Portfolio update.... please give suggestions

1.Caplin point laboratories…good fundamentals at decent valuation
2Alembic pharma…same as above plus FCF
3.Lincoln pharma…Will sell and buy Titan biotech
4.Kei industries… expensive performance,market leader
4.Polycab…same as above
5.JK paper…recovered well after Corona scare
6.Deepak nitrite…
7.Vinati organics… expensive performer
8.Chamanlal sethia…entered by mistake now at a loss…cyclic business
9.Berger paints…coffee can stock

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I dont like Caplin, if I were you, I’d put all Caplin money in Vinati

My reason for not liking caplin, since 2-3 years now as I previously did like the company are:

  1. Receivable days increased considerably, management gave the reason for this as mix of customer type or something like that which I dont recall. Any unproportionate receivable days increase means the company is trying very hard to push sales, sometimes even at the detriment of good practice. I exited when the receivable days increase but I was still tracking them. However subsequently another incident made me lose my trust entirely after which I dont track it actively. Which brings me to the second point
  2. They bought one of their distributors increasing their inventory. I had a very had time accepting someone reputed as Caplin would do it. So they sold inventory and later instead of taking back that inventory and reversing the sale, they bought the distributor and recorded the inventory, albeit legally in accordance with accounting standards as new inventory

Other that these 2 companies I dont track the other companies you have mentioned very closely.


A few stocks i have invested in just like you:

  1. Caplin: There is a lot of criticism about Caplin and Caplin’s performance for the past few years. But I have invested in it because of valuations and their entry in US injectables. I am gambling on if they are able to do meaningful business in US in the next few quarters. They have excessive cash (even after capex plans) and are looking for an acquisition. If they get it right then there might be a PE rerating for caplin.

  2. Polycab: Consistent performer. If FMEG growth continues they will be competing with incumbents and I have faith in management and their products are really good.

  3. JK Paper: I invested at ~90 and i still believe it is undervalued. But there are plenty of risks as well. There is foreign threat and the industry isn’t a compounding one. Corona scare is back again.

  4. Vinati: Big expansion