Sir do you track ONGC?
Thanks a lot Hitesh Sir for your thoughts. As always, you have put your thoughts clearly in the replies which benefits all the investor. This is one thread which I am sure everybody tracks closely to get your opinion.
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Hi Hitesh bhai,
Whats your view on Infoedge and Affle ? Many thanks
Thank you for pearls of wisdom and candid admissions. Since selling is as important as buying, I wish Art (and science) of selling 2.0 will be a new possible thread for harnessing power of community in learning.
HDFC AMC Q3 2020 results show growth in revenues and PBT, but the net profit is lower. Has anyone analysed the results and post the views here?
@Pke ONGC has not been a great wealth creator in terms of capital appreciation over the years. Just to check this I saw the historical charts and adjusted for splits and bonuses etc, it has gone up 8 times in last 18-19 years which is not great. While looking at a company with long history to invest for the long term, its important to check how much wealth the company has created in the past. If one is looking for short term trading opportunities then its okay but I would not consider Ongc for long term as it is besieged by factors beyond its business in terms of govt interference and very poor execution of a wonderful business.
@A_shah I dont track info edge or affle india. Regarding to your earlier query about havells, results have been lacklustre and hence stock price likely to remain under pressure/sideways. This can be a good opportunity for guys who want to buy compounders at cheaper prices. A look at screener data gives 10 year cagr at 26% but in shorter term of 3 and 5 years this return matrix has reduced. I think if Lloyds acquisition is integrated and company can show decent growth, it can again achieve higher growth trajectory. One needs to listen in to concall, go through annual reports to get an idea about growth prospects.
@atul1082 HDFC Amc growth in profits likely to moderate to 15-25% going ahead in a quarter or two as normalised comparision sets in. Against that, the investments in MF by domestic investors is likely to keep growing and hence runway for growth for HDFC Amc remains very long. Plus the business throws up huge cash flows and has big scope of operating leverate in terms of improved profitability as fund size increases as incremental expenses are minimal. Only flaw in the ointment can be further regulatory intervention to reduce their fees and hence affecting profitability. To me, as of now it seems priced to perfection.
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Hi @hitesh2710 sir, do you have any views on Sirca Paints? The company is in growth phase with decent numbers and expanding into new verticals.
Thanks!
Hello@hitesh2710, Sir do you have views on Shankara Building Products? Especially as it was projected to be Home Depot, while execution remains key, do you see business like this sustain in India in foreseeable future, many thanks.
@hitesh2710 : Where can we get NPAs of the NBFCs? Does any site offer on consolidated basis of NPAs of the companies in tabular form?
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Hi Sir, What do you think about Suven life science? It is available at 1.52 PE which is very strange. Book value of the stock is 72 and stock is at 0.24 of book value. Also debt is 0.13 and promoter holding is 60%. How do we look at this type of company which looks good on screener. What are your thoughts on low valuation? Sorry for my limited knowledge.
I had a look at sirca paints. It seems a good company on the verge of strong growth phase especially in the wood coatings space. Their wall color venture needs to be watched as there these guys compete with biggies like Asian paints and other color majors.
The growth though on a small base seems good. And with the company coming up with its own manufacturing facility and having the license to sell in adjoining countries, this growth can continue.
Some worries are on the receivables front (though management has addressed that in last concall) and variables like forex movements as company imports a lot of stuff from Sirca. They have done a great job till now of growing on a asset light model but with commissioining of their new plant one needs to see how things pan out.
Overall certainly a business to keep on the watchlist. Thanks for bringing it up.
@atul1082 not much idea about NB ventures.
@Amit.rahate131 Not much idea about shankara. It has had a massive fall from 2000 plus levels to sub 400 levels so must be some strong reason for it.
@kumars1672 I think you are looking at suvenâs demerged portion. Try to look at demerger announcement where all the details will be there.
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Hi Hitesh bhai,
Whatâs your view on auto ancillary stocks?
Is it the time to enter or still one needs to wait ?
Many thanks
Hi Hitesh Sir,
Since you are a doctor by profession and would give the most accurate analysis of Biocon. Is this a company in pharma sector that one should invest for long term as a multibeggar?
