I have been a reader of Valuepickr for some time now and have benefitted immensly from the quality of discussion here. Putting my portfolio here for thesuggestion of senior members.
Ajanta pharma 34%
Kaveri Seed Co. 20%
La Opala 15%
HCL Tech 14%
Cera 12%
Pi Ind 4%
Most of the stocks are widely discussed at Valuepickr, except for HCL Tech which has been added as a large cap to provide stability to mostly small cap portfolio and also to benefit from Ruppee depreciation.
Some changes to the Potli:
HCL Tech gets a boot, while PI, Kaveri and Cera get more allocation. Astral makes an entry as the sixth stock, while La opala is pruned a little bit. Ajanta is the only stock in the portfolio that remains untouched. To certain extent the switch between HCL and Astral is based on the premise that Rupee has depreciated enough and may not go below 65 for the next year or so and it should make little bit of reverse movement. HCL Tech is mostly a play on a week rupee as it has not increased number of employees(the biggest raw material for a software company) in last one year. Also, growing the number of employees from a 85 k base in a meaningful way may be difficult. Here is the new look Potli.
Ajanta Pharma 29%
Kaveri Seed Co. 24%
Cera 15%
PI Industries 12%
La Opala 12%
Astral 8%
Some musings on the potli:
Kaveri is the cheapest stock in the Potli at 11 times, while Astral is the costliest at 18 times on TTM basis. Of course, on a forward looking basis, most of the stocks in the Potli are looking very cheap and ripe for a bounce. Performance wise, here is how the stocks performed in the last quarter
Stock Sale Growth Profit Growth PE TTM
Ajanta 25 66 16 (Will be 14 odd if we exclude one time tax)
Kaveri 53 60 11(Hard to find such combination in the market)
Cera 40 21 13
PIIND 70 107 14 (Now thatâs what I call performance)
Laopala 19 61 17
Astral 41 25 18
All the growth data is year on year.
Sales growth wise, the best performers are from agri segment(Kaveri and PI), while the worst performers are La Opala and Ajanta. Profit growth wise the best performers are PI and Ajanta, while the worst performers are Cera and Astral, both of which has been hit by declining Rupee, which IMO should not continue going forward. Only two stocks in the portfolio, La Opala and Astral are trading at pe of 15 and above, but most likely they will have a high profit growth going forward and become cheap.
Gyan,
A pretty impressive portfolio. I think you can add financial stocks gradually in your portfolio which is a one sector missing in your portfolio. Can you also indicate your average buy price? Also, do you invest on lump sum basis or on SIP basis?
Regards,
Ankit
I was planning to add yes bank on declines, but I was not ready for the kind of decline that has happened in the counter. Rationally, I should have been happier to see the stock fall more than my expected purchase price, but ferocity of the fall has made me rethink. I am no longer sure about adding it(canât explain the why of it to me).
I earlier used to own HDFC bank and specially I used to use it as a cash replacement. I am almost always 100% invested, so any time I need to keep cash, I used to buy HDFC bank instead of keeping cash. I had gotten at least two gains of almost 100 Rs on this counter(500 -600) and (625-715) using this method in last one year or so. Going forward, if I find cash and not sure where to invest, I will fall back to same formulae and hope to succeed.
It is a little difficult to tell buying price for most of the stocks, as I keep buying and selling them from time to time. Each stock will have its own story. Like I started buying Ajanta somewhere around 100 Rs.(split/bonus adjusted), sold initially with some losses, then again repurchased at 100 to sell at around 150. Again purchased between 175 and 200 substantially and some of that even purchased around 400. Current holdings show 220 as purchase price for Ajanta but I know that I have booked profits earlier also, which is not reflected in current price.
Similarly, Kaveri was purchased around 850 last year. sold between 1200 and 1300 and purchased again back around 1280-90. Some of Kaveri is even purchased at almost all time high of 1720. Average price of current lot shows 1372.
I entered Astral around 210 and sold around 360 and recently entered around 560. Missed the rally post 360-560 completely.
Cera is purchased around 425. Though I am a very old invetor in the counter and had invested around 60 Rs in 2009 only to sold it around 120 or so.
PI and Laopala are recent purchases with PI purchased around 134 and Laopal has been purchased between 250-330 and a portion of it sold around 420.
I do SIP, but my lump sum is way higher and SIP does not represet more than 1% of the lump sum.
Thanks Gyan. Something I wonder there are a lot of âChupa Rustamsâ like you amongst us in Value Pickrs who are very good in stock picking as well as in identifying good entry points into them.
