Saji's portfolio


(Saji John) #21

An update on the portfolio. Trimmed (booked profit) in Symphony,Astral,Mayur,Kitex and Ajanta. Increased exposure to PIIndustries, Vinati organics, Shilpa, CCL and Capital First. Entered Cera(entry into premium segment after consolidating mid segment), Suven(more confident of pharma doing well) and CARE in the recent correction. Exited TV Today(borrowed conviction), Ashiana housing(lost patience waiting for RE recovery), Atul Auto(growth not happening) and Cyient(want to re-enter at lower price point). Highest allocation is for Avanti 11% and lowest is 3.5% for CARE,Suven and Mayur. I want to increase stake in Gruh and Mayur. Continuing to bet big on exports(pharma,chemicals,custom manufacturing,textiles,coffee and aquaculture).
New learning points 1) stock in the pf is better/safer than the elusive stock in the watch list. 2) able to chop past favorites(ashiana) 3) learning to ride the market with Avanti without profit booking 4) Started a new experiment of sticking with Kitex in spite of valid concern about foreign currency parking issue(only reason is the belief in Sabu as the Jockey)…time will unravel the truth.


(ignited minds) #22

As per my view - portfolio has almost all known names - you should buy some unknown names with good businesses & management


(Saji John) #23

Thanks ignited_minds for reviewing my portfolio. I know I don’t have any unknown names. That’s exactly what I want ie to concentrate on compounders. In my early days of investing I was looking for multibaggers all the time and I had numerous stocks and some did become multibaggers but unfortunately I had poor capital allocation. In the end I lost out. I don’t get much free time to monitor the stocks adequately. So sticking to stocks tracked by valuepickr’s gives me lot of peace. Even with the limited effort I am able to get 40% IRR when nifty returned negative last one year! One new entry to the pf is syngene international.


(Saji John) #24

An update on the portfolio

AJANTA PHARMA 12.1
KITEX GARMENTS 8.7
AVANTI FEEDS 8.3
PI INDUSTRIES 8
CYIENT LTD 6
CCL PRODUCTS 5.4
SYNGENE INTERNATIONAL 5.1
ATUL LTD. 5.1
CAPITAL FIRST 5
ORBIT EXPORTS 4.7
TORRENT PHARMA 4.5
GRUH FINANCE 4.1
MAYUR UNIQUOTERS 4
MPS LTD 3.9
CERA SANITARY 3.7
ASTRAL POLY 3.4
SYMPHONY LTD 2.1
Overall portfolio IRR appreciation of 49% when the market gave negative returns in 2015. Thanks a lot to God and VP forum, particularly to Hitesh and other seniors who have commented on my pf. I have exited suven(didn’t have the stomach to take the gyrations on every patent approval and I entered syngene), Vinati(as I entered little late and further growth is still far away) and CARE(amtek controversy). I have re-entered Cyient(I really like their market presentations and focus on niche segments) and Torrent(when it corrected). My mistake exiting TV today with moderate gains(calculation went wrong) Please give your suggestions especially in the context of 2017-19 themes. Thanks


(Irshad Farrukh) #25

Sajijohn

Good portfolio and nice allocation also. Should yield a nice return. What is your rational for investing in Syngene?

Regards
Irshad


(Saji John) #26

I wanted to replace Suven which I had invested for it’s research molecules. Right now Suven is like any other CRAMS play. I wanted to enter a pharma player with advantage of research. To quote a MOST report “Syngene, subsidiary of Biocon, is a contract
research organisations (CRO) with 2000+ scientists working for 16 of
the top -20 global innovators. Syngene offers integrated discovery and
development services to over 211 clients globally (103 in CY12) in
pharma, biotech, agrochemical and other industries. Long-standing
relationships with customers have been a key strength. Some of its
strategic collaborations are with Bristol - Myers Squibb, Baxter, Endo
Pharmaceuticals (pharma), and Abbott Nutrition.” Syngene is the only listed player in contract research in India. So it may command higher valuation multiples. I have a basket of pharma plays. Shilpa for onco, Ajanta for it’s expected growth in US, Torrent for it’s latin American and European business in addition to US. Ajanta and Torrent are strong domestic players also.