Please comment. Thanks.
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@desi.guru Biocon can be a good compounder if its promised story plays out as per plan. I am not too sure about long term multibagger thing in case of biocon. Going forward, pharma companies are likely to face stiff competition in the US markets and domestic markets will also have a limit beyond which companies will find it tough to maintain earlier growth rates. Few outstanding companies will do well and create wealth but as of now its difficult to figure out from which basket they will emerge.
@A_shah With change in sentiments, there might be a case of auto ancillaries as a lot of these beaten down names also are making a comeback besides the good quality beaten down names. My view is one should look more closely to find out structural growth stories which one can ride for next 2-3 years in small-midcap space rather than get into things like auto ancillaries. Again one cannot take a basket call here too as there will be outstanding companies within this space as well but will need a lot of hard work and digging to uncover.
I think the current market is a time when one has to work hard and try to find out good companies decent managements and balance sheets and good visibility for next 2-3 years available at cheap or moderate valuations. Approach has to be bottoms up to find out these companies rather than look top down because as of now there does not seem to be a single sector which promises to be a market leader. ( after some time maybe something might come up but as of now I dont see any big sectoral moves. )
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Human psychology is designed such that in bear markets we look for defensive large cap plays, during transition period towards bull markets, scout for midcaps and amid extreme bull markets hoard small caps. But structural stories remain structural in all market cycles. If we could become MCap agnostic and only focus upon balance sheet strength, earnings growth & sustainability and management quality then outcome will be far better than the usual.
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Guruji,
Any thoughts on the spreading of corona virus on the market n any stocks in particular on both sides of axis??
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@hitesh2710 ji,
Can you please explain what you mean by âstructural growthâ stocks? Which kind of companies come under its purview?
I seem to have only a vague idea about this. I think those are the ones which are making a transition to become more streamlined, be it cost optimization or better operational management or upgraded strategic prowess.
@hitesh2710 sir your views on JM Financial ltd, reported good set of numbers and has given a good breakout on daily and weekly charts.
By structural growth stories, I meant companies where there was decent growth visibility for next 2-3 years atleast. Especially in the small-midcap basket. Here what has happened is that because of prolonged weakness in the small and midcap space, companies reporting decent results since past 2-3 or more quarters or even longer have not been rewarded/rewarded enough by the markets in terms of price appreciation. These are the ones where one needs to focus to get these stories.
And once we find out these companies quoting at decent valuations, efforts should be made to find out what the source of growth and profitability are and whether they are sustainable or not. Most of these answers are often found in annual report or concalls etc.
e.g I am invested in KPR Mills. I have earlier also mentioned it in my thread. This is a company that has gradually been changing its business model from a commodity type predominantly yarn manufacturer to a company which derives a large chunk of revenues from garment manufacturing which is a more stable and sustainable business. Garment sales has improved from 669 crores to 1341 crores from fy 16 to fy 19. i.e within four years. And during that time, topline of company as a whole has improved from 2600 odd crores to 3400 crores. And during q2 fy 20, garment manufacturing contributed 40% to total revenues. Since March 2018 quarter, this company has shown good growth in its y-on-y operating profits till date. Revenue has grown at a sedate pace and often remained flat but profits have grown. And this kind of company is available at PE of close to 12 based on expected FY 20 numbers. Promoter reputation feedback I have got is top notch. Technically its made a double bottom breakout above 650 and now there seems to be some life in stock price.
Another example is frontier springs. Orderbook wise it is well placed and the numbers reported are also very good. Stock price has run up from 160 levels to current 240 levels but valuation wise still below 10 PE based on expected fy 20 numbers. I dont own it but it has remained on my watchlist since a long time.
Another example is APL Apollo. It has run up since past few months in sync with its results and those who got in around 1250-1400 when a bottom looked to have been made and who did digging on the company and developed conviction have been rewarded.
Yet more examples JB Chemicals , Laurus Labs etc. One needs to do thorough digging before taking a significant position but if we get the call right, returns can be satisfying.
These are the kind of companies I feel would generate good returns going ahead.
disc: from above names, I am invested in jb chem, apl apollo, kpr mills, laurus labs. No position in frontier springs.
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