Since my portfolio holds a lot of stocks, I wanted to share only the top 10-12 stocks (in no particular order) that I hold in my portfolio for your comments and inputs. They are mostly compounders and I am generally happy with these.
Guj Fluorochem
ICICI Bank
Page Industries
Elecon Engg
Karur Vysya Bank
RHI Magnesita
Shaily Engg
Kennametal
Rolex Rings
Varun Beverages
JB Chem
12 Escorts
In this only KVB is a new entry over the last 2-3 months. Rest are held for longer timeframe. There are specific threads for each of these at Valuepickr and hence not detailing the thesis.
Look forward to your inputs.
Regards,
Nikhil
Disc: This is not a recommendation. This post is only for learning and discussion purpose. I am obviously having vested interest in each of these stocks so take everything I say with a bag of salt.
HiâŚYour intentions are good. But now a days, many people prefer direct investment in mutual.funds instead of distributor. Also many people prefer index funds instead of active funds .
Is this a push or pull business or rather do you pursue it in the traditional way (push is what I have seen) or have developed your own methodology? Do you employ agents to do the push work also?
It is indeed good to know that you found and doing work in an area you likeâŚ
@Mudit.Kushalvardhan,
Your point is right. However market is very big. All you need for succeeding as an MFD is 500 families or 1000 individuals you can work with you through different phases of their wealth creation cycle. Also there are many people who need hand-holding and personal touch @Investor_No_1
I believe wherever money is involved, it is always a better strategy to let the good word spread and people come to you rather than you pushing anything. However as I said, I am not too focused on the MFD business right now so I donât need any other person to sell the products for me.
Your journey was very interesting to read, Nikhil. I wish you all the best.
I am curious to learn more from you and had 3 questions:
You mentioned that you arenât good at Value investing. Does that mean you would buy stocks like Kennametal/Rolex at PE>50?
Continuing the same question, would you rather exit a stock if the valuation becomes high irrespective of it being a growth stock? For example: letâs assume, if in a few days Kenna/Rolex Rings have PE > 70
How do you keep track of all the information? I usually maintain one excel sheet for one stock but this becomes cluttered after 6 months.
Is there any PMS/Fund house whose holdings you track/like? âŚand why?
@ChotuKatappa - Thanks for reading. I will try to respond to your queries
I am not good at value investing does not mean that I donât love value. Infact I would classify myself more as a âGARPâ investor. However reasonable value with Strong business model and Cyclical upswing/ business momentum is required to make the cut. While I dont mind buying high PE stocks, generally I donât build aggressive positions in those. I am more comfortable with good stocks at reasonable valuations. Both Rolex and Kennametal were purchased at much lower prices. I did add some quantities during the rise but it was hardly 5-10% of my initial purchases.
I may trim my positions if the stock and business (especially cyclical) valuations become very high. However it also depends on the continuous quarterly updates coming in and the stock once expensive can become cheaper and hence may become at least a hold again. Generally I donât exit any performing stock completely unless the price action/results change substantially, given that market is giving them the valuations. Specifically for Rolex/Kennametal, I did trim some positions but the market action suggest that they have more way to go, especially with the way the bearing guys are moving up again.
I try to keep track of more than 100+ stocks. So excel sheets are no good. It will take full day and more to update data only from one place to another . I manage through screener for any significant announcements, price action and a broad understanding of the business. As you can imagine I cannot do very detailed studies of the stocks with so many stocks to cover. So my idea is to get a good sense of the business and results and then buy/hold till price action is confirming the view.
I try to read most of what becomes available in public domain on reports/changes etc. If the new reco is not in âtoo difficultâ bucket, then I atleast look at broad data and latest annual report/concall and then take a call. Most of the MFâs are generally quite slow in moving to new ideas and hence are not good for following, However I do try to track any new additions that the Small/Mid cap guys are doing.
Added some Global health post listing. Seems a good play on the hospital sector which is currently showing good overall results and most of the guys are near ATH. Things will move once the 3rd qtr results come.
Key updates wrt the top 12-15 stocks in the Portfolio in 2 particular order
Guj Fluorochem - Trimmed due to weak technical structure. However still putting with major quantities as dont want to be out of this opportunity. I hope the short term pain is not too long.
ICICI Bank - Trimmed some qty. Moved to PSU banks
Page Industries - Trimmed due to weak technicals
Elecon Engg - No major change
Karur Vysya Bank - No major change
RHI Magnesita - No major change
Shaily Engg - Trimmed. May reduce further given the guidance of lower visibility from IKEA for their products. Healthcare may still take 1 more year to give returns. In Hindsight, looks like I entered quite early in the scrip.
