Suryaji,
I just read all of your comments in vp, and I must confess, I am thoroughly impressed with your thinking approach. I enjoy the way you see the market. Seems logical/mature to me.
I guess, I need to develop the above approach inside me to be a better investor. Keep guiding 
Also, please introduce yourself in valuepickr introduction thread.
Regards,
-Subash
Very nice thought process Surya but the difference of 30% and 60% is doubling money in 1 year 1yr and a quarter and 2 and a half years. Conviction level again is a unmeasured parameter which cannot be baselined.
Regards
Supratik
Thanks Subash.
You will develop the approach. It is very simple. Simpler than it looks.
Hi supratik,
I tried to collect my thoughts on âConvictionâ. Conviction is actually a metaphor. I can say like this High Conviction is a possibility which has highest probability. And moreover you need to know on what you need conviction. Do you need conviction on the price you are paying, or on the market size, or on the management quality etc. If you are an investor like me then the first thing you need conviction is on Market size. Because scalability is what I look for mostly. If they say 60000 cr drug retailing Market what is important is you need to know whether it is really big or not. There is no need to validate on 60000 cr number.
You can list out on what you need to have conviction and then take it from there. **The main thing is you need to have a broader picture first and then financials may help in making reasonable judgements. **
I would recommend a book here. âInnumeracyâ by John Allen Paulos for a treat on making âreasonable judgementsâ.
Hi Subashji,
Around one and half month back you told me to hold Astral & Cera,You also told me âthere is no reason selling a 30-35% compounder because of illusion of high valuation (if you consider next qtr result, trailing pe is 24, which I think is fairly valued for 30%+ compounder).â
Then you were absolutely right,Astral Poly,the stock has had a great rally again from the 380 levels to 500 since then & Cera,this stock also has had massive rally again from 750 to 900 doesnât seems stopping,My query is Astral & Cera,this two stocks,isnât it bit expensive? Or should we view this as re-rating after Q4 result,Beside this we know that Astral & Cera is an excellent business,what do you sayâŚ& are you still happy to hold this businesses?
Hi Subhajitji,
Quality things are almost always expensive.
Besides, if you have read a post of Bakshi, where he mention how investing Nestle at its peak valuation, still gives decent return in long run. So, the lesson for me from the above article is to just invest in quality/branded/consumption themed play at right price, and do nothing. Doing nothing is an excellent, but under appreciated strategy. People have forgotten this lesson in Page, and have gotten out of it, and hence could not reap the full compounding benefit.
Just enjoy the ride in eps/price/brand/business for next 5-10 yrs is the strategy for me when come to astral/cera. I have no plan to sell them unless they become extremely over-valued (and feel better return expectation in non-equity side like real estate in next 4-5 yr), and I see they are far far away from the extreme over-valuation range.
[Disc: Astral/Cera are 25% of my pf]
Regards,
-Subash
Hi Subashji,
Around one and half month back you told me to hold Astral & Cera,You also told me âthere is no reason selling a 30-35% compounder because of illusion of high valuation (if you consider next qtr result, trailing pe is 24, which I think is fairly valued for 30%+ compounder).â
Then you were absolutely right,Astral Poly,the stock has had a great rally again from the 380 levels to 500 since then & Cera,this stock also has had massive rally again from 750 to 900 doesnât seems stopping,My query is Astral & Cera,this two stocks,isnât it bit expensive? Or should we view this as re-rating after Q4 result,Beside this we know that Astral & Cera is an excellent business,what do you sayâŚ& are you still happy to hold this businesses?
Subashji,Thanks for your reply.this is quite a lesson for meâŚ
Regard,
Subhajit
My Latest PF (31st Mar 2014)
| Stock | Weight |
| Alembic Pharma (16) | 21 |
| Astral Poly Tec (13) | 15 |
| Shilpa (10) | 14 |
| Cera Sanitary (11) | 9 |
| Ajanta Pharma (6) | 9 |
| Aurobindo Pharm (3) | 7 |
| Poly Medicure (9) | 7 |
| Mayur Uniquoter | 6 |
| Avanti Feeds (3) | 5 |
| Selan Explore (2) | 4 |
| Orient Refract | 2 |
| HCL Info | 1 |
Looks cool PF!
Pharma is dominant though,you may like to balance it.
Hi Subhash,
Any reason for exiting repco and pi industries? What is your take on entering hcl info?
@Manish - Various Pharma related stocks that I have have different (and uncorrelated) business characteristics, and hence I donât feel it make sense to club them into a single group.
Ajanta is mostly emerging market play (not effected by stringent USFDA), Aurobindo is turnaround US ANDA play (can get adversly effected by USFDA rulling), Shilpa is predominantly an Onco API play, which is getting positively impacted by stringent USFDA (as other players are increasingly dependent on its API). Alembic is an excellent growth story, with increasing portion of US/Export in sales.
@Rajat - I needed money for paying part of my home loan installment, and hence sold repco/pi in that process.
Hi Subhash,
Would like to know your rationale in buying HCL info . 1% allocation reflects that you have not build your conviction on this one yet.
Apart from promoters buying and the pedigree what more prompted you to enter/explore this?
Dirt cheap valuation, promoter buying from open market, transition to hardware solution business to an asset light model, Mcap == cash.
I have taken an initial starter position in hcl info. Planning to increase stake in SIP manner. It has been the case for almost all of my buying (I buy small chunks of stocks I like in SIP basis most of the time)
Regards,
-Subash
Can you please explain more about transition to hardware solution business to an asset light model? I didnât understand this part⌠I want to know what is the change in business strategy that will bring growthâŚ
Hi Subash,
can you pls explain the rationale for Orient refractories? what are the possible triggers?
valuations doesnât seem to be cheap with PE at 14.
Selan was 15% of your portfolio (as seen in one of your comments) but now its 4%, any reason why you are getting out of it?
@Equity/@Sridhar,
I dont do much research for 1-2% stake stocks in my pf :).
As of Orient Refractory, there is a thread in vp for the same: http://www.valuepickr.com/forum/special-situations/601274632
As of HCL Infosystem is concerned, this should help you : http://www.hclinfosystems.in/sites/default/files/reportpdf/Investors_Webcast_Q2%20FY14_v9.pdf
I need to sell decent amount of stocks for paying installment of my home. So I sold Selan at a decent profit.
Hello Subashji,
Hope are doing well.We have not see your portfolio for many days.Kindly post your portfolio.Thanks
Regards,
Subhajit
I believe you featured in Slide 3 of below link.Congrats!!
Thanks Ashish,
There is one typo in it. It is âsince 2011â in place of âsince 2014â 
Regards,
-Subash
