hello hitesh ji,
wonderful hearing you from all time time
Whats your view on SRF ?
I donāt follow aarti drugs so not much idea about its fundamentals in details. Last quarter results seemed to meet with market expectations and there was a bounce in stock price. Its interesting to note that a bulk drug company like aarti drugs was given PE of 40 during the sectoral bull run sometime in October 2020. Stock price had run from around 100 levels in Covid lows in March 2020 to 1000 levels in October 2020, 10 times in a matter of 10 months.
Once these kind of moves happen and stock undergoes deep correction, it takes a long long time to recover. Usually smart money is early to exit, say around 900-1000 kind of levelsā¦ And once stock starts correcting, some folks (read naive investors) buy assuming its a routine correction, and keep averaging till some time. On further fall those who are in profits start unloading which leads to further correction. All this while the naive investors keep holding their shares, hoping to see their price back again, which does not happen and stock price keeps sliding. Once the whole fall is done , stock price goes into a consolidation phase, often lasting few months to few years and a lot of frustrated investors get out on each rally. Once the last seller is out, real meaningful rally starts. This whole process usually takes 3-5 years or often more.
About buyback, its a bit surprising that a company with net debt is going ahead with buyback.
Technically, post results stock price gapped up and left behind a huge gap between 518-555 and went on to hit a high of 645 and today closed at 582. Above mentioned gap needs to be kept in mind to observe for any support.
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Chemical sector rally was a sectoral rally mainly fuelled by shortages and some other company and sector specific factors . The sectoral rally topped out in early 2022, say Jan to April 2022. The fancy was so strong that it made investors believe that the demand environment was going to remain strong for ever. Some managements also went crazy and went in for crazy capexes especially at the peak of the cycle. And while the rally fizzled out, it has not fizzled out of the minds of retail investors. 
Even now after nearly 12-18 months of the sector peaking out. Many stocks still keep posting fresh swing lows.
I read about a lot of so called experts forecasting that worst will be over in next 2-3 quarters, and I have been hearing this since past 3-4 quarters, and the timelines keep getting extended.
Regarding your query about how investors should prepare for expected turnaround in the sector, the first thing they should do is look at other sectors where money is waiting to be made.
It could be a future opportunity, but we are not sure about the time line. How far in the future is the rainbow for chemical sector going to re appear. Few months, few quarters, few years? Its anybodyās guess.
I think we as investors need to learn from history related to sectoral fancies. When these fancies start and reach their bubble territory, most investors get carried away by the narrative, and start feeling that these tailwinds are going to last for ever. At peak of the cycle, what we see is peak sales, peak margins, peak profits, and peak valuations. For all these factors to re align together again will take many years most of the times. There will be the ocassional bounces within the sector and stocks, but making big money is difficult in these names. And all this while, other sectors which are in fancy keep churning out big quick winners. We have seen that happen in defence and railway stocks of late. Once this fancy fades, who knows something else will take its place.
Problem with retail investors is that they are afflicted by recency bias. Sector that has created lot of wealth in recent past ( even if the sector has lost its fancy) keeps popping up in the minds of retail investors and they keep looking out for reasons to invest in the sector. And while their energies are focussed on these kind of sectors, they entirely miss the next big sector. And the cycle goes on.
@hitusohi1 I donāt track SRF but you can read above hypothesis and a lot of it will apply to SRF too. Though it remains one of the better companies in the chemical sector.
@arjunbadola I am not a mutual fund investor and have not looked at any funds in past many years. So I am not the right person to answer your query.
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Hitesh Sir, can commodity stocks be a part of long term core portfolioā¦many metallic commodity stocks ( steel, aluminium, industrial metals etc ) have given multifold returns of lateā¦your views on this piece especially if one wants to make them a part of their core portfolio for long termā¦
I suggest you read Peter Lynchās book One Up on Wall Street if you have not read it. And if you have read it, you need to read it again. Especially Chapter 7. Then you will be able to make out the futility of owning commodity stocks in core portfolio.
You can even read my earlier post on chemical sector, which again is commodity sector and the answer is there too.
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Sir
Your thoughts on current railway sector stocks
Is cycle came to topā¦ and how we can notice when is the top?
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Railways is the sector currently in favour in the markets. And this has been going on since past few months. Many stocks in the sector have doubled tripled or more. Some are in the process.
Usually these sectoral fancies take stocks to stratospheric valuations, so as of now its difficult to make out whether its near top.
Investors who want to join the party mid way should have an eye on the exit door. Idea should be to not get carried away by momentum and start believing that these things will last for ever. Trees cannot grow to sky.
As of now things seem to be in momentum, and some stocks like HBL (one I own and track, there will be many others ) keep showing strong momentum.
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Hi Hiteshbhai,
Hats off. Excellent analysis. I am also holding one such stock ( Jubilant Ingrevia) bought at a higher level after reading an excellent analysis 
of a so called market expert in the previous bull run. The other day a well known and a very successful investor gave an excellent idea - when you have such a pap( sin) of a bull market, donāt sale it now at a considerable loss, but advised everyone to wait for next bull run for the overall market, when all share prices will go up and sale at a price 10-15% from your purchase price. I am waiting for that. 
