Caution Investor Portfolio Please Review

Q&A: Questions & Answers Portfolio Q&A
22

Sahiriaralam Sir, I have just started Investment and still learning. I started investing before current crisis. All the stocks I wanted to keep for long term. But suddenly coronavirus crisis shattered me. Seeing 30-40% loss in short time got me worried. Hence I thought let me pause for some time till things are clear say for 6 months. In the meantime I got good profit in HUL which I booked.

Right now, I have been reading Annual Reports of lot of companies to get conviction. I am following Cera Sanitaryware, GMM Pfaudler, Garware Technical Fibers, SRF etc apart from some FMCG companies.
Thank You.

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23

It’s human nature, I agree. It will affect someone even mroe if tehy have just started out. I agree no amount of bookish knowledge can ever replace experience. Which I also lack, as it’s been only 3 years in the market for me. But I try to make up for that by trying to learn as much as I can.

I don’t know if you like reading books or have read them already, but you could read:
Stocks to riches by Late Parag Parikh (it focuses on the behavioural part of investing)
Buffetology
Coffee can investing
The unusual billionaires
The education of a value investor (high emphasis on creating your own checklist)

Some thoughts about quarterly results: https://youtu.be/_TUTZ4ea42E

Some thoughts about current situation of the world and it’s effect on investing: https://youtu.be/_TUTZ4ea42E

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24

Small Update:
I wanted have some exposure to Pharma Sector. As Alembic Pharma came with Nice Q4 results, I have purchased some shares around 800 Rs.

Thereafter I have gone through entire thread of Alembic in our forum. I was very happy that Hitesh and Ankit Gupta sirs have invested here. But somewhat disappointed that They are no more invested. I have also gone through Alembic Pharma Annual Report…

Since last 2 days I have read Annual Reports of Lupin, Torrent Pharma, Ajanta, and CIPLA extensively. But this pharma sector is too difficult to understand. I am really overwhelmed with all the complex terminologies.

More I read more I am confused. I just cannot differentiate between different pharma companies. All are targeting US Generics business with number of ANDA filings. All are saying they are spending significantly in R&D. Each one of them say they are into Speciality Products.

But after extensively covering CIPLA, I feel this company is doing something different. They are 3rd Largest in India, Ranked #2 in Chronic Therapy. They have 22 products in top 300 brands - Leaders in Respiratory and Inhalation segment. I can see many products already in market and many in clinical trials as a result of their R&D.

Now I feel I did a mistake of first investing and then doing research. In the Alembic Pharma topic there is some issue like related party transactions etc. Financial results of Lupin so far hasn’t been great. Thinking of Concentrating on Cipla and Divi’s only.

I am also stunned by market going up so much so fast!

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Alembic group used to have some corporate governance issues. Not tracking so not sure if Alembic Pharma is owned by different family members. In general if you feel understanding any sector like Pharma is difficult and you want exposure, then go with good sector funds like DSP Pharma fund by Khemka or Reliance Pharma Fund by Sailesh Raj Bhan.

Lot of people staying in home and speculating. I am very worried that this is not going to end well for most and have been warning in all my posts and doing fire sale of my portfolio. I think smart money is putting a trap and people feeling FOMO and buying stocks, down-move will come soon. In my work call, two people who were not investors said they have recently bought Reliance and Bajaj Finance :slight_smile:
We need to survive this period and not worry about missing this upmove.

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Investing in a good Pharma Fund, that is a good suggestion Bhaskar Jain Ji. I did not thought about it. But in this lock-down period I would like to research market as much as possible and study different sectors and wish to Invest for long term on my own.

I am working in a small firm in a unsecure job. I may not lose job but know for sure that there will be salary cuts or no increments. in this circumstances I wish to have an alternative income via stock market.

I have promised myself that I will not rush for the fear of missing the bus but invest slowly over next 6 months or so after the Covid 19 destruction on economy is fully understood.

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I know your background that is why cautioning. Getting regular income from stock market looks very exciting and doable but it is very very difficult if you do not have “holding power” i.e. you have other sources of income or good net-worth. Stay safe.

