‘Namasthe’ to all leaders of forum, Donald, Hitesh, Ayush and many others
I am new to this Forum and also relatively new to investing in Equities. I am very late, as I am 37 now and decided to start building portfolio for long term. I recently came across this Forum and it took me by surprise to see the standards/ expertise of members on equities. With Lot of hope I am writing this, I indeed need to kick start my investing asap.
I am not an expert and learning, Hence I request you all Seniors to Suggest 3-4 of your high conviction scrips, at current Price, which could grow in future. If I can get a list of 20 scrips out of your suggestions, then I can start researching on each stock and finalize few of them. I do not have a skill at the moment, to short list 10 stocks out of hundreds of good stocks available. Also price for most of the good scrips is high, confusing me a lot to shorlist myself. It would be a great great help , If I can get few names from each one of you for current Market situation.
Few Stocks I am thinking are:- Astral Poly, Mayur Uniquoters, Dhanuka Agritech, Ambika Cotton, Ramco Systems, United Spirits, Shilpa Medicare, Chaman Lal Seti, IL & FS Engg, Pantaloon Fashion, Nilkamal, RSSoft. Yet to develop conviction on these as of now. I am learning slowly.
I am a decade late but want to cover up the lost time. I am by nature fairly aggressive investor.
@ayushmit, @Donald, TED, and many other experts in this forum:
I am exactly in the same state as @ds101. Am starting up fresh, and want to build a portfolio for long term. Want to have a mix of good turnaround companies + stable compounders. Can you please suggest few picks for newcomers like us. Of course, we will not violate SEBI guidelines as these picks are just idea sharing and not a buy recommendation. Ayush’s GOA presentation is excellent and I am sure there are dozen other picks currently in cooking which will make the news next year. Want to research and participate on them before it is too late.
I would suggest not to build portfolio on borrowed conviction. How high the conviction may be. You can start reading materials, understand the market and other preliminary fundamentals. Then can ask for help. Believe me it will work. If you try to make up your lost time by building portfolio on others conviction you will never have time for building your own conviction. I have experienced it firsthand. Hope it helps.
Thanks for the reply.
I am not a novice in equities, but not an expert as well, as of now. I can read ARs, can get a fair idea about a stock using other tools like screener, BSE site, moneycontrol kind of sites and I am still learning.
My request is that, instead of me finalising few stocks out of 100s of ‘Good’ stocks, I want to have few of your bets, for ‘todays scenario’, So that I can really research further and finalize the list myself and develop my opinion on them. I can come back to you all with my analysis, my final list for your comments later.
Hope I am making sense here
Unfortunately I couldn’t spend long hours, as I work as a Director in a small IT firm in Hyderabad. I am hoping for little help from you guys .
Waiting for replies
I am also just started to follow path :), and from the above list
Ambika Cotton PE12
IL & FS Engg – PE18
Nilkamal - PE 17
I thing are still available at good valuation
Disc: started investing into above in SIP mode a with small amount through my savings
I shortlisted few companies for myself and in the process of building conviction and finalizing few stocks from the list.
Disc: I have invested in only few of above companies
Since you are a new investor…identify debt free companies to begin with where you have some clarity that the next 2-3 years EPS should grow by 18-20%.
Another rule of thumb to make big bucks…PE should be lower than EPS Growth.
Thanks for sharing your list @mmvravindra. Much appreciated. Will go through the list and read more on each of these.
Hi guys, i usually follow try to answer three questions before i buy the share.
- Do i understand the industry or the business functions?
- Does the company have an able-ethical management team?
- can the company achieve sustainable growth with its products or services?
if all the above is a yes, then i start digging into the fundamentals.
Hi Ravindra -
Can’t comment on most others, but would advise you to avoid Amtek Group (Ahmednagar Forgings). The group is currently on SMA2 by many banks (High risk of defaulting on debt commitments).
My first quick tip : " Understand about businesses "
For Ex :
Why pharma is a better biz then steel ?
How brand affect biz ?
Basic law of economics.
My second Tip :
Open this site and digest as much as you can.
My third Tip :
Build your portfolio slowly.
Hi dear, thanks for kind advice. Yes, Ahmednagar should be avoided. Earlier had a small position in it, but after came to know about the situation of the company exited with minor losses.
You need to identify the returns that you are looking for. Some of the companies that you have identified are good but the issue is most of them are overvalued or just recently went through huge upside. So if you are expecting similar returns in near future, you may get disappointed. I would advice you to identify what kind of investor (risk / reward, how many years you can hold etc) you are and then start with 4-5 companies. Once you get the handle of it, then you can start allocating more and may identify 4-5 more stocks. Anything below 10-12 would be manageable.
I quite like your approach. The list should be a good starting point in short listing potential investment candidates.
Next step should be to weed out unattractive ideas and sectors and then take if further down to looking up the more attractive ones in details wrt business quality, valuations, potential returns from hereon etc.
Thanks a lot for the replies !!
@whipsaw : you are absolutely right ! This is where I am hesitating and confused.
Most of the good scrips which have been discussed here were very good stocks, 1year or 2 years back. Those who are already in 3X/4X , will have different conviction about them, now. I would have a different view, as the valuations are not at all cheap.
So with my skillset, I thought of taking some queues from fellow boarders and then work it out with my final list by developing my own conviction.
Thanks for suggesting the approach as well.
Please share any more of your views.
Look for high ROE and low debt companies with moderate dividend paying companies from above list. Invest preferably in Pharma, Consumer, Financial & lT stocks if you are a beginner. Avoid infra and commodity stocks.
Most of the points have been covered and great advice given by experts.
just wanna add, pls look into importance of cash flow (Both operating and free cash flows) and zoom them while analysing cos.
How cos are managing cash flows says a lot about management.
Then again focus on working capital management and look for businesses having low W/C requirement, so that money stuck up in Receivables and inventory isn’t too much. Management efficiency is reflected well in it.
Finally go for business you understand and their ARs makes sense to you.
Even if you dont get multibaggers through this way, surely you will be on the path of steady compounders
trying to cover up on lost time is not the right way to go about it.instead think of compounding your capital at 20-25% cagr.even at 22% your capital will double in 3.7yrs so you can do the math till you reach say 60yrs of age.growth with respect to valuations is what matters the most ,avoid the fastest moving stocks,stocks that have doubled in a few months or weeks.your list does have some long term compounders ,invest in those and allocate capital in those so that you sleep well at night.
allocate capital proportionately ,reasonably diversified so that you sleep well at night
I am a beginner . Can please assist me in explaining in simple terms what does PE < EPS signify.
Thanks in advance.