No chupa rustam just a learner with my fair share of mistakes and tution fee
Added some HDFC Bank during recent carnage.
Here is the new look portfolio.
Ajanta Pharma 31.50%
Kaveri Seed Co 21.30%
Cera Sanitary 13.90%
La Opala RG 11.60%
PI Industries 11.00%
Astral Poly Tec 7.80%
HDFC Bank 3.00%
Very Well organised PF.
Found this on the net and realized that my strategy on HDFC Bank is a well known âPlaceholderâ strategy used by Mohnish Pabrai.
Another Pabrai concept is the âplaceholder.â He contends that money sitting in the bank is actually risky because of the potentially declining dollar. Economically speaking, this is true. To combat the risk, Pabrai believes one should invest the cash in something safe, yielding enough return value. Currently, he is using Berkshire Hathaway as a placeholder until he finds other cheaper investments. Putting the money in the hands of the worldâs greatest investor seems like a better idea than leaving dollars in the bank.
Here is the link to this rather old article.
http://www.gurufocus.com/news/8046/pabrais-perfect-portfolio
Also, sold the HDFC bank purchased during the carnage with a 10% profit and portfolio goes back to the old six stocks.
Sold off La opala, brought in HCL Tech. Here is the new look portfolio.
Ajanta Pharma 37.9%
Kaveri Seeds 17.3%
Pi Industries 14.2%
Astral 12.9%
Cera 12.2%
HCL Tech 5.6%
Ajanta and PI has been superb performers of the last quarter and their weight in the portfolio has increased. Kaveri on the other hand has not performed much and hence appears with a reduced weight in the portfolio. Astral and Cera has been average performers. Sold La opala got split between Astral and HCL Tech.
Time for mother Ajanta to give birth to a baby. sold 10% of existing Ajanta allocation and purchased RS Software. Also, recent outperformance makes PI the second largest holding in the portfolio. Here is the new look portfolio:
Ajanta 32.9%
PI Industries 16.6%
Kaveri 16.5%
Cera 12.4%
Astral 12.3%
HCL Tech 5.3%
RS Software 4.1%
Whats your take on RS Software at cmp? could you highlight the reasons , moat n opp size?
The foremost reason for investing in RS Software is the valuation. It is available at 5 pe with good growth, ROE and decent balance sheet. It is available at 2% dividend yield with tailwind of depreciating Rupee supporting it.
There is a RS Software thread where we have discussed about its moat and opportunity. My own thinking is that it is a software services company focused on payments vertical and have some specialization in that. It also has long term relationship with its customers which is difficult to beat. If the company shows decent profit growth going forward, the returns could be pretty good.
Thanks Gyan.
Whatâs your take on Kaveri? Inspite of good performance why is valuation still cheap ? Is market having doubt on its ability to replicate its sucess in Andhra in Maharashtran Gujarat?
I am invested in Kaveri but nonplussed by its performance this year . Last year it had run up by this time period from 800 to 1200-1300 post similar results.
I think Kaveri is not performing bacause people are worried about their performance in third and fourth quarter. They believe that in near future this company is not going to post good results and subsequently the stock will remain subdued. I think Kaveri will consolidate till March - April, and should have a fairly good run from then on, but timing such things is really difficult and I am staying put.
Happy to see my analysis of Kaveri going wrong. It has given a nice and clean break out and hitting new highs. Of course, pending stock split is the reason behind current bullishness, but I am not going to complain.
Meanwhile, added more of RS Software and HCL Tech to the portfolio. Here is the new look portfolio:
Ajanta 27.1%
Kaveri 15.6%
PI Industries 14.4%
Astral 12.8%
Cera 12.6%
RS Software 10.5%
HCL Tech 7.1%
Great to know about your conviction in Kaberi paying off.
Have u studied Aurobindo Pharma highlighted at such a right time by Hemant Gupta. Seems there is lot of juice still left as eps xpcted is 30. & 38 for next 2 years n moat in form of Anda pipeline is extremely strong? Valuation seems very cheap even now.
Considering checkered past of promoters, I will keep myself off Aurobindo, even though it is rightly poised currently.
Booked some profit in RS Software and moved the money to HCL Tech. Here is the new look potli.
| Ajanta Pharma | 26.83% |
| Kaveri Seed | 15.24% |
| PI Industries | 13.69% |
| Astral Poly Tec | 13.24% |
| Cera Sanitary | 12.77% |
| HCL Tech | 11.39% |
| RS Software | 6.85% |
