@jitenp Any agri / fertilizer company you are adding right now ?
Hi Sir
How to identify a sector bottomed out. is there any process to analyse. i want to learn that. Any books are material is there please share. How do u approach a sector/cycle before it start moving up. If will be very helpful if you share your investment process. what is the next trending sector in your opinion .
Please see the presentation at the start of this thread. that gives an idea about cycles and how to identify them.
The sectors I am bullish on is infra, cement, agri/fert and select private sector banks.
Update:
I have exited fully from sugar and paper. Superb gains of 7x and 6x respectively. Paper still in sweet spot but situation can change and I believe we wouldn’t have multibagger returns from here. Same with sugar. Enter early and exit early has been my way of doing this, to avoid regret later.
Had build positions in steel, mining too. And these look good for some more time. May even add some more in these.
Infra, cement too I am increasing allocation.
-Jiten Parmar
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Hi Jiten,
Have you looked at tea stocks? Seems to be at an inflexion point with crop in Kenya getting affected by drought. Also, management commentary from Mcleod & Jayshree Tea is quite encouraging.
And thanks a lot for detailed discussion on commodity & cyclicals, has been an eye opener for me.
Like this sector from commodity price of view. But have seen that stocks don’t perform as well. Many stocks, the management leaves a lot to be desired.
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Which companies in infra, cement space you are targeting? Turnarounds or leaders? Smallcaps? Midcaps?
Can you also share your picks in Cement and Steel sector?
Thanks, @jitenp for the update, and as always this thread is good learning for me on the commodity play.
I personally tried commodity sector investment first time in Dec’15-Jan’16 period with NALCO and GMDC, and both have given good returns. Theme for me was mix of cycle play and value buy on strong balance-sheet players and kind of monopoly.
Curious to know when you mention mining in your earlier post, is it a commodity play with RM integration like NALCO, or just players like GMDC? I am now preparing for exit from NALCO, as the story may be at peak now. Thanks!
Disc: invested in the stocks mentioned and my views may be biased. This is not a recommendation.
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@jitenp Hi Jiten, fabulous presentation. One thing that I wanted a view on is how do you account for management while selecting the companies. Is it a strict no to go with companies with past records of poor governance or one should manage with allocations to take advantage of the higher gains they offer ?
Management is important. Since, approach is of a basket, see that atleast 4 companies out of the basket have good managements. I take a chance with mediocre management with the 5th or 6th company. Overall, the stress test that these companies can survive atleast another 2 years if cycle doesn’t improve is the most important factor.
eg BILT in the paper basket. Which obviously didn’t work out. But in sugar, it worked out well with Ugar Sugar.
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My mining sector plays have been MOIL, NMDC and NALCO. Am still invested in these as cycle is still favorable.
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As a basket, what is your opinion about investing in Everest, HIL and Visaka?
I have invested in HIL. Did not make a basket here. But, do understand that
stocks have runup a lot.
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Steel basket doing well. I had added more to them recently. Have added some mining plays like NMDC and MOIL too.
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JKIL and Prakash both get stays from SAT and trading to resume tomorrow.
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Hi I m Sangita mall.doing investment since 15 years .I do not understand technicals so want to learn. invested in Prakash @ 50 and jkil@ 200.what would u sayregarding these companies
I too don’t understand technicals. Am a zero in it. There is some unknown for which MCA initiated list to SEBI. As of now, I am having open mind on these 2.
have a look at sunflag steel …
Steel sector seems like turning around…china cutting production driving steel prices up…increased demand with push to infrastructure.
And prices of all steel companies seem to be supporting this.
Please experts share your views on this