KAPIL Portfolio

Q&A: Questions & Answers Portfolio Q&A
21

There could be a simple solution to deal with the INVESTING vs TRADING problem.

One can open an investment account where no tomfoolery is allowed. Strictly investment mode.

And in another family member’s name a trading account can be opened and all fun and games can be had there.

What proportion of capital is to be allocated to each account is one’s own call but the mindset for the two has to be totally pre fixed.

And at 32, you have not wasted 9 years. You have gained valuable experience and learnt some important lessons. Time is on your side, I remember at 32 I didnt have any money to invest. :grinning:

17 Likes
22

Thanks a lot for the Encouragement Hitesh Sir.

I really need to get Disciplined and Gain More Knowledge.
I have decided to be in the Market for a long Haul (For the Rest of my Life).
Will keep on reading here and learn.

Thanks a Lot.

Regards,
Kapil

23

FORCE Motors Crossed 3300 today was looking to get into it since 1900.
Did not had faith in myself to invest in it was looking for confirmations.
Lesson learnt :frowning: the hard way.
Time to move on with this one more learning.

Regards,
Kapil

24

Bought some LLoyd Electric today at 218 roughly 2% of Portfolio.

Their debt has been on an increasing trend but it seems that because they are currently in growth and expansion mode.

Also value of their Other Assets have been increasing.
Can any Senior Guide what all comes under Other Assets.
Is it possible that they are using this debt to buy offices/outlets or setting up franchises for pushing their
Consumer goods.

Was Just Comparing its Market Cap and Profit figures with that of Blue Star and found that it reports more operating profit than Blue STAR.

However could not understand that it is a consumer Goods company reporting regular profits how come
its operating Cashflow is negative. (If any senior can provide insight into this).

Have Checked online Sites as Diwali Time is approaching and Saw their ACs and Washing Machines on Amazon and Flipkart

Will keep track of their numbers if in one or two quaters indication of debt reduction or improving cashflows are seen than will add more else will get Out

Seniors and Fellow Mwmbers Views are invited.

Regards,
Kapil

25

Took tracking position in Intellect Design Arena at 220.

Some brilliant analysis is done on this forum by the members really thankful to them.

Being myself fro the IT and having BFSI experience i really liked the posts of @hrishikesh .

Although right now took tracking position only because of Cash Crunch.

Other Stocks on Watch List are : Kansai Nerolac and Asian Granito

Regards,
Kapil

26

Wishing all VP members a very Happy, Prosperous and Joyful New Year.

This forum really encourages its new members to learn the art.

I am really thankful to seniors as after joining this forum i think my investing temperament and decision making has improved a bit. (There is huge huge scope as well as need for improvement though).

@hitesh2710 Sir you stock picking skills and humility are unmatched and really want to thank you
for the below lines

"And at 32, you have not wasted 9 years. You have gained valuable experience and learnt some important lessons. Time is on your side, I remember at 32 I didnt have any money to invest. "

you posted on my portfolio thread on Aug 19.

Will try to learn more and more and i have dream of sharing my knowledge here at VP.

Once again want to thank all the senior members from the bottom of my heart.

Discovering VP goes as one of my achievement for 2015.

Regards,
Kapil

2 Likes
27

Portfolio snapshot

PHARMA (40%)

AJANTA PHARMA
CADILA HEALTHCARE
GRANULES
SHILPAMED
SYNGENE
TORRENT PHARMA

HOUSING FOR ALL THEME (4%)

CERA
KAJARIA
HAVELLS

HFC (32%)

GRUH
REPCO

AUTO and CV Cycle recovery Theme (10%)

AMARA RAJA BATTERIES
JAMNA AUTO
MINDA INDUSTRIES

AGROCHEMICALS and CSM (14%)

PI Industries

I have done quite a bit of rejigs in this market fall and bascically preparing my portfolio for next 3 years.
Structuring the Portfolio to have a part of it in the major sectors which seems will have good growth if the India story unfolds.
In this market fall I have got in and out of LLOYD ELECTRIC and ENGINEERING (at a loss after I was sitting on profit), Intellect Design Arena (No profit No Loss), CCL Products (Loss)

The reason for my exit were

LLOYD : Bad numbers also going by the theme by What you See I am not fully convinced.
Although in their previous quarter presentation they have depicted that they are growing in all the segments but the space that they are operating in seems very crowded.

Intellect Design Arena: Although I am in IT field but not able to follow it completely.

CCL Products:

Flat numbers will wait for it to show some growth or increased market visibility.

In my Portfolio restructuring excercise and in this market downfall I have realised that It will be easy for an investor like me to first concentrate on 12-15 % returns for first 3 years and increase my knowledge in that process also it is easy for me to follow the established brands (that are at the top in their field) and as per Market Cap they have scope to Grow (Havells, Amara Raja, Cera and Kajaria).

In Pharma Space I am taking this forum help plus reading the Annual Reports of the companies .
Tremendous work done in this forum has really helped me to select few pharma companies to invest in.