Whatās your advise? Samir Ghosh.
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Hi Hitesh sir
Just noticed little bit volume and upmove in transportation stocksā¦
With lot of PLi scheme companies and allās new manufacturing theme are coming upā¦ can we treat transportation will be like railways and defense sectors
Just enlighten me ā¦ if my thoughts are not correct
I donāt think ingravia works in generic chemicals
Most of their stuff is specialty
I hope things will settle in upcoming qtrsā¦ I may be wrong also
Hi Sir, You used to track arrow greentech at one point of time. Can you please share your views. Thanks
First you have to enlighten me on what you mean by transportation stocks. 
.
And what is the PLI scheme for the sector and how the sector benefitsā¦
Maybe then we can take the discussion forward.
@ankur_17 I donāt know how long ago I used to track Arrow greenā¦ Havenāt come across the name or mentioned the name in last many years.
We are in a bull market, so anything flies. Doesnāt mean we have to track/own these names.
One thing I have done over last few years is to narrow down the universe of companies I am tracking. Wherever I find something interesting and actionable (either based on technicals or fundamentas, or techno funda) , I try to discuss.
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Hello Sir,
Having question for two stocks.
Gujarat Fluorochemicals Ltd: Few months back it reached to 2500 levels and given rally to 3400. You have mentioned that time results are decent and I made some profit out of it. Now it again downwards journey and I am keep adding every 100 Rs. gap. But seeing your 1 day before thread on chemical sector want to check your view on GFL?
JK Paper: available with 4+ PE where industry PE near by 16+. Also given decent Q1 result but not moving as per expectation. Any comment on JK Paper or Paper industry?
Thanks & Regards
Hi Hitesh Sir.
Need to know your view on the cable/wire players like Polycab and Kei industries on charts. Though the tailwinds for the industries are there, yet, most of that has already been built into the price fundamentally.
Hi Sir,
just my two cents: I mean stocks like GATI, TCIā¦Logistics sector
As PLI scheme is there for many manufacture sectorsā¦how goods will transport once manufacturing is doneā¦that where I feel lot of scope for tranport companiesā¦
Two in depth thread related to Guj Fluoro have been started on VP, one a domain expert thread and one related to views shared by a company expert. A lot of ground related to GFL and its prospects has been covered in these threads. You can go through these threads and take an informed choice.
I donāt track JK paper.
@axiskumar Logistics sector has its own set of variables which one needs to understand before taking a call on the companies. I suggest you read Pat Dorseyās Five rules for successful investing wherein he covers each and every sector in detail and discusses which factors to consider while evaulating investment in the sector. And its not as if PLI scheme is going to change fortunes of a lot of companies drastically. We have to find out which companies benefit specifically and then take a call.
@Naresh Polycab has had a strong run up from levels of 3800 to 4900 in last few weeks and is taking a pause. It remains in a strong uptrend, but while riding these kind of moves, one needs to be careful about following appropriate stop losses. KEI has been in a strong uptrend ever since it rallied post Covid. This week on weekly candle it formed a bearish engulfing candlestick and hence one needs to take that into account. I donāt follow any of the two companies specifically, so do not hold any views related to them.
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Hitesh sir, any views on wind sector stocks: Inox wind, Suzlon? Sector is witnessing a turnaround after 7-8 years of underperformance and looks like these stocks are quite underowned
Thanks
Dear sir, have you ever tried stock derivatives? You are very knowledgeable and very experienced, and you are also up to date regarding the changing of market fancies, and always mention about the rotation in sectors, being in where the action is, and not where the actions has happened.
With shorting, you can also participate in the fall of the underlying along with its rise. With index it is relatively easy, but with stocks, particularly when they are falling, to predict is difficult. But for you, I believe it is not difficult, both for uptrending and downtrending stocks, as your sword is sharp on both the sides, fundamental and technical. So you can gauge.
So have you tried doing any derivative participation in stocks. I am asking this because of the payoff one can have if one knows about both the business and the price movement, which you do. Even if you did not participate, I am guessing this thought must have crossed your mind for sure. If you have not, please share the reasons.
Would like to know about your general thoughts as well regarding the FnO segment, are they a step in the natural evolution of a market participant, or are they a different beast and as such it is hard to do even for seasoned investors, or are they like WMD like Buffett said etc etc.
Thank you very much for enlightening us all with your knowledge and wisdom. And if ChatGPT searches the web for answers for specific questions, I am sure it will search this thread, as this thread has covered thousands of questions from members about thousands of topics, or perhaps this thread is the ChatGPT of VP.
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Kaveri Seeds: Use to hold kaveri seeds in 2019-2020. They were big in cotton related products. But somehow the performance did not seem convincing. Exited completly in 2021 June. The management, in 2019, told that they would be shifting their high dependence on the cotton for the revenues.
Both Inox Wind and Suzlon recently crossed their respective 6 and 5 year highs and have since shown good strength. As you mention, the sector is attracting investor interest and seems to be worth digging. I have not managed to do any fundamental digging into these names, but charts seem interesting for both Suzlon and Inox Wind. As of now I have no positions in any of the names, but like the chart of Inox wind slightly better.
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