ValuePickr Forum

Hitesh portfolio

@hitesh2710 sir, are you tracking Bajaj consumer ? Management is guiding for 4x profit in next 5 yrs. Any insights on management quality as shares are pledged.

Thanks Hitesh bhai for the input ! Good to hear the clouds are clear. As you stated earlier, the basket approach is something will work in the case of PVR & Inox.

Hi Hitesh bhai,
1 Bajaj Finance is one of the established nbfc players . However they dont have access to CASA like pvt sector banks like HDFC bank . In such a case , how would they keep their cost of funds low without ECB etc ( ECB etc could it not be a risky source of funding ?). In such a case , going forward, would growth prospects of banks like HDFC bank be better than Bajaj Finance?
2 How does Sundaram Finance compare with Cholamandalam?
Many thanks

@A_shah, Bajaj finance has top rating and hence can access funds from banks or any other institutions at very competitive rates. The key to monitor remains the spread between the borrowing and lending costs.

I used to track chola but exited some time back. Not tracking sundaram too closely so cannot give an opinion which is better.

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Hitesh bhai,
1 What’s your view on honeywell automation and kotak mahindra bank?
2 Like how we have limit in portfolio allocation for different companies , is it necessary to have group exposure i.e limit exposure to same group stocks although companies may be different ?
Thanks in advance

Hitesh Ji,

Whats your view on ITC and GCPL. Both are quoting at decent valuations do you think these are good picks for long term accumulation (SIP)?

I would also love to hear your views on my portfolio picks - Seeking advice for Siva's portfolio

Thanks in advance.

What is your view on Auto Ancillary companies?

View on varroc, endurance n sandhar technologies ?

Hitesh Ji , I know you wer keen admirer of Tourism finance corporation . The stock is near to it’s book value as per screener data . Does the tGovt TAG on it the working is not happening as a private company . Company has reduced it’s debt . It has long history of paying dividends .But it’s exposure to COX and Kings who used commercial papers for working capital takes it down with itself . How you view the company in the next 3 to 4 years .The good signs is that company has reduce Gross and net NPA from 2017 to 2018 bt as from FY 2018 it start giving loan to NBFC as well doesn’t it will be changing the focus of the company … Could you help me to understand the concept of ROTA and NIM how one can calculate these and what is the effect on assessing the valuation of any financial institution ? It will be a great help .
Regards

Hitesh sir,
Are u continue to holding in Unichem Laboratories. Or any thoughts on current situation. (After selling business to torrent and buy back)

Hitesh sir, would really like to know your views on holding Indian home grown FMCG companies for real long term with coffee can style investing…the likes of Marico, Godrej consumer, Dabur, Britannia and Tata consumer products? We have seen what p&G, Colgate, Nestle etc. Have done in their home countries with great returns across business cycles, wars, recessions, depressions and consistently growing dividends. Is it fine to expect Indian homegrown FMCG MNCs to replicate the success across decades? Do you see any significant risks? I see main risk in India of promoter and corporate governance…can we trust above names for decades? Or is it wiser to switch to Indian subsidiaries of MNCs like hul, nestle, 3M, p&G etc. If idea is coffee can for couple decades? I know it’s very long time but the only sector where we can even dream of thinking this long is FMCG and hence curious. Thanks

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@sivaramtvl

I track and like godrej consumer products. Stock has corrected in sync with poor results. In q4 fy 19 concall management seems to be indicating about a plan to spur growth revival. If that materialises and company resumes its growth there can be good returns.

ITC suffers from fear of perennially increasing taxes on cigarettes. If one has very long term views of say next 5-10 years it seems okay.

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@bhaskarbora67

Autos themselves are reeling under poor sales numbers. Its very difficult to predict when the cycle will turn. But stock price movement of the frontline auto stocks should give some inkling. Plus improvement in monthly sales data for a few months in a row can be an early indication of cycle turning. As of now there are no indications of anything positive happening in the sector.

The companies you listed are good companies but unless the cycle turns for auto sector I dont see the auto ancillaries doing much.

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Hiteshji,
The consumption stocks are the secular long term secular growth stories in the Indian market. They are almost all of them are overvalued. But with the economy slowing, these stocks are also showing signs of weakness. Titan has come of a bit, Asian Paints and Pidilite are also showing some weakness. What is the ideal strategy to buy them? Since I have no knowledge of technicals, I used to buy such stocks when they break their 52 week lows? Is it too amateurish?

@hiteshchauhanca

Only a few days back I was looking at unichem again after having looked at it earlier and held it for some time and selling out after seeing no signs of value unlocking. I was expecting some kind of buyback again but that didnt materialise.

Value investing works only if there are any triggers lined up for unlocking of value. Here there is close to 1000 crores cash on balance sheet but it is not put to much use. Capex etc is being done but is as of now not showing any results. Till the time company starts reporting decent numbers, upsides seem difficult to materialise. Downside though could be limited in view of cash on BS.

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@Investor_No_1

Indian FMCG companies have had a stellar track record of wealth creation over the years and most of them have very good managements. So on that count atleast things seem okay. I think the way they have re invented themselves and kept growing by adding new products and new geographies, most of the managements have proved themselves.

I think for purpose of a coffee can, an ideal solution can be a mix of domestic and MNC companies if one is ready to live with temporary setbacks.

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@JOSE_ABRAHAM

Most of these secular consumption stories are seeming to be having a temporary halt/slowdown. One cannot imagine long term slowdown in these companies looking at the Indian demographic map. So I think these remain good structural long term stories if one has sufficiently long term view. And if one is buying for 5-10 years, buying for such a period atleast can be staggered over 5-10 months. That I guess should help in cost averaging even if these might go down.

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@hitesh2710 ji,
What is your opinion on the long-term growth prospects of the medical device industry, and how you see Poly Medicure grabbing the opportunity?

Sir

FMCG companies get sky high valuations 40+ pe.
Based on HUMAN HABITS CANT CHANGE and CONSUMPTION will always increase.
Than why rice companies are available at pe of 5.
Does one can thing brands like Dawat will get tha5 pedigree in future. They also have good presence in USA UK and other 40 conutries.
Does they come out of all the hurdle using Brand power.

Thanks

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@hitesh2710 Hitesh bhai , What’s your view on Britannia?

@Kuldeepjadeja

Its difficult to compare the business characteristics of FMCG and rice companies. Just a cursory look at the balance sheet of these two types of companies should answer your question why there is such a valuation difference.

While most of the FMCG companies work on a negative working capital, rice companies have stretched working capital situations.

KRBL seemed the best company in the rice space but it also seems to be having issues of its own looking at the kind of price cut it has had in the last few days.

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