I have recently started investing (around 6-7 months back) and I invest on a monthly basis around 25-35k, depending on the opportunities available. Thought of sharing my portfolio with the stalwarts here, the ideas are a mix of valuepickr, self research and other ideas floating around web.
Company
Avg Cost Price
Current allocation
Aarti Drugs
205.8
13.88%
Ajanta Pharma
375.2
3.36%
Control Print
76.5
3.64%
Empire Industries
710
3.19%
Gillanders
79.8
9.08%
Godawari Power
122
2.86%
Granules
181.1
5.31%
Greenply
399.6
4.91%
ITC
248.6
3.56%
JBF Indus
125
2.57%
Kaveri
942
4.64%
MUTHOOT CAP
92.5
4.11%
Opto Circuits
123.2
2.30%
P I Industries
540.4
9.27%
Sukhjit Starch
245
3.19%
Titan Industries
234.8
9.99%
Unichem
197.8
14.14%
Would request seniors and other members to give their view on the portfolio above and provide their insights. Idon'thave any major liquidity requirements for next 3-4 years atleast (this makes me take a bit long term view on stocks) At the same time , would really appreciate ifseniorsout here can suggest some stocks which they feel are v good long term prospects.
Aarti drugs: It may sound very naive, but my main reason for such conviction in aarti drugs is the regular buying by promoter group in last few quarters. If you look at the disclosures, there has frequent buying in last few months specially. On top of it the company is delivering as well. See the trend in net profit, sales for yourself…regular dividend payment in last 7-8 years. The same holds true for Aarti Industries, one of the other group companies, same signs of promoter buying and good improvement in results in last 4-5 quarters. It may be possible that the promoters/management have turned bullish/aggressiverecently and want to capitalise on their experience and technical know, etc. Currently Aarti industries conducts con call, analyst meet, etc, the same is not there for Aarti drugs, I believe once they also start providing management access and be more open to investors the confidence should increase further in the business.
Control print- its basically into marking and coding business, if you look at the website you can see what service it actually provides (http://www.controlprint.com/solutions.html). I believe going forward there is huge scope for the company, everything we buy (specially eatables & medicines) there has got to be some coding and marking and stuff. With more stringent regulatory requirements day by day, I believe the business should do well. Also, not sure if there are any more established players currently in India in this business. Having said that, Idon’tbelieve there is any pricing power for such companies.
Hitesh-
Thanks for your inputs, regarding opto- I plan to book loss and exit…but somehow I stop myself each time. The management is good and past record I believe proves that. Just some temporary trouble I believe. On another note, even poly medicure is in somewhat same business segment, is it a buy at these levels? (the price multiples looks pricey) I read in other threads as the company having good prospects.
Recently deployed more funds during last week and exited positions in opto, JBF and other non performers in early Feb which saved me from further losses. Lesson learnt is that - never invest in companies which you don't understand, some (perceived!!) undervalued stocks may remain undervalued for a long long time (have even read it at so many places in investing books and memos)
I present my updated portfolio below--
Company
Name
Current Allocation
Aarti Drugs Ltd.
11.55%
Aarti Industries Ltd.
2.78%
Cera Sanitaryware Ltd.
6.00%
Control Print Ltd
2.30%
Development Credit Bank Limited
6.63%
Empire Industries Limited
2.42%
Granules India Ltd.
5.30%
Greenply
6.80%
ICICI Bank Limited
5.03%
ITC Limited
2.87%
Kaveri Seed Company Limited
3.56%
MUTHOOT CAP
3.00%
Orbit Exports Limited.
3.30%
P I Industries Ltd
7.47%
PTC India Financial Services Ltd
6.62%
Sukhjit Starch And Chemicals Ltd
1.98%
Titan Industries Limited
7.37%
Unichem Laboratories Limited
15.03%
Recent additions include ICICI bank, PTC, aarti industries to name a few..bought all these on budget day in last 30 mins of trading hours.
As usual, would request the seniors here to comment on the portfolio. (Hitesh has always been generous to comment and share his views, thank you Hitesh!!)