Kennametal - Booked profit/ Reduced exposure significantly due to break in price. IT is richly valued and in will grow earnings in 10-15% range. So taking some profits off. Not in Top stocks now
Rolex Rings - Booked profits/Reduced exposure. While mangement is confident of 20% + growth, the actual growth may be lower. Not in top stocks now.
Varun Beverages - No major change
JB Chem - No major change
12 Escorts - No major change
With the exit of Kennametal and Rolex from top stocks, stocks that have come in top league are
1, Karnataka bank (3% div yield, turnaround , Expected net negative slippages(recoveries from provision) and cheap as for all banks)
2. Federal Bank - Reasonable mid sized bank - May grow in line with earnings. Any merger etc may lead to more upsides
3. Raymond - The stock has moved well becoming Top 15 position for me. It is a the cheapest and one of strongest brands available. It has been held back because of promoter CG issues and no clear focus on profitability. However, over the last year, they have been making the right noises and implementing things (Debt reduction, simplification of structure, New top managemen and possible promoter alignment ). There is still lot of value in the company coming from engineering business, their Consumer business and they are looking to monetize it. If anything happens here , it may still work out well.
4. PSU Bank/Financial basket - Primarily led by BOB and Canara Bank with some SBI, REC etc. There might be still room for another 20-25% + from this basket over the next 4-6 months.
Besides this, I have moved out of my gold bonds (SGB) and squirrelling away some cash to build some buffer for any eventuality.
Time for another updates. This is wrt the key stocks and overall portfolio construct.
My portfolio saw a lot of churn over the last quarter and generally for the year. Despite that I generated ~7% returns on my MF sized portfolio for FY23. I would consider this to be success given the context of low to negative market returns and year of sectoral rotation.
Guj Fluorochem - Trimmed further to put in other opportunities. This is the largest holding for me at more than 10% of the portfolio. I am not comfortable with this large size for single stock and hence not adding now. However still putting with major quantities
ICICI Bank - Trimmed some more qty. Generally getting out of Large/Mega caps and moving towards Mid/Small Caps
Page Industries - Exited out of my 10+ year of holding finally. It may still do well but I would invest in other opportunities or once technicals suggest a buy
Elecon Engg - No major change
Karur Vysya Bank - No major change till FY end. However recently reduced it significantly to invest in other opportunities.
RHI Magnesita - Exited due to price breakdown. I still like the company but there will be short/mid term overhang till they start to get synergies as well as Dalmia stake overhang is gone.
Shaily Engg - Exited completely from the scrip. Costly mistake of neglecting technicals and being in love with the company. The growth visibility may be weak atleast for near term.
Kennametal - Exited completely - Booked profit
Rolex Rings - Reduced exposure earlier in the quarter but then rebuilt some of it. Much lower position right now but still remains.
Varun Beverages - No major change
JB Chem - No major change
12 Escorts - Exited out of the company
Given so many exits out of the top stocks, I have reinvested the proceeds in many different stocks with 1-2% Portfolio level allocation.
Kirloskar Oil - I was having smaller position earlier which was increased over the last quarter. Cheap industrial stock trying for transformation and growth
Pharma stocks - I made entry into couple of pharma names led by Zydus, Aurobindo, Glenmark and more recently Abbott - There seem to be some stabilization in US generic prices and some of these companies may be getting the benefit
IT Stocks - Made entry into Sonata, Cyient and Cigniti besides KPIT. I was holding KPIT for some time but reduced it somewhat during the Recent brokerage report induced panic. However the stock recovered beautifully and i bought back most of the shares sold. It still remains one of the strongest IT stocks and with valuations may sustain with growth at premium and large cap not able to outperform
Apar Industries - Recently bought at breakout. The growth story looks strong and market is re-rating it in quick time. Lets see if they can deliver the huge expectations being placed on them.
There are many other entry/exit that I have over the quarter and it would be difficult to talk about all of them. Some key tenets which are probably firmer in my mind now are:
A) Basically I am now developing into an investor who is focused on techno commercial aspect of the stock/company and trying to be in pockets of strength and getting out of stocks exhibiting weakness.
B) I try to be partial towards stocks in my area of understanding but donât mind buying almost purely on technical also with smaller amounts.
C) I am focusing on companies breaking out to half-yearly/yearly high or ATH.
D) I am also not holding stocks below 200 DMA. That is where I exited Raymond(bought some again), RHI Magnesita, Escorts, though they recovered backup. Need to refine this process to understand general market decline Vs company specific decline.
The stock also crossed its 52W high and is at ATH. The stock was consolidating for almost 1 year. It seems to be breaking out. Lets see if it can follow through on todayâs spike on relatively higher volumes.
