ValuePickr Public Portfolio


(Administrator) #21

Dear Kishor,

1). Long Term portfolio picks are made after much deliberation, usually post a Management Q&A.Conviction in these stocks are high, as is undervaluation at point of recco.And are recommended for a hold period of min 2-5 years. Updates every 6 months - Short-term developments are unlikely to change views drastically and we do not believe frequent updates will do more good, nor do most of us have the bandwidth. Readers are free to add on declines below recommended entry point. We may start providing new entry points - every 6 months - based on the outlook/conservative projections for next 2-3 years.

Besides, if we keep revising entry/exit points - where is the ACCOUNTABILITY that we want to build in? We must give a stock a reasonable run, and give enough time for our conviction to play out; Also ValuePickr aims to remain a concentrated portfolio and generate the most from the 18-35% CAGR objective.

2). Opportunistic Portfolio - Expectations of a 50% upside or more in 6-9 months or less than a year. Sheer undervaluation Opportunistic bets. Again we have to be very choosy and not too many stocks will pass muster. These also are extensively pursued - sometimes a s diligently as the Long Term portfolio candidates including Management Q&A, and we see no reason to update frequently. Maybe as we evolve and mature, this might need a Quarterly update.

Hope you will understand the objectives and also our limitations.


(kishor barhate) #22

Dear Admin, Got it right now a perspective as explained by you… My only concern was how do one know any new entry of stock in long/short term portfolio as soon as it is added in portfolio. Entry/exit mentioned by me was not wrt price it was wrt to new stock added OR removed from portfolio… Like Technofab have made entry to short term portfolio on 04-05-2012 by Shri donald. Which will reflect in list only after 6 months. I was just wondering if there is any way to find in consolidated view whenever any stock is added OR removed form portfolio long OR short… But your logic wrt objective is quite okey… Many thanks for your reply


(Balaji Ramalingam) #23

Dear Admin,

Which of these two companies VST Tillers Vs Swaraj Engines has better business prospects ? What’s the best prices to have them in one’s portfolio ? Considering their CAGR, I believe they both qualify as good investment companies.

Please share your views on this.

Thanks

Balaji


(Administrator) #24

Dear Kishor,

Thanks, we see your point.

From here on, whenever a stock makes an entry into the long term or short-term portfolio, we will announce it here in this ValuePickr scorecard thread - with links to the relevant discussion thread.

This will be useful for everyone - especially the non-regular/casual visitors, and fresh visitors.

Thanks


(Administrator) #25

TechnoFab Engineering makes an entry into the Short Term Portfolio, after due deliberation for a month.

Idea initiated by Atul Sethia on April 07. Recco for inclusion in Short Term Portfolio made on May 04.

We are hopeful of a Management Q&A meet in June 1st/2nd week


(kishor barhate) #26

dear admin…many many thanks for your consideration. It will sure help to lot many persons as mentioned by you


(hemant gupta) #27

hello,

i am new to this forum. just finished going through all the threads. what an amazing wealth of knowledge and ideas! the valuepickr scorecard looks great. i was wondering what % allocation was recommended with these picks. there is a separate thread for capital allocation discussion but i couldn’t find any recommendations for allocation on the long and short term portfolio. am i missing something here?

thanks,

hemant


(Administrator) #28

Dear Hemant

Glad you find ValuePickr useful. Welcome your active participation - which is what makes ValuePickr what it is today!

Capital allocation is a vast subject, and depends on an individuals risk profile, his own financial standing, and a lot of other factors. As we mature, we may be able to come out with recommendations for a Aggressive Portfolio, MOderate Portfolio and a Conservative Portfolio.

Some members do reveal their own portfolio mix, look out for that as clues. You can also reach out to individual members for more.


(PATURI BAPAIAH CHOUDARY) #29

Sir,

It is quite useful for the new comers when and at what price the stock was discussed and present price et., good job and keep updating the same every month or FN in aseparatethread

Thanks with regards,

paturi


(Administrator) #30

Dear Paturi,

Thanks for your comments. Please participate more in the forums and invite fellow investors.

Rgds


(Raja Janakiraman) #31

Saw some news on Balkrishna - Chrys Capital is looking to exit its 9.5% stake. Thought this might help those tracking/invested in the stock as I see it’s on top of the scorecard.


(PATURI BAPAIAH CHOUDARY) #32

Administrators,

Please update the Score card at least every quarter which is quite helpful to new visitors.

regards,

PATURI


(Raja Janakiraman) #33

Hi guys, some feedback/thoughts after using the relevant tools.

Stock Screener:

I notice that the valuation metrics (eg 13.04 P/E for Balkrishna) on the company snapshot tool are trailing by a huge lag - the multiples are for FY09.

While the stock stories and current earnings trends are being discussed in the stock thread, the snapshot tool is often a first start for someone unfamiliar with the story, after going through the scorecard )- especially to gauge current valuations and work out entry levels.