(sunnysachdeva) #27

congratulations @sajijohn


(Santosh Sinha) #28

Congrats @sajijohn, I like your stocks and approach, Wish you a even better return in 2016. Keep compounding at higher rate at higher bases. :joy:

Cheers


(Saji John) #29

Thanks @sinha124 @Irshad for reviewing the pf. I have been accumulating these compounders when ever funds are available. One challenge I have is to keep away the “attractive stocks with decent valuations” as I will have to sell some of the compounders. I keep telling myself what is there in the pf is better than what is outside. Sitting tight is definitely a challenge…


(Saji John) #30

It’s more than six months since the last
update on the portfolio. I have exited Cera, Astral poly and Symphony as I felt
the valuations are high even though they are very good businesses. Exited MPS
as I didn’t have the patience to wait for the next profitable buyout. Exited
Orbit exports as the results disappointed. Exited Mayur because of family
disputes. Switched from Cyient to Persistent systems as the valuation and risk
reward appeared to favor the later. Also I entered Sandesh as I wanted to be in
a Media stock to play out the radio/print media themes(earlier I had exited TV
today). Entered Oriental Carbon and HDFC bank during the last correction.
AVANTI FEEDS 10.8
AJANTA PHARMA 8.1
ORIENTAL CARBON 6.6
PI INDUSTRIES 6.4
PERSISTENT SYSTEMS 6.2.
CAPITAL FIRST 5.7
SANDESH LTD. 5.7
HDFC BANK 5.7
SHILPA MEDICARE 5.5
INDO COUNT 5.3
SYNGENE 5.3
CCL PRODUCTS 5.3
AMBIKA COTTON 5.1
ATUL LTD. 4.8
KITEX GARMENTS 4.8
TORRENT PHARMA 4.4
GRUH FINANCE 4.3
Make in India is the main theme I am banking on.
Hence maximum allocation to Pharma(24%) and textiles(15%). Next big allocation
is FMCG(16%). I firmly believe that compounders give the maximum return in the
long run. I am consciously avoiding Microfinance as It doesn’t fit in with the
compounding theme even though it could become the next mega theme. Kindly give your valuable opinions/criticisms


(Santosh Sinha) #31

Great going @sajijohn, I don’t find any NBFC in the list, which is a must in this mkt I guess :grinning:


(Gurjot) #32

Capital First and Gruh Finance - 10% of portfolio? :grinning:


(Vivek Gautam) #33

Saji

Whats your take on Torrent Pharma? The pipeline is very thin and India pharma industry is suffering the pangs of GOI price control orders. shud we convert it into some scrip with assured growth and profit?


(Saji John) #34

Vivek, Your concern for thin pipeline is definitely genuine. I am not an expert in this field. Nevertheless I do follow many Pharma companies since I practice medicine. From what I gather from different sources and from the actions of the management like buyout of API plant with all approvals and allocating significant amount for R&D says the management intent to bridge the gap of shortfall in their pipeline. Also funds from Abilify will help this cause. Regarding GOI price control management says " Expansion of NLEM list due to inclusion of more Fixed Dose Combinations (FDC) is expected to have negligible impact on domestic business. Domestic business is expected to benefit from amalgamation of Elder portfolio. Profitability from this segment is expected to improve due to enhanced productivity of field force" Also regarding the Brazil business he is saying “Revenues from Brazil benefited from price hike of 12.5% during the quarter, while improvement in field force productivity contributed to profitability from this segment. We expect volume growth to continue driving Brazil business in FY 2017”


(Saji John) #35

Yes, I have 10% allocation. With HDFC bank it is 15.7% allocation.


(Santosh Sinha) #36

I guess u have scope for one more NBFC with 10 % allocation, they are in a sweet spot at least for next 1,2 years IMHO


(Saji John) #37

Absolutely. I must work towards it. Thenks @sinha124 for reviewing my pf


(Sandip Thakrar) #38

Don’t you find Gruh Finance highly overvalued compared to most other housing finance companies to find place in portfolio ?


(Saji John) #39

You are right Dr Sandip, Gruh definitely has rich valuations. But it fits in well with the purpose of compounding. Roughly 20% kind of sales and PAT growth. Another more important reason is I find it very difficult to keep cash. So I park all surplus in HDFC bank or Gruh. Especially when there is downturn these two has the least volatility. HFC’s are in a sweet spot, so the opportunity is huge.


(Saji John) #40

An update on the portfolio is due as the market went through Brexit and US elections, it gave me an opportunity to shuffle the stocks. The main theme is to have as many compounders. Earlier I was focusing more on midcaps and small caps when the portfolio was small and took more risk. This time increased large caps to 36% for more stability in these volatile times. So I added Pidilite and Asian paints to play consumer centric themes and Sonata software for its dividend play. Added Nesco as it fits into my thinking of regular (rental) income and the management’s policy of low debt investment. Exited all the textile stocks, Kitex and Indocount for poor performance and Ambika with decent profit. I exited Atul ltd as it reached my target price. Also sold Torrent Pharma as it will take some more time for it to perform and I consolidated Ajanta, Syngene and Shilpa in the pharma space.

Disc: This is not an investment advice. I do this exercise to see my thought process over a period of time and commit myself to my main theme and be scrutinized by fellow boarders!!

Please give your valuable suggestions…