Kunal Jain - Portfolio Journal

Q&A: Questions & Answers Portfolio Q&A
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I am starting this thread as a long-term investment journal to document my thinking, research process, portfolio decisions, and learnings over time.

I was introduced to equity investing at a young age through my father, a long-term market participant for over two decades. Over the years, I have been investing my own capital with a strong focus on fundamental analysis, valuation, and portfolio construction.

The purpose of this thread is not to share stock tips, but to create a time-stamped record of my investment theses, portfolio actions, successes, mistakes, and evolution as an investor.

For every investment I make, I plan to document:

  • Business understanding and thesis

  • Valuation reasoning

  • Key risks

  • Expected holding period

  • Conditions under which I would exit

  • Periodic updates on how the thesis is playing out

I believe that disciplined documentation and review are essential for improving as an investor, and I hope this thread will help me stay accountable to my process while also learning from the ValuePickr community.

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Post 2# - Portfolio Construction Framework – Direct Equity Allocation

Hello everyone,

In this post, I would like to outline how I think about portfolio construction before discussing individual stock ideas. I would genuinely appreciate feedback from members on how this framework can be improved.

Disclaimer: My overall allocation will also include- 10% in Gold/Silver, 10% in FDs for liquidity, index funds (Nifty 50/Next 50/Midcap), and some international exposure. This post focuses only on the direct equity portion.

Background

I have been investing for the past 5 years through direct stock picking. However, I did not consciously diversify across sectors or market caps, which led to certain stocks becoming disproportionately large.

This made me realize the importance of a structured allocation framework.

Time Horizon, Risk, and Objective

  • Long-term horizon, no urgent liquidity need

  • Moderate risk appetite

  • Objective: Diversified and disciplined portfolio construction

Sector Framework

I broadly diversify across:

Financials, IT, Consumer (FMCG & Discretionary), Industrials & Capital Goods, Healthcare, Materials, Energy & Utilities.

Within these sectors, I also try to avoid clustering in the same sub-segment. For example:

  • In Financials: mix of banks, NBFCs, insurance, and other financial services

  • In Healthcare: exposure across hospitals, pharma, etc.

  • In Consumer: mix of FMCG, discretionary, and related areas such as real estate where relevant

This helps reduce concentration within a sector itself.

Market Cap & Position Approach

Within sectors, I aim to hold a mix of:

  • Large cap

  • Mid cap

  • Small cap

with equal initial allocation. I target ~20–21 stocks in total.

I also try to keep 10% cash within the direct equity portion for tactical opportunities or special situations, though most of the times i am not divested because of FOMO and not liking money idle, but have faced and also learnt it that money not invested is also an investment which tests patience but gives good return as you have money to invest when eveyone is already invested and cannot buy at low :)

Flexibility Based on Opportunity and Conviction

This framework is a guide, not a rulebook as i belive investment is more of an/a art/craft rather science :)

  • In some sectors, I was not able find suitable stocks across all market caps and am comfortable holding fewer positions.

  • In sectors where my conviction is higher, I may hold more than three stocks.

Stock quality and conviction will always take precedence over maintaining symmetry.

Rebalancing

I plan to review and rebalance the portfolio once every six months, as I believe a quarter is often too short for theses to play out, but still will keep a look on overall portfolio on month on month basis as well but for each specifc stock it will be 6 months.

I would appreciate suggestions from the community on how this framework can be made more robust, thank you !! :)

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Hello Kya meri apase bat ho sakati he ?

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Sure we can DM :slight_smile: if it is not topic related, otherwise we can discuss here as well.

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Post 3# Great Eastern Shipping: Cyclical Earnings, Asset Value & Capital Allocation Optionality

This is the 3rd post in my Valupickr series on Great Eastern Shipping, part of my model portfolio coverage.
Over time, I plan to build similar thesis notes for all companies in the portfolio.

This is not a simple “cheap stock” story.
It is a cycle-driven business where timing matters more than static valuation multiples.

1. Business Model in Simple Terms

Great Eastern Shipping’s earnings are driven by a few key variables:

  • Freight rates - main earnings driver, highly cyclical

  • Spot vs time charter mix - volatility vs stability

  • TCY (earnings per ship per day) - real earning power

  • Utilisation - idle ships directly reduce earnings

  • Vessel supply cycle - slow adjustment, drives boom-bust cycles

This makes shipping a highly macro-sensitive cyclical business

2. Where We Are in the Cycle

  • Freight rates remain relatively strong

  • Utilisation is healthy

  • Earnings are above long-term averages, but below peak-cycle levels

Overall, the industry appears to be in a mid-to-strong cycle phase, not extreme conditions.

3. Valuation: Asset (NAV) is the Anchor

  • Consolidated NAV: ~â‚ą1,540–1,590/share

  • Standalone NAV: ~â‚ą1,230/share

Historically, the stock has traded at a discount to NAV.

So valuation is better understood through an asset-backed lens rather than pure multiples

4. Earnings Sensitivity (Cycle Impact)

  • Pre-2022 EBITDA: â‚ą1,200–1,700 Cr

  • Recent EBITDA: â‚ą2,600–3,100 Cr

Scenario range:

  • Base: ~â‚ą920–1,030

  • Bull: ~â‚ą1,140–1,370

  • Peak: ~â‚ą1,600–2,000+

Shipping is a high operating leverage business to freight cycles

5. Capital Allocation Optionality

  • Cash: ~â‚ą6,500 Cr

  • Current return: ~3%

Management views this as dry powder for downturn deployment into assets

If deployed at higher-cycle returns (10%+), it could add meaningful incremental earnings over time.

This makes capital allocation a key hidden value driver

Final Takeaway

Great Eastern Shipping is best understood as:

A cyclical earnings business anchored by asset value, where long-term returns depend on cycle positioning and capital allocation discipline.

At current levels, the key question is not just valuation—but:

Where are we in the cycle - is the earlier bull cycle now the base for shipping because of limited supply and geopolitical tension, and how effectively is capital being deployed across it to utilise the opportunity to the fullest.