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29

I am sorry to say that my computer system had some problem 2 weeks back because of which I was unable to update. But I have got it done now.

Of my existing portfolio, I sold my RIL-RE shares (total 4) and pocketed about 1000 bucks. First, I was not sure of how to apply online. Then, there is part payment and I got worried what would happen if I miss making remaining payments on time. Last, I thought 4 more rights share would not make too much difference.

I sold some HDFC and HDFC bank shares and brought down my exposure to financials. Also, sold some DMART shares. After I tweaked, these have gone up and I lost some profit as of today.

Additions to Portfolio:

I already have Divi’s and Alembic. I increased Divi’s. I have added Cipla, Dr. Reddy’s, and Lupin.

I have read HDFC life topic in our forum and felt this sunrise sector has good future and added it in my portfolio.

Telecom is talk of the town and I have added Bharti Airtel. Along with this, I have also bought Bharti Infratel!. Although, last year there was lot of disruption because of Vodafone Idea, I think possible merger with Indus Towers would improve key parameters like Average Tenancy per tower - Average revenue per tenant per month - Average revenue per tower per month etc. But if this deal does not go thru, I have to study implications. Also I formed a logic: If Voda-Idea survive, Infratel will do well - if not then Airtel will do well - some kind of an hedge!

Some of the misses during this time:
I studied Biocon Annual reports, Quarterly presentations, and our forum thread greatly. I was very much convinced that Biocon and Syngene should be in my Portfolio. Just look at the board of Biocon - we have terrific intellectuals with amazing qualification. I think no other Indian Pharma company have such a great board members. but when it came to biting the bullet, I became little reluctant because of valuation. Thought I will wait for some correction and missed the bus!

VST tillers - excellent agri play. On May 5th, I actually opened trading window. Was about place buy order at 880/- just then I thought - I have not read Annual Reports or studied the company. Could Escorts be a better bet? Let me study both and then decide. Then I got busy in my work and then my computer system gave up on me :frowning:

A blunder - INOX! During my initial investment time, somewhere in my mind, I had PVR/Inox but because valuation and my limited understanding of the business, I did not think about it. In March market collapse Inox went to a low of about 250. Thereafter I waited for it to go below 200. It almost went there but did not go below. On May 8th I managed to buy it at Rs. 205. My bad luck - from next day onwards, It kept on going down and down. On May 18th I got so fearful that I sold it off at 175 or so and had a sigh of relief. And my misfortune - from next day it kept on going up an up and look where it is today. To this day, I do not know why I bought it and why I sold it!

Lastly on 18th May there was a news on CNBC TV 18 about delisting of United Breweries - and I have added it. It is just a buy on rumour - sell on news. An experience I wish to have.

My Portfolio with Average Buy Price and Weightage:

HDFC Bank | 1050 | 7.5%
HDFC LTD | 2000 | 5.7%
Kotak Bank | 1350 | 1.2%
HDFC Life | 505 | 2.9%

Divi’s Labs | 1860 | 5.3%
Alembic | 787 | 2.7%
Lupin | 810 | 3.5%
Cipla | 578 | 3.3%
Dr. Reddy | 3660 | 4.2%

Reliance | 1250 | 21.4%
Airtel | 530 | 3.8%
Infratel | 180 | 2.3%

D-Mart | 1900 | 21.7%
United Sp | 552 | 2.9%
RITES | 250 | 1.5%
SRF | 3450 | 3%
Garware Tech | 1296 | 1.9%
Shree Cem | 19130 | 5.5%

PS: I am thinking of buying a NEW Laptop Leaving the Desktop to my little Kid :slight_smile:

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I have invested a tracking position in Minda Industries.

It is mostly focused on India. It has almost equal revenue mix between 2 and 4 wheelers. Not disrupted by BSIV to BSVI and I feel they are not too much affected by EV in future also.

I am a bit concerned about too many subsidiary / joint venture companies.

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I have been going out to work and it’s a great feeling being busy…

I have invested a tracking positions in PI Industries, Pidilite, and Navin Fluorine. Waiting for market to fall but it is going up and up.

