Thank you @sougataG @ashwin2 @ca.namish @kkrai @Pravin_Kumar @Gautam_Chopra @ishikaghose for the kind words. Will try to continue writing and contributing. Apologies if I don’t answer specific queries on other stocks - its not because I dont have time but I may not know much about stocks I dont own.
Some thoughts on markets and pf
Market seems inclined to go down. Not because it has to but because it wants to. There seem to be new reasons every week. Last Monday it was HMPV virus which caused similar cut and now it is the usual cocktail of USD/INR, FII selling, US10Y, Brent, DXY etc. The LA wildfires seems to be the new bearish mindvirus. Then there’s our budget and Trump taking over on the horizon. There is clearly a fatigue in several names across market cap and bearish breakdowns are all over the place. Bearish views are spreading quite easily and I sense panic everywhere I see.
I would have run at the first sight of trouble if I was the same guy I was in Sept '23. I reversed that bearish view in 2 weeks or so and re-entered Shilchar which I had sold earlier and bought Garware, Ceinsys etc. after that and thankfully it all worked out fine. I am faced now with the same situation but as they say you never step into the same river twice because its not the same river and you are not the same person.
Staying put through LTCG tax revision, June 4th election result, MH elections and numerous other big cut days paid very rich rewards. It wouldn’t have been possible to stay put if I did not understand what I owned and why I owned them clearly. Why should that change now? Doesn’t mean it will work out this time too, but I am bound to kick myself harder for changing a system that worked just fine. Besides, Its a lot easier to put up with a drawdown in familiar names (esp when they have very good prospects and earnings triggers).
Just as a wildfire gets worse the larger the uncleared deadwood, brush and debris that collects over time, sharp bearish falls don’t end until the last weak hand has thrown the towel. Thanks to social media though, the contagion spreads very fast and can perhaps be modeled like how a viral infection gets modeled. My favorite is this simulation which works based on a SIR model but is visual. The immunity section is key to understanding how this works. Play around with the immunity slider to see how it affects transmission. In the markets immunity develops in pretty much the same way. I will explore this in depth perhaps sometime in the future.
Taking a broader view, barely 2 weeks have passed this year and there has been so much jitter in such a short span of time. In what I own, which is currently whittled down to just 6 names (Ceinsys, Shaily, Wockhardt, Axiscades, Holmarc and Genesys), 4 of them are in the green for the month and 2 in the red (Also 4 of these names have been held for a year or more while 2 are relatively new). Ceinsys has received LoA for the Wainganga-Nalganga 380 Cr order for which they were L1 and should have a order book of Rs.1600 Cr with 115 Cr in L1 pipeline (at least). Wockhardt has received approval to launch Nafithromycin (Miqnaf) and today showed results for the Meropenem resistance trials which are very positive and should allow it to launch Zaynich in India shortly. The global phase 3 trial is complete and hopefully we will hear about preliminary findings before they file with FDA. Shaily exports continue to remain strong. Holmarc continues to win tenders and grow exports and there’s no reason to think they may not do 40-42 Cr+ this FY (should achieve the 4 Cr/mo or 24 Cr in H2) and 60 Cr next FY (5 Cr/mo). Axiscades ran up too much and should find value emerging below 700 and Genesys appears to be guiding for very good growth next few years as per AB Capital research report which also covers Ceinsys.
I am not sure how long this bearish phase will last but i believe most of the pf stocks should grow earnings at 40-50% in FY26. If things don’t play out at least I know what my thought process was at this point in time.
Disc: Fully invested with zero cash. Writing helps me gather my thoughts and get some clarity and posting here helps me be honest. I am not qualified to advice.