks down the throat) and you want to capture those thoughts. It’s like photography. You are capturing an experience, a moment and, creating a memory out of it that you can cherish for life. Your thoughts are all like small drops of moments that may fall upon you from experience of any of your five senses, or just wander wildly from some unknown world, and it is great to capture them and share it with your friends and strangers-waiting-to-be-friends. These thoughts can inspire people, uplift their mood or even put them on the right path to follow their dreams. Thoughts are very powerful and Buddha summed it by saying "We are what we think. All that we are arises with our thoughts. With our thoughts, we make our world"

My blog is my humble way of sharing my world with you. I hope it will make your world as beautiful as mine. I guess this is a reason good enough for me to spend (in my financial term "invest") my precious time blogging.