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@Jaisish_Mohanty - I myself a new kid on the block in investing - how can I give any feedback… You open a new topic about your portfolio with your rational for investing in these companies and seniors in this forum will respond.

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Small Update of my Portfolio:

Exited From:
Bharti Airtel and Infratel. Too much of noise regarding AGR & Court Cases. The business growth depends on ARPU etc. Sold off with No loss No Gain.
United Spirits: Purchased it on rumour of delisting which I Understood that not the way to Invest.
Lupin: Felt it better to concentrate more on Dr. Reddy’s and Divi’s.
Shree Cements - Cyclical and capital Intensive Business. High Price per Share.
RITES - Difficult to understand business model.

Now, Most emotional decision: I have reduced my allocation In DMART by more then half. First it is richly valued stock. I am not sure how long the pandemic will affect the business and Reliance is getting Aggressive… It really hurt me selling.

I have Increased allocation in Kotak Mahindra Bank, Dr. Reddy’s, Divi’s and SRF.

I have made new Investments In:
Aarti Drugs: Largest producer of many API’s in the world! Awarded by Abbott India as Business Partner of the Year and Good Revenue / EBITDA / net profit CAGR for 4-5 years.
Laurus Labs: Mind-blowing Q1 Results. API Player. It’s an opportunistic bet.
Deepak Nitrite and Alkyl Amines - Specialty Chemicals opportunity.

I have made a change in my portfolio presentation. Earlier I calculated allocation %ge the Amount I Invested in Equities without taking in the Cash I Had. Now I have taken Cash and other Investments into allocation.
My Current Portfolio with Average Buy Price and Allocation %ge:

Reliance | 1250 | 5.6 %
DMART | 1900 | 2.8 %
HDFC Bank | 1050 | 1.2 %
HDFC Ltd | 2000 | 1.5 %
KOTAK | 1335 | 0.6 %
HDFC Life | 505 | 0.75%

Dr. Reddy’s | 3860 | 1.7 %
Cipla | 578 | 0.9 %
Divi’s | 1910 | 1.7 %
Alembic | 801 | 1.2%
Aarti Drugs | 2260 | 1.7%
Laurus | 963 | 0.7%

PI Industries | 1557 | 1.15%
SRF | 3570 | 1.3%
Deepak Nitrt | 563 | 0.8%
Navin Fluo | 1759 | 0.8%
Alkyl Amine | 3042 | 0.45%

Garware Tech | 1296 | 0.5%
Minda Ind | 288 | 0.4%

HUL! | 2222 | 0.5%
ABBOTT | 15492 | 1.15%

PMSSY ----> 18.5% Investment:)

During this pandemic period, My wife managed to get a small earning stream - which she will be Investing in PM Sukanya Samriddhi Yojana. At the same time I have tried to tech her about Equity Investments to the best of my ability. I have created a portfolio in which I will make SIP investment every month or so and opened this With HUL and Abbott.

Currently my Equity Investment is 27.3% PMSSY 18.5% & Cash to be Invested is 54.2%.

I am wholeheartedly thankful to this forum. I sometimes get so overwhelmed by the knowledge of the experienced members. Even new guys come with so much insights and thought on various businesses.

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36

I have Invested an Initial position in Infosys and HCL Tech…

I always wanted some allocation to IT in my portfolio. It was very difficult for me to understand this business. From last week, I started exploring websites of IT companies and reading annual reports and quarterly presentations. More I read more confusing it is. I just could not differentiate between TCS - Infy - Wipro or HCL. Everyone talks about digital transformation etc. But to this day I cannot understand what is DIGITAL… Artificial Intelligence - IoT. I was in two minds whether to invest in something which is overwhelming or just leave it alone.

But then few months back, I did not understand anything about Pharma. At that time also I could not differentiate between companies. But once I started Investing and started reading annual reports, I am now fairly familiar with terms like API, CRAMS, CDMO, Etc.

I am aware that Indian IT firms may not become FANG like but they are good at day-to-day management of IT infrastructure of their clients. Also, I feel US$ will keep on getting stronger which is an added advantage.