Is there anyway this can be more robust, at least for stocks on the scorecard ? If it requires help from members, I am happy to volunteer.

Scorecard:

  1. Instead of updating a scorecard table in a post, we could maintain a googledocs spreadsheet (privacy locked of course). This helps in keeping all info in one sheet as opposed to reading multiple posts to understand what has changed (say an earnings upgrade due to strong H1 performance).

I presume the info is being pasted from a spreadsheet someone maintains.

  1. An investment note (not more than 2 pages including charts) is often easiest to read to get a summary of the value drivers; I’ve attached a sample of a note I prepared a while back.

An idea making it to the screener could have such an attachment after all the due diligence/channel checks are done ie. at the stage it makes it to the scorecard with a buy recommendation. Some threads (like Mayur) span 6 pages starting 2010 and can be hard for someone new to the stock to grasp what’s going on.

I understand this could be cumbersome given the effort is collaborative but, the member proposing the idea could take the responsibility of doing this.

Let me know your thoughts. Cheers.

Samsonite-Investment-Note.docx (91.3 KB)


(PATURI BAPAIAH CHOUDARY) #34

It is good idea Raja sir to maintain a google spread sheet and do hope Administrators will look in this suggestion

reagrds,

PATURI


(Kuntal Sharma) #35

Teachers (because this is one of the best place to learn),

With the end of another quarter and the recent run-up of the indices, the updated score card would indeed look great.

Regards

Kuntal


(Rajesh Kumar) #36

Excellent performance. Commendable.


(Gigs) #37

Hi!

Could some one tell how do we access the scorecard?


(Administrator) #38

Recommendation Guidelines:

Buy, Add on declines: Valuations attractive. Visibility is strong. Better entry points may be available along with general market trends, and should be used for averaging down

Hold, Add on declines: Fully valued/rich valuations. Visibility remains strong. Better entry points may be available along with general market trends, and should be used for averaging down

Reduce/Exit: Valuations are fair/rich. But there are significant risks envisaged in near term. If Exposure is high, recommend reducing the exposure; If minimal one can even exit completely, as impact on portfolio on missing out, will only be marginal

Hold: Valuations still attractive. But risks on the Horizon. Significant additions may not be done till further update

Qualifying Comments: Long Term portfolio

1. All picks generally still okay for the long term investor as these are reputed companies with strong Managements with a track record of weathering many storms; Reduce/Exit options are from a Capital Allocation perspective, since there may be better opportunities among the Portfolio. Please refer individual stock discussion threads for specifics/details

2. Suprajit Engineering: Automotive slowdown reversal is going to take a few more quarters at the least. Meanwhile continued Capex/new plants in times of slow growth indicates tough times ahead. Turnaround in demand will be interesting for re-entry

3. Balkrishna Industries: Big change in demand situation, slowdown may take longer to revive; Increased Debt and Overcapacity situation entail higher risks and pressure on margins; Please note available capacity may work its magic very fast when demand revives. Interesting to track for re-entry

4. Gujarat Reclaim: Change in demand situation, slowdown may take longer to revive; Increased Debt, Overcapacity situation, changes in cost structure are pressurising margins; Please note available capacity may work its magic very fast when demand revives. Interesting to track for re-entry

Qualifying Comments: Opportunistic portfolio

1.Fundamentals generally okay; Reduce/Exit options are from a Capital Allocation perspective, since there may be better opportunities among the Portfolio

2. Manjushree Technopack: Company needs some consolidation time before New Capex utilisation kicks in and debt burden reduces

3. Oriental Carbon: No change in demand situation, may take longer to revive; Increased Debt and Overcapacity situation are overhangs; Please note available capacity may work its magic very fast when demand revives.

4. Technofab Engineering: Earnings growth faltering; Industrial/infrastructure activity slowdown recovery may take longer to revive


ValuePickr Scorecard 3: Dec 2012
ValuePickr Long-Term Portfolio Idea Initiation Reccomendation Lowest level Highest Level CMP Absolute Annualised Current View (at CMP) Qualifying Comments
Min 2-5 years Hold Timeframe Date Price Date Price since Recco since Recco 13-Dec-12 Returns Returns

