I have been following stock markets closely for the past 9-10 months since I had a lot of free time during my second year at B-school. As I was intrigued by stock markets, I started to research more on companies so that after getting into a job I can do SIP in my portfolio. VP was a suggestion from my professor and I have been addicted to this forum for the past several months. It has been one of the greatest value addition to me personally and I owe a lot to the community for guiding me in the right direction. I wish I can repay the debt some day! I was lucky to have @basumallick visit my school for a guest lecture and going by his suggestion (which made perfect sense to me), I am planning to do a SIP wherein I will allocate 25% to the portfolio below, 25% in a multi-cap MF (according to my risk profile) and 50% into debt instruments (mostly RDs). If I am unable to beat MF returns I will increase weights to the MF part of my portfolio and make my personal portfolio more concentrated. And if I am able to beat MF returns I will assign more weight to my portfolio.
Since the joining date for my new job has been pushed because of obvious reasons, I started deploying some idle cash (from a LIC policy) as market crash provided a good opportunity to enter. I don’t wish to take out the invested amount anytime in the next 10 years and I will only revisit the stocks quarterly, unless there are any adverse changes to the company or management. My SIP will continue in the below portfolio for the next 10 years. My current portfolio is as below:
|8||Kotak Mahindra Bank||4.82%|
Watchlist – Caplin Point labs, Cupid ltd
ITC – Emerging non-cigarette FMCG player with zero debt and reduced focus on low ROCE hotels business. Excellent supply chain and a multitude of household brands in the portfolio. Hope is that the Cigarettes will continue contribute to the EBIT over the next few years and shield the FMCG from any drastic market impact. Most of the Capex in the FMCG business is complete and FMCG is ready to contribute to the operational profits. Very good dividend yields as per the new announcement.
RIL – Bet on telecom and fast-growing retail business. On track to reduce debt levels but refining margins might be impacted in the short term due to reduced oil prices. Have faith in management quality and hoping to see more market share in the telecom space. Contribution of retail and Telecom to EBIT is rising and increase in tariff will further solidify the business
SBI Cards – Was lucky to get a few lots during the IPO. However, in hindsight it looks like bad timing and don’t expect to turn black in the next couple of quarters. Only listed player in the cards space with a good handle of NIM and NPAs. Would be interesting to see how the story unfolds in the next couple of years. As per my understanding, the future looks bright but the stock should survive the next couple of quarters without being De-rated. Will reassess the weight for this particular stock after Q3 results
HDFC and Kotak Mahindra Bank – Couldn’t choose the better of the two as I personally like the management of both Mr Uday Kotak and Mr Aditya Puri. Broke FDs to invest in these two along with ITC during the recent fall. Top quality banks with diversified loan books and retail loan quality of both banks are simply the best in the industry
Manappuram Fin . – Asset based financing with a good margin of safety. With gold prices in uptrend, the overall book size is bound to increase. Also, because of job losses and economic slowdown, this is one company that will benefit. Low expense ratio and a decent dividend yield makes it an even more attractive investment
IDFC First – More of a bet on jockey than the company itself. This is one company, along with Bandhan, I have spent days researching and understanding the overall story. It has been disappointing that results every quarter are impacted by one issue or the other from the corporate book. Honestly feel that Dr. Lal handed over a shitty corporate loan book to VV. I am cautiously optimistic that there are no more skeletons in the cupboard and the bank is well poised to show incremental profits from the next quarter or so. I really buy VV’s retailization story but if the performance doesn’t improve by December quarter, I am ready to book losses.
Bandhan Bank – Another favourite stock of mine that went through a bloodbath in the last couple of weeks. I am sure the NPA scene will look bad but the bank is versatile enough to bounce back. Stock lost its track after Assam issue was overblown by media. But I strongly believe the MFI story is here to stay and Bandhan has already been a pioneer. Expecting Gruh integration and Promoter issues to be resolved without much of a hassle. Now that it is available at a comfortable level, looking to deploy more in the stock after quarterly results
Infosys – No introductions needed. Top notch management quality and one of the most ethical companies. Proven track record of innovation and has been consistently winning good number of projects. Not expecting the stock to grow at more than 10% CAGR but needed it to provide crucial diversification to my portfolio
Rites – Asset light consulting arm with regular order inflows from a government company and increasing number of turnkey projects may contribute more to the top line. Increasing number of export orders in the pipeline and good visibility of revenue for the next few quarters are additional valid rationale
Avanti feeds – Entered late in the stock but still I see good growth prospects especially in export market. Needless to say it will be affected by Corona but given the track record and zero debt levels, I am optimistic that company will grow at a decent click. It has been expanding organically over the past few years and has been a consistent compounder over the last few years. Recent diversification into shrimp processing is growing phenomenally well and I hope to see more contribution from this segment going forward.
Apart from these, I have a detailed document for each of these businesses.
I started to deploy my cash from March first week and as of today my portfolio is down 8.2% . Need inputs from seniors like @hitesh2710 @rajanprabu @Donald in the community. Other senior VP members too please feel free to point out your suggestions. TIA