I think the recent correction offers a chance to wash off the past sins.
Among the financials, I think it would make sense to go for a better solid name like hdfc bank or indusind or yes bank (or all three) instead of dcb, ptc ind financials and other financials in portfolio.
aarti drugs and inds both seem good growth propects but I dont like the idea about them paying out liberial dividends instead of focussing on debt reduction. Distributing dividends involves paying unnecessary tax to govt while debt reduction works better for the company.
control print seems okay but I saw pledging of around 22% of promoter stake in quarterly results and that turned me off. Pledging has become a curse in current market conditions.
Another lesson to be learnt is to cut losses at the earliest to avoid further losses.
Thanks Hitesh and Vivek for your comments and views.
I personally feel, the valuations of HDFC bank and Yes bank are very steep (they provide quality as well, no doubts on that) will look again at the financials you mentioned.
Regrading Vivek’s observation- I invest on a monthly basis and hold cash if I feel there are no good opportunities around. One cant foresee if markets will rise/fall in short term. And Idon’tthink the current market and be termed as bull markets. So if the horizon is long enough, SIP is the best way to go in current market environment as well.
I am the process building myportfoliofor the long term (more than 5 yrs) and have started very recently. Lots to learn from seniors out here.
My learning in last few months- Its best to always buy a company who deals/sells DIRECTLY to consumer and sells the final products. And who can increase the price comfortably.Even Buffett has suggested similar stuff.
Reproducing my portfolio below -
Company
Current allocation
Kaveri Seed Company Limited
28%
Unichem Laboratories Limited
15%
Cera Sanitaryware Ltd.
10%
Wockhardt Limited
7%
Emami Limited
6%
Yes Bank Limited
5%
P I Industries Ltd
5%
Granules India Ltd.
5%
ITC Limited
4%
IndusInd Bank Limited
4%
Navneet Publications (India) Limited
2%
HSIL Ltd
2%
Titan Industries Limited
2%
Marksans Pharma Limited
1%
Sukhjit Starch And Chemicals Ltd
1%
Control Print Ltd
1%
Some updates:
Loaded up with Kaveri on results announcement day by selling other stocks in portfolio wherein I thought upside potential was limited.
Recent new stock additions include -
HSIL (trading at very low valuations (compared to last 2-3 yrs) & as per con call the second half of this financial year should be very encouraging with expansion in margins and full capacity utilizations, stock offers decent dividend yield as well)
Navneet Publications (borrowed conviction here, but the current financial year should be very good with new course structure introduced in Maharashtra & Gujarat, stock trades at decent valuations+dividend yield is also fine)
Marksans Pharma - this is a turnaround play, took a starter position here. Last 3 quarter results of company are right on track. This one is quiet a risky bet though.
Wockhardt- Got in it at a bad time, so its in deep loss currently. But I believe at CMP the stock is a good bet. Once the US FDA issue gets resolved (in next 12-15 months max) the stock should be up and running again.
Plan to increase my allocation towards Yes Bank - after digging into it more, realised it has tremendous potential for PE expansion/re-rating and earnings growth of 20-30% y-o-y for next 2-3 years atleast. (possibly a mini HDFC bank)
ITC remains one of my preferred picks (am in love with this scrip), will SIP it whenever the price shows some correction.
In consumer space Emami also seems to be a good bet, as per their con call, they talked of volume growth of upwards of 10-15%, this I feel is very encouraging. With price increase, this would result in increase of c30% increase in topline. Also, as per my observations, Emami has very strong position in north-east. Products are well accepted there. It being a Kolkata based company, the company does tend to manage things well (comparatively) in north eastern states. And they are expanding there as well.
Reduced Titan, as per con call the management sounded bit bearish. Also the valuations seems too rich.
Plan to add few growth stocks like Astral, Pidilite, Kajaria, Supreme industries. However, it becomes difficult to add because of price anchoring as have seen these stocks from much lower levels (and never added them before!!) Any advise on how to get rid of this bias would be more than welcome.
