@hitesh2710 can you please elaborate on some examples of secular stories in the making and your criteria of classifying a stock as a secular stock.
Regards
Aditya
@hitesh2710 - your views on all the NCLT companies and specially Bhusan Steel…Will all these companies value zero…
@adityaagarwal There are plenty of companies with secular stories most of them in consumption basket. Names that come immediately to mind are HUL, ITC, Colgate, Dabur, Pidilite, Asian paints, Page Inds, electrical appliances companies, and besides these some top private sector banks where NPA concern are negligible e.g HDFC Bank, top notch consumer lenders like Bajaj Finance etc. There would be many more besides these but these were the ones that came to mind immediately.
Most of these would have a couple of lean quarters but then make up over subsequent quarters. Trick is to harness the courage to buy some of these when they do report poor quarterly numbers in succession. Because thats exactly when the street is maximally bearish and stock price is punished beyond reality and becomes really attractive.
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@anurag88 The value of the company in question will depend upon the haircut the banks are ready to take. But betting on these kind of scenarios is damaging in two aspects
First is you dont know the outcome.
Second is even if you are very confident you will never have the courage to bet a significant amount of portfolio to make a meaningful difference to the portfolio returns.
If one gets the call right, it provides bragging rights over twitter and facebook and social media.
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sir, any views on PCJEWELLER, it had a big fall, the numbers in the balance sheet were good, a wrong controversy with Vakrangee, a wrong controversy with Nirav Modi & PNB, now news is that the promoter has gifted some shares to his family members. Stock is completely beaten down and looks like a pump and dump instrument for operators, they recently hired Akshay Kumar and Twinkle Khanna for their ads, i see lot of advertisements in tv and newspapers, do you see a ray of hope in this company?
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Hitesh sir…may i request for your views on paper industry…im planning long term bets on JK paper…i think they have good cash flows since last few years and operating in a niche segment…
Regards
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Is it a good Stratergy to short options on expiry date?
Dear @hitesh2710 sir, You mentioned in your earlier posts that you usually will be 100% invested. I struggle to hold on to cash position and most of the time 100% invested. Hence, I would like to know when a new opportunity presents itself, what are the decision making points or considerations you do what to exit for generating money for new positions? Do you typically exit a position completely or do you trim multiple positions to generate the funds? This is an area I am trying to learn and answers on how you do it would be a great learning for people like us.
Thank you,
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dear @hitesh2710 , 
sir, this is shree digvijay cement quarterly financial result. will you throw some more light on it. If you tracking the same ?? thanks.
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@sameer_patel18in i dont have much idea about digvijay cement or its prospects. Only numbers wont suffice in case of investments. Markets usually pay for future growth and what we have seen from you are past numbers. If one can predict something from the data you have put up, then it could be interesting.
@shyamutty The quality of celebrities endorsing a company’s products should not be criteria for assessing a company’s strengths as an investment candidate. If I recall correctly, Shah Rukh Khan used to endorse Gitanjali Gems products and some prominent heroines used to endorse their brands too. Looking at the kind of fall in PCJ, I think the issues might be deep rooted than we think. This however is only a personal opinion and not an informed opinion.
@sumit680 I dont track paper stocks too closely. Most of them though seem very strong on charts and there might be some sort of tailwinds for the industry.
@getsach There are better options to lose money in the market than selling options on expiry or on any other day.
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While evaluating a new position in the portfolio the first consideration I have is of a potential downside from where I am buying. Plus if the new option offers significant upside potential then I would consider adding it to the PF.
Coming to where to raise funds for the new candidate in the PF, it all boils down to weighing the stocks in your portfolio and see which stocks merit a cut or a complete exit.
Earlier I used to have a policy of complete exits to make way for new stocks in PF but of late I have resorted to the policy of reducing stakes in the least attractive/lowest conviction stocks in the PF. Say if there were 10 stocks in PF then the last ranked 3-4 would take a cut of 25-30% of total holding to make way for the new stock.
Most of the times I have a portfolio comprising of 60-70% long term stocks and 30-40% opportunistic techno funda kind of bets. The success rate in techno funda bets usually doesnt exceed 70-75% in the best of times. So the rest of the 25-30% of the short term/opportunistic bets which dont work out after a period of time allows for some headroom in terms of raising funds for the new incumbent. Plus some successful bets reach the desired targets allowing further raising of funds to make way for the incumbent.
I think the best way to tackle this issue of portfolio construction is to have a dynamic approach and keep learning along the way and then find out which strategy suits the most to us as an individual. Different people with different mindsets will be comfortable with different strategies. Its no use trying to copy someone totally. But discussing things like you and me are doing would often help in providing a way ahead.
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Hi Hitesh, what’s your view and experience in terms of catching a falling knife like PC Jewellers. It is available at mouth watering levels after the recent fall and unlike Vakrangee the stores are real and easily identifiable. Also with a Facebook likes of 20lakhs much more than Tanishq, it does seem to have some happy customers vouching for them.
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Thank you for a detailed answer. Evolved system of decision making of senior investors in terms of exit strategies helps newer generation to formulate their own systems and strategies. Much appreciated !
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Hitesh bhai, I would like to know your opinion on shipping sector. It is down to dump-yard since 2008 i. e. almost 10 years and barring market leader (GES) most of the players are struggling very badly. Though I am not much aware of the periodicity of shipping cycle and not even confirmed about the regularity somehow I feel we are very near to the bottom and need to start taking look at good companies in the sector. Your precious view on this will be highly useful for all readers !
@SlownSteady Catching falling knives is a dangerous business most of the times. It works only when you have done a lot of homework and are very confident of bearing short term pain of seeing stock price plummet a lot even after you have bought after a precipitous fall.
I dont have much idea about what has led to the fall in PCJ stock price but have managed to stay away from catching falling knives.
The kind of stress and anxiety associated with holding these companies takes away all the joys from those few successful falling knife catching ventures. In my view there are much easier ways to make money in the field of investing.
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Dear Hitesh, Can you share your views on Canfin Homes & HDFC LIFE at current valuations?
@Ramesh_Patel I dont track or have much idea about shipping cycle.
@newone I have stopped tracking hdfc and canfin and most other HFCs, so not much idea about their valuations.
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Thanks Hitesh. How about HDFC LIFE Insurance?
HDFC Life because of its parentage remains one of the best bets in the insurance space. Valuation would be a call everyone will have to take on his/her own.
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Hi @hitesh2710 bhai, I have a query . How Market/we should value NBFCs ?Is it on P/B basis or P/E basis ?For example Bajaj Fin is growing at 20% ROE and EPS growth with 35% CAGR . Now if we consider P/B basis , then Bajaj Fin stock price will grow 20% CAGR(considering P/B will stagnant) but if we consider P/E basis stock price will grow 35% CAGR(Considering P/E will stagnant). What is the right framework to calculate future price of a NBFC?
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