Infosys website is very easy to navigate. The annual report is very reader friendly. Digital share of revenue is growing Q-on-Q and now contributes more than 40%. HCLT too seems to be catching up with biggies very fast and well focused on Digital Transformation. TCS website is very bad. Their Annual Report link fails to open. It is most Investor Unfriendly website…

I wish to allocate more than 10% of my portfolio to IT.

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I am from IT industry. so do not get attracted by words “Digital Transformation”. every couple of years new words appear and companies try to re-group their business under those for better traction.
If a company says 40% in “Digital Transformation” , Is it getting better billing rate per person for these latest skills? if not then there is no value add. if true then it should reflect in their profits, margins…
so better look at numbers : growth, margins, Management quality to decide on which one is better…reading Annual reports may add to conviction

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You are right babuchit that every tom and harry in IT industry boasts about “digital”. I have gone thru the annual reports of 7-8 IT companies - but unable to make my mind who is better. It is exactly similar to Pharma - where everyone boasts of “Specialty” “R&D” Etc. Both these industries were struggling for last 2 years but now because of COVID they have come into limelight.

I have invested in pharma large caps just when there was hype and same is happening in IT now. I am waiting for Q2 results to see how they perform.

Since you are into IT can I ask you what is “Digital” and how is it different from what they were doing till now. And according to you who is best. Thanks.

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IT companies wise - business that involve Could, Internet of things (Bluetooth, WiFi, Zigbee etc) , Machine learning , Big data etc

Refer this link to get some idea

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Excellent link Bro! I just glanced thru it. I will dig it more. I feel opportunity is huge, but how far Indian IT firms geared for it and who will grab the most to be seen. Thank You.

41

I have sold about 40-45% of my holding in Reliance. It has given 90% returns. I feel immediate future returns in JIO and retail priced in. I will definitely buy if prices go down.

At the same time, I have taken a small position in TCS. I have extensively read AR-1920.

Surprised to find they have scientists doing some research in Pharma and have 31 new molecules that hold promise towards finding a cure for COVID-19! They are using AI for initial drug design and working closely with India’s Council for Scientific and Industrial Research (CSIR).

Ranked #1 in customer satisfaction in Europe by Whiteline Research for 7 year in row. Recognized as a Global Top Employer by the Top Employers Institute.

They are into Block-chain technology. Launched TCS BaNCS on Cloud.

Chosen by the Reserve Bank of India as its strategic partner to design and implement an AI-based centralized information and management system. TCS implemented a Digital Hub in India Posts with POS solution across 80,000 POS terminals , making it one of the largest such implementations in the world. Worked with Pradhan Mantri Jan Arogya Yojana (PM-JAY). All these may not give too much of a margin - but I am happy that they are doing something for our country.

Tcs has 448464 employees with avg age of 31 years out of which more than 3.5 lac trained in DIGITAL technologies. Attrition rate of 12.1% is lowest among peers globally also.

I am still in process of exploring IT sector and in 6 months or so wish to have more than 10% allocation here.

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I have taken a blind leap of faith - throwing caution to the wind and Invested an Initial position in GMM Pfaudler below its OFS Floor price of 3500.

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I have increased my investments in IT - TCS, Infy, and HCL tech After nice Q2 results.

I have taken initial tracking position in L&T - thanks to @nav_1996. It will give me indirect exposure to midcap IT. I have read the Q1fy21 Investor presentation and am somewhat confident about the management. I feel currently it’s undervalued.

And today, I have bought reasonable quantity of Granules after excellent Q2 results. I thank @Malkd for timely post immediately at the announcement of the results.

HUL too has come out with good results thinking of Increasing allocation here if there is any price correction.

I am putting my ears on the ground w.r.t. Q2 results and slowly building the portfolio…

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Cheers caution investor. Good decision with granules imo. Getting that same feeling right now that I had the night of Laurus Q1 result… Which was to try to clear up as much free cash to invest as much as possible lol. Such opportunities to catch a stock with a clear path from management itself towards becoming a 2X /3X in 1 or 2 years don’t come around very often. Good luck to both of us.

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