Any observations, comments from fellow investors would be more than welcome.
Today, I completed exactly 1 year in investing. Just did some return calculations (XIRR) in excel and found that my portfolio delivered returns of c28%. Felt happy.
Best way to add these growth stocks is don’t time the price…just go and intiate someposition with small amount. Whatever price you purchased first will become your refrence price and you can play around that price (if down add on and if up feel happy:)). Otherwise you will keep on saying “have seen these stocks from much lower levels”:).
Plan to add few growth stocks like Astral, Pidilite, Kajaria, Supreme industries. However, it becomes difficult to add because of price anchoring as have seen these stocks from much lower levels (and never added them before!!) Any advise on how to get rid of this bias would be more than welcome.
@Subash- I sold aarti drugs cz I found Kaveri more rewarding (its basically a comparative analysis between aarti drugs & Kaveri) and till now it has proved correct as aarti is down few % whereas Kaveri is up by 25% after the result announcement. However, I do plan to buy Aarti again. I don’t see any trigger in aarti drugs till the annual report comes out or Q1 2013 results. And normally in such cases the stock does see a correction in between. (there is no corporate access/presentation/con call for aarti drugs to the best of my knowledge)
Regarding promoter group buying in this counter- they have been buying v v aggressively since last 4-5 months. Its a positive no doubt, but now am just getting a feel that the buying may be cz of dividends (aarti drugs pay liberal dividends) also, it can be a case of not so informed buying. Markets are mostly right to assign value to a company. Even the promoter group may fail to gauge the true prospects of a company. Seniors here can throw more light in this regard.
@Om-BoughtAstral & Alembic pharmain small quantity in today’s market correction.Took initial position in Sun Pharma (as per Morgan Stanley’sinteractionwith the company, the prospects are really strong). I give moreweightagetocompanyguidance/takeaways from meeting rather than research reports/target prices by broker reports.
Reproducing my updated portfolio below, suggestions would be welcome.
Kaveri
31%
Yes
Bank
11%
Alembic
10%
Emami
10%
Cera
7%
Indusind
6%
ITC
6%
Navneet
5%
Granules
5%
P
I Industries
3%
IIFL
3%
Lovable
3%
In the recent fall in BFSI space and overall correction in markets, I have been adding Yes bank & Indusind bank. Plan to add Indusind more if it remains in this range till I receive my next salary. :)
Made some trading gains in Marksans pharma, now out of it.
Sold HSIL after very sad Q1 numbers.
Sold Unichem as well, to invest the proceeds in Yes/Indusind. Though I plan to buy Unichem again.
Sold wockhardt around 900-1000 levels (after problems crept from European regulatory body, decided to sell it immediately as it was too much for me to bear), booked losses in it. And now it seems I still managed to get out in time. There seems to be no relief in this counter (stock still hitting LCs)
Sold other non performers/less conviction ideas.
New additions include - Lovable Lingerie (Q1 results are very encouraging). I plan to add CERA more (promoter again buying at these levels, which gives confidence to buy) One thing I have noticed that, CERA has stood very firm in this crash. And even during the crash seen in first quarter of this year, CERA was comparatively very firm. While other mid/small caps fell like anything.
Thanks to all the seniors here & special mention for Hitesh for his timely guidance & suggestions.
Regarding CERA request you to refer the respective thread to know why its a great stock to own, I bought it for the same reasons. Valuation/financial parameters wise also I feel the stock is great. High ROEs, manageable debt and good growth trajectory, frequent promoter buying (this gives additional comfort to add around similar levels of promoter buying price)..all these makes CERA a great stock to own for coming 3-4 years atleast..I feel..
I have exited navneet publications, it was a borrowed conviction- a short term play on Q1 2013 results..but Q1 results were not upto the mark. Exited with some loss after the results. Though I feel valuation wise the stock is not at all expensive and given the sector in which it operates (recession proof). Its also a good long term bet. This stock is also discussed extensively on respective thread. You can go through it for more details.
