Hitesh portfolio


(atul1082) #2749

Sir,
What’s is your opinion on pnb housing finance at current value and maruti?


(Jiitt007) #2750

Hi Aditya Could you pls share the image source site.


#2751

It is a snip from valuresearchonline


(Hitesh Patel) #2752

Posting after a relatively long time.

I utilised the recent correction to rejig the portfolio as I do during most corrections.

Exited the position in PNB Housing mainly because when both PNBHF and Bajaj Finance corrected together, Bajaj Finance was a no brainer replacement. (Still cant find anything wrong with the business of PNB HF except a rotten parent and technically weak setup) Both business wise as well as for the fact that the stock showed good relative strength during a sharp market correction.

Exited the trading positions which I had not exited during January when I had started feeling uneasy about the markets. Recent addition as mentioned earlier is Hikal. It might be a GARP candidate if the kind of growth shown in past few quarters continues.

Bought TD Power, smaller allocation looking at a potential turnaround situation. Positives include a good balance sheet coming out of a few bad years. Plus a management which has been talking in cautious tones all these past few quarters suddenly seems to have changed the tone of their communication in q3 fy 18 concall. If the turnaround does marterialise, then it can provide decent returns. Currently it seems to be under some strong selling pressure.

Some stocks which fit the model suggested in the Next Apple book … Stocks which are first to post fresh all time/fresh 52 week highs coming out of a bear market … aarti inds, first source ltd, a lot of mid cap software/It companies. Another model I follow is to follow stocks which have not broken down below their 200 dema conclusively (one or two transient closes below 200 dema followed by a quick bounce back above 200 dema followed by a strong upmove).

Overall I am still not too certain whether the correction which began in Jan 2018 has finished or this is just a pullback. But the best part about these corrections is that they give a good option to rejig the portfolio to move into better quality/technically strong stocks.


(pssundars) #2753

Hitesh Ji,

Can you share with us the reason for your exit from Bajaj Finance. You having stated it as no brainer replacement, wondering what am i missing. I have been contemplating for a while to enter BF.

Appreciate your response.


(Hitesh Patel) #2754

I had sold out of Bajaj Finance some time back after its stupendous run from the demonetisation levels of 750-800 to 1800 plus. Around 1800-1900 levels there appeared to be some signs of distribution in the stock as it had already started correcting before the market as a whole started going down. When it went down to levels of 1600 odd, it was again ripe for picking up.

Nov-Dec 2017 and even part of Jan 2018 was a good time to play momentum where getting quick 20-40% in stocks was very easy. Thats where the funds from selling of BF came in handy. But suddenly the music started faltering in the middle of January 18 and that seemed to be the warning bell.

The only problem that occurs after selling off quality stocks like BF is that once u start getting quick moves in supposedly poor quality companies there is alway the risk of getting carried away and getting too much into momentum stocks which u tend to keep holding even during market corrections. I also suffered partly from this situation but the earlier gains in other trading picks more than made up for these lapses.


(Neeraj) #2755

Hitesh Sir, what is GARP means?


(Deb) #2756

GARP - Growth at a reasonable price.


(prashbglr) #2757

Hi Hitesh ji,

Would like to understand why did you sell PNB HF and bought TD Power? Is it because you wanted to diversify (as you have bought BF) or you are expecting more return in TD Power? As you said, there is nothing wrong with PNB HF and at the same time I didnt understand why to buy a less performing company in a distressed sector.

Thanks,
Prash


(Hitesh Patel) #2758

@prashbglr,

You have already answered the question. I didnt want too much weightage in the financials space. I think capex revival space could be an interesting space to be in.


(bharat.jain) #2759

Hitesh bhai,
any views of eclerx and persistent systems?


(mp bajaj) #2760

Hitesh Bhai, can you please give your advice about HFCs as a whole. Have seen an extensive report by Nirmal Bang on financials including HFCs especially CanFin. PNB Hsg & Repco. Very bullish on all 3. Need your valuable opinion.


(thecroc) #2761

I have added to my positions in PNB Housing, and Bajaj finance both. I do not believe in the interest rates going up and down kind of stories, and I feel these NBFCs are here for long haul because banks are limited to who walks into their branches and are very laid back ; whereas NBFCs have the required focus and they do reach out to customers.


#2762

Dear Hitesh, Could you please share your views on Canfin homes (business fundamentals / future stake sale possibilities etc)? Thanks


(shyamutty) #2763

Between BajajFinance and IIFL which looks with limited downside sir, also kindly share your views on edelweiss


(Sachin) #2764

Is it a Hammer or Hanging man chart pattern ? what are the key differences ?
Both are trend reversal patterns so it we expect short term reversal of the current uptrend strated from (started from 23-March to till date)


(Hitesh Patel) #2765

@getsach

the candlestick is referred to as hammer when it occurs after a sharp fall and often happens near a bottom. When it happens after a sharp run up nearer to a potential top its called a hanging man.

By itself it may not mean much. We have to watch candlesticks on the days that follow to get a much better idea about the possible trend change.


(Hitesh Patel) #2766

@mpbajaj53

I think HFC rally might have run its course. Atleast the price pattern suggests that to me.

Just to draw parallels to the the situation a few quarters back in pharma space,

US markets were supposed to be the end of the rainbow where pots of gold were loaded for anybody to go and fetch. Now see what the situation is. (just read a report today that generics may be a dying business – though these kind of reports come at the fag end of a prolonged bear market in any sector but thats a different story). Similarly I see a lot of reports and investors quoting limitless opportunity in the HFC space.

In pharma space inspite of great results e.g alembic and torrent, stock prices didnt react and in fact corrected somewhat. Same thing seems to have happened to HFC space atleast in terms of lukewarm reaction to seemingly great results.

In pharma space every other company wanted to go to the US markets where the perceived pot of gold lay. Now it seems markets are rewarding domestic facing and non US exposure (or companies with negligible impact of US markets e.g ipca which has been hit by USFDA sanctions and now is seen more as a non US facing companies – in past few days in fact ipca has managed to post fresh 52 week highs) Similarly I see all the NBFCs wanting to get into HFC space where again the perceived pot of gold lay.

Real problems faced by the pharma space came into picture much later after a lot of price correction had happened. Although currently there doesnt seem to be any headwinds for HFC I would be cautious in my stance atleast if I were paying for rich valuations.

I personally dont subscribe to this limitless opportunity in any space in whatever sector I look at. A pin always lays in wait for puncturing the bubble whenever it happens.


(Hitesh Patel) #2767

@shyamutty

Its a difficult choice between IIFL and Bajaj Finance. Or even edelweiss for that matter. I think the easier alternative is to buy all three of them as a basket and consider it as only one space filled in portfolio among 8-10 contenders (if you are a concentrated investor)


(Mukesh Tolani) #2768

Hitesh bhai., in my humble opinion, quality stocks like Bajaj Finance should never be sold for the reason that they have had recent run-up.
Such quality managements & quality businesses are rare to come across.