Suprajit Engineering* 16-Mar-10 17.7 14-Jan-11 20.8 16.5 23 29 39.42% 21.50% Reduce/Exit See Above
Balkrishna Industries* 17-Mar-10 122.55 18-Aug-10 134.59 114.3 302 267 98.38% 43.72% Reduce/Exit See Above
Mayur Uniquoters* 18-Aug-10 118.5 10-Feb-11 120 113 480 467 289.17% 165.24% Hold; Add on declines
Gujarat Reclaim 18-Aug-10 1001 26-Aug-10 1007.2 911.9 2020 1525 51.41% 22.85% Reduce/Exit See Above
Ajanta Pharma* 17-Jan-11 90.3 17-Jan-11 90.3 86.5 418 395 337.31% 183.99% Buy; Add on declines
Astral Poly Technik 2-Mar-11 124.05 29-Mar-11 125 121 410 365 192.00% 115.20% Hold; Add on declines
PI Industries* 7-Mar-11 297 7-Mar-11 297 345 630 530 78.45% 47.07% Hold; Add on declines
Kaveri Seed Company 18-Jan-11 333 14-Aug-12 800 830 1340 1340 67.50% 202.50% Hold; Add on declines
Poly Medicure 6-Apr-11 261 20-Nov-12 400 172 439 410 2.50% 30.00% Buy; Add on declines
*Price adjusted for splits/bonus




ValuePickr Opportunistic Portfolio Idea Initiation Reccomendation Lowest level Highest Level CMP Absolute Annualised Current View Qualifying Comments
Min 6-9 months Hold Timeframe Date Price Date Price since Recco since Recco 13-Dec-12 Returns Returns

Manjushree Technopack 17-Mar-10 44.25 12-May-10 43.55 41.75 108 95 118.14% 47.26% Reduce See Above
Atul Auto* 19-Sep-11 64.67 10-Oct-11 65.33 57.33 162 173 164.80% 164.80% Hold; Add on declines
Indag Rubber 15-Nov-11 147 1-Dec-11 150 120 273 264 76.00% 82.91% Hold; Add on declines
Oriental Carbon 19-Aug-11 114 24-Oct-11 111 82 183 131 18.02% 18.02% Hold See Above
Technofab Engineering 7-Apr-12 143 4-May-12 130 113 162 126 -3.08%
Exit See Above
*Price adjusted for splits/bonus

(Atul Garg) #39

All the stocks in the score card are well researched here and reasons to have them in portfolio are well known.However why certain stocks are hold and some are buy is still not very clear.

When do we say a particular stock is fairly valued/richly valued. I know valuation is a relative thing and varies from person to person, but could not find some structured framework for valuation like we have for business quality and success/failure patterns ??

Just to add to this, I added some Mayur today. Rest in the Mayur thread :slight_smile:


(Donald Francis) #40

Hi Atul,

Some comments from my side. I will try to use ValuePickr Portfolio companies as examples. See if these help.

1). Balkrishna, Suprajit, Gujarat Reclaim - are all well-managed manufacturing companies. With strong, capable managements that have demonstrated great long term record. However these are what I would call Category B businesses. There iscyclicality in demand, some years are pretty good, some years are tough, margins do come under pressure. Overall things sort of even out decently achieving kind of 20-25% CAGR growth. But if you think about it, visibility is poor beyond the near-to-medium term.

Think about how Mr Market prices these kind of companies.

2). Then there are what I would call Category A businesses. These are much more predictable. Size of opportunity is big. Demand visibility remains strong, you don’t see a pattern of cyclicality and you CAN see them clocking higher growth rates for a number of years into the future. Mayur and Astral may fall into this category.

Think about how Mr Market prices these kind of businesses. Is there a discernible difference in business quality between these 2 categories?

3). Then there are Category A+ businesses. There is significant intellectual property involved. Once a certain size/profitability is reached and you have a decent track record established, usually these kind of companies go from strength to strength. Can you see an Ajanta Pharma or a Poly Medicure there. Perhaps a Kaveri Seed Company can reach there??

How does Mr Market usually price these kind of companies??

How are the odds of business performance stacked for these companies??If you can see that difference clearly - that shouldgive you some clues to differentiating among these businesses. And therefore buy, hold or sell clues too! if you can say whether Mr Market is NOW (12 months forward, 24 months forward) valuing them cheaply, fairly or richly - w.r.t. that future picture. That ofcourse is an ART form - the more stronger that picture for you, the more parallels you can cite from studying Mr Market’s preferences, the more businesses/stocks you get familiar with - the better will be that Feel.

Having said all that, you would also do very decently with a 25%+ CAGR from staying put in strong Category B businesses like the ones cited above. Nothing wrong with that.

But those that you CAN categorise into higher categories - are perhaps businesses where you think the ODDs are much better - for much stronger sustained performance. That’s a CALL you are taking!You may be wrong in that one or the other call. But Capital Allocation is all about becoming clearer and clearer about why you should allocate more capital to A than B.

We can only know by sticking our neck out - and taking that Call. We would not like to be ambivalent about all our portfolio stocks. Every 6 months we want to take that Capital Allocation Call - where should we allocate more of our Capital and Why - we look to learn from both our mistakes and our successes.

Senior ValuePickrs with a consistent track record are polled by Admin, against our Capital Allocation framework, before putting out the Reccos. There are different voices too, but someone does need to take a Call:)