Lovable - Its a kind of contra bet (I say contra cz most ppl on the street dont consider Lovable a worthy bet as the revenues have not been increasing with the pace as it should, given the sector in which it operates)..have reduced my holding a bit in this case (you can attribute this to low conviction/other high conviction ideas with more visible triggers) would surely add up if it goes below 250. Valuation wise its surely not expensive and the numbers are also decent enough. The company have re-organised its distribution network and the benefits would be (hopefully!) seen in coming quarters. Simple rational in investing being- Page industries has not been able to replicate its magic in the female segment. While lovable has a strong footing in this female segment. Though comparison with page is not correct because of the brand power and pricing Page enjoys. Still I feel in coming times Lovable would do great due to the advantage it has in female segment. The penetration in this segment is far less and therefore scope is also high.
On a different note- I feel that BRANDS(or some very niche product) are and would be the way forward. People would be more and more brand conscious and there would be very very limited place for 3rd grade/Local brands. And this goes for all the products..anything we eat, drink, wear, use. In terms of stock market investing - it means we should latch on to those companies who have a good enough brand in the respective category it operates coupled with good management and good financial performance. Example being - CERA, ITC, Pidilite, Asian paints, Britannia, Godrej, Emami. Even companies like HUL, Nestle..though very high valuations..but good long term bets I feel..
This is how my current portfolio looks
25%
Kaveri
14%
P I Industries
12%
Alembic
11%
Yes Bank
10%
Emami
7%
ITC
7%
Indusind
7%
Cera
Rest in Granules, IIFL, Pidilite, Lovable & Poly medicure.
The change in % allocation is mainly due to fresh allocation of capital in almost all the stocks in similar weights except for Kaveri. Bought Yes & Indusind in more qty in the recent fall and same for CERA when it came below 490 odd. Added PI industries as well in more qty.
Any comments/suggestions from fellow investors would be very much appreciated.
I think you should sell Granules, IIFL, Lovable and replace it with Page at todays prices (3900). Your reasoning for buying Lovable is not correct and contrary to what you are saying page is increasing its foothold in womens ware. They recently opened Jockey Womens in Mumbai and are very much aware about the growth in this segment. Lovable will still get a pie but page is aiming for a bigger pie.
Thanks for your suggestion and view. As you can see the allocation to Granules, IIFL & Lovable is already small. But I feel these 3 should do good enough.
The result of granules in last 2 quarters has been great and the company expects to clock 25-30% CAGR in revenues with increase in margins.
IIFL - This is one stock which is feel is completely misunderstood. The company is practically a NBFC and the profits from broking business is very very less. I even started a discussion in one thread but it got no response sadly.
Reproducing my updated portfolio below, any comments/suggestions would be welcome
21%
P I Industries
17%
Alembic
16%
Kaveri
12%
Yes Bank
7%
Emami
6%
Cera
6%
ITC
5%
Indusind
5%
Polymed
Rest in Aurobindo, Pidilite, Acrysil, Dhanuka & Wockhardt.
Recent additions include the low weight stocks - Dhanuka, Acrysil & Wockhardt.
Wockhardt - Bought it very recently, seems the stock has been beaten badly down and now it seems to have gained some base. If I look at it in terms of market cap, its around 5000cr, which seems very decent for such a company which would earn close to 700-800cr net income for FY 2014. Recently the promoter group has been buying again and it seems they would take the shareholding to max cap of 75% (now its around 74.4% after recent purchase)
Acrysil - Seems the stock could be very good wealth creator in coming years. At 55cr market cap, the opportunity is huge. Management aims to reach revenue of 1000cr by 2020, even if they achieve 500-600cr, it would be great.
Aurobindo - The company seems to be back on track, only problem seem to be high debt (which the company is reducing slowly) As per concall & annual reports, etc the pipeline seems very strong, also with Unit IV functioning again it would add further to co's revenue & profits.
I keep on adding the existing stocks in portfolio as and when there is free cash and some weakness in price.