Some Companies that interest me are :

Dr Lal Path Labs

Reason: Great Visibility they have in northern region.Thie Hub and Spoke model mentioned in their RHP (They operate these on a revenue sharing model ) really make them asset light.
I will try to do SIP in it if at all it corrects a Bit.

NEROLAC PAINTS.

I have decided to keep a horizon of around 20 Stocks for my learning and Investing purpose and as my learning increases will move towards concentration.

Seniors and Fellow Members Comments are most welcome

Regards,
Kapil Gupta

28

One More thing I have learned that people like me who are still learning this art one of the most important thing is to be in peace with yourself.
Follow the Market with Passion but don’t let the notional loss affect you negatively this will really help you in taking rational decision.
Love your family decide a realistic target for yourself dont run after multibaggers but look for companies that have the potential to grow at a decent pace.
Look at the suffering around you and try to be instrumental to reduce it.

Happy Investing !!!

Regards,
Kapil Gupta

1 Like
29

Hi,

I have been reading investing book off late to increase my understanding regarding the market.

I have one very basic question for the Senior members (Please spare some time to give valuable views)

As per Lynch " Always avoid hot stocks in hot sectors"

however also read below line at quite a lot
"Invest in Sectors having Strong Tailwinds and the stock should be sector leader"

Are not the two statements contradictory?

The best possible Answer I could think off is

In a bull market there are certain sectors that lead the bull run so these are the sectors with a strong tailwind however as we approach near the end of bull run there is such a euphoria created in these sectors that they become the hot sectors and one should get out of them.

Now my above answer is very good only if i had to give a theoritical explanation i want to fit it in understand with a practical example and thats where i need the help of seniors.

Example at present there is a lot of talk about HFC companies

Now some people will say that since there is a lot of hype created around the HFC’s so one should not invest in it as it happens near the peak.

However if we look at the numbers delivered by HFC’s there are no signs of slow down and also they are not quoting at exobirant valuations.

Also personally i believe (thats the reason i am investing in market) that it is not the end of bull run India.

So I am a bit confused and would need seniors to please guide.

Regards,
kapil

30

Strong tailwinds - Stocks that have a favourable economic climate to support its earnings and visibility of growth in the near future.

Hot stocks - Evident disconnect between fundamentals and stock price. Stocks flying on the flavour of the season and not based on its earnings…examples: tech stocks in 2000’s, real estate stocks 2007’s.

As long as stock price, reasonably matches true cash earnings , we should do OK. Sticking to analyzing earnings numbers, rather than price will give you more clarity.

To invest or not to invest in high PE sector leaders , is a decision you should take. My personal take is, if the sector leader can sustain earnings over long periods(10-15yrs), I will hold or buy in SIPs.

Disc - I am in learning phase too.

2 Likes
31

I must say you have an impressive portfolio, though I do not know much about Jamna, Minda. However, the 4% in Cera etc theme will not move the needle much unless you want to increase this allocation. It makes sense to move this to Auto recovery theme, just a thought? Otherwise, you would do well overall. Good to see a new investor having the stomach to book loss in a stock after being in profit by following a process in inesting. Keep learning!

Regarding your other question, if hype is backed by earnings and if there is not much disconnect between earnings vs. valuations vs. future expected growth and if these earnings are predictable, sustainable, then I do not want to know if it is a hot sector or cool sector. All I want to know is where are my earnings? After my family, I love earnings.

32

Thanks a lot @Lynchfan and @richdreamz for providing your valuable feedbacks and explanations.

Yes, i do have inclination towards increasing the exposure in Housing for all theme with increasing the exposure to already listed 3 stocks plus kansai Nerolac.

I want to initially keep a bit diversified portfolio of around 20 stocks as i think if i look it sector wise it comes down 4-5 sectors.
I am following a approcah where i shortlist the sector than pick 3-4 best performing companies from that sector.

Regards,
Kapil

33

Hi All,

Portfolio snapshot

PHARMA (38%)

AJANTA PHARMA
GRANULES
SHILPAMED
SYNGENE
TORRENT PHARMA
ALEMBIC PHARMA

HOUSING FOR ALL THEME (8%)

CERA
KAJARIA
HAVELLS
KANSAI NEROLAC

HFC (32%)

GRUH
REPCO

AUTO and CV Cycle recovery Theme (10%)

BAJAJ AUTO
JAMNA AUTO
MINDA INDUSTRIES

FMCG(12%)

BRITANNIA
GODREJ CONSUMER
JYOTHY LAboratories

Have been managing my portfolio on my own now since a year and quite satisfied with my progress.

Have been an avid reader of @hitesh2710, @Donald and @ranvir and @basumallick and all the seniors thread really helped me in getting into a continuous learning process.

SUCCESS in LAST ONE YEAR:

Invested on my own conviction after reading Annual reports and AR’s and understanding the sector theme:

Jamna Auto
Cera SanitaryWare
Kajaria Ceramics
Kansai Nerolac
Havells

FAILURES

Getting out of PI industries at the wrong time
Booked a loss in CADILA (Although i wanted to still hold on to it needed cash for some urgency)

Thanks and Regards,
Kapil Gupta

1 Like