Chet's long term Portfolio

Hey Gents and Ladies,

Would be great to have your thoughts on my portfolio (recently accumulated):

  1. HDFC - 10% - entered when this was down a couple of months ago - wish to allocate somewhere else, possibly CanFin

  2. L&T Finance Holdings - 10% - i feel this is a great franchise being developed and could compete with Bajaj in the long run

  3. Indostar - 10% - Feel this is undervalued and with a decent quality book (not amazing quality); NPAs have been rising but feel all bad news are priced in at about 180-190 price range

  4. GAIL - 10% - India’s valuable gas pipeline / transmission assets at 10 pe multiple; I feel INdia is gradually switching to natural gas/ LPG. this is my favourite stock for next year; now that Gujarat Gas and IGL have risen

  5. MCX - 10% - Monopoly Exchange - valuations are still not so rich for me to consider exiting

  6. Karur Vyasa Bank - 10% - undervalued decent corporate and retail book; NPAs now stabilised; feel that there is only upside here

  7. SOBHA - 10% - interest rate sensitive play- as interest rates go down, real estate will pick up; good affordable housing unsold inventory here

  8. Maithan Alloys - 4% - was a value play (realised that they have capacity cap that limits upside) and have been reducing this stock on rises; want to switch into other cyclical plays

  9. Dishman Carbogen - 4% - another value play of asset light pharma labs business; unsure of governance

  10. L&T Technology Services: 4% - good rising technology and engineering firm; have been accumulating

  11. L&T; PNC INFRATECH; HG INFRA ; NCC - 20% ; India construction story: accumulated these on their way down and now in green - but can hold onto these

There is also a small long tail capital goods portfolio (DISA INDIA, TRIVENI TURBINES) + long-short Futures portfolio, but it is relatively minor

The only part of your portfolio that makes sense to me now for the long term is NO 11 point

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You are right - i thought about my post and wanted to change the title to ‘Green shoot portfolio’. I think in the long term i will hold onto the construction story, LTTS, L&TFH and MCX. others need to be swapped with long term ideas as soon as green shoots appear (because of interest rates, slower asset deterioration)

Some green shoots appearing now especially in HDFC and L&TFH - I am quite keen to see the results next quarter , especially L&TFH provisioning and cost of risk.

Think will hold HDFC till next year and see how mr market values it’s strong balance sheet.

Update : reduced Maithan by 2 percent and moved into L&T. Feel like Capital goods is being ignored currently in this banking led run

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Exited indostar after recent rally and moved into Shriram transport finance - expecting Scrappage policy to help M&M as well.

also exited DCAL (took a 35 pc loss- lesson learnt) and moved into Edelweiss

KVB exited after CEO resigned, moved into Indian bank at its lows.

Sriram Transport Finance has given 25% post budget and stellar results; L&TFH as well has returned to its 52W high due to RBI policy; Exited LTTS after a good rally.

Wondering what will be the next wave of contrarian plays; Candidates are : GAEL, ONGC, L&T, BEL (gradual before next quarter turnaround results), ITC (which should show that cig. demand is not that elastic to price hikes) & NBCC (showing decent cash flows)

Any tips from anyone?

Ongc has got good dividend yield and extremely inexpensive but got only 1 problem govt is looting it . They are planning for ovl ipo in 2021 or 2022 which is highly positive and value unlocking also gas production will get improve by 2021-22 . Other than these triggers share will be volatile based on global events. Nbcc has got 1 lakh crore order book but execution is tepid and redevelopment projects in Delhi is stuck due to court orders also majority of their order is from govt’s but it seems all these factors are already included in the price