stocks on my radar when the valuations are attractive are:
Symphony
GRUH finance
Kitex
Astral Polytech
Mayur Uniquoters
Poddar developers / Ashiana Housing
Cera/ Kajaria
Oberoi Realty
Can Fin Homes
Essel Propack
Nucleus Software
I am planning to keep 15 stocks in my portfolio and stick to the ‘buy and hold forever’ strategy unless there are some drastic changes in the fundamentals of the business. Any feedback or suggestions are welcome as I am still learning
I like the way your portfolio is structured currently. And by structured i am not referring to the stocks in your portfolio. I’m rather referring to the concentrated structure of your portfolio. On a personal level I prefer maximum 5 stocks in my portfolio.
I would like to understand why you are still invested in Garware or Noida toll bridge. The growth is definitely slowing down in those two. I can see better candidates in your portfolio only, where the funds can be reallocated.
Other than that, you own some good businesses. So, I believe you know what you are doing.
Hi nikhil,
Thanks for taking out the time and giving me the feedback.
I prefer a concentrated portfolio and like to stick to my areas of competence - Real estate, Banking, Manufacturing or any business that I can understand.
Let me explain why I invested in Noida and Garware:
Noida toll bridge - Wide locational moat, Low debt, high dividend yield, limited downside, inflation-adjusted recurring cashflows, This is more of a low risk, low reward stock for me and the bonus is the high dividend yield. I am not extremely convinced about the growth prospects of the company as well.
Garware Wall rope - Industry Leader in a ‘niche’ business segment, Innovative company, Spends on R&D, Have a few patents, High promoter holding, negligible debt, 3 decades of expertise, ethical management, good capital allocation skills, cash rich balance sheet. I also believe that by being present in select value added segments, Garware has carved out a profitable and growing niche in an otherwise commoditized space.
A reasonable valuation and healthy signs on sustained earnings growth gives me the confidence that stock carries limited downside and a promise of good upside over next 3-4 years
Also you can suggest better candidates for me to consider as well. Your feedback is highly appreciated
Barring noida toll bridge which has proven itself to be a value trap till now, most other picks have sound logic. Noida tollbridge may not have much downside but then it also has very limited upside unless they pull out a magical wand from somewhere.
Hi hitesh,
Thanks for the feedback. Yes i do agree it is a value trap. I am looking to replace it with a high quality and high growth business which has a limited downside and an unlimited upside
Looking for limited downside is a must quality for any investment and it is admirable about your approach.
But, what’s the point of investment in stocks if there is no growth visibility. One would be much better off investing in real estate.
In case of Garware wall ropes, while I like the business due to its niche segment, sales growth has been slowing down in last few quarters. I haven’t really kept in touch with Garware lately but numbers aren’t encouraging neither I can foresee any big growth triggers.
On another note, there are many good businesses being discussed on VP. Personally, KTIL is my top holding (hence I am biased). You can always check the KTIL thread out to understand the business and see if it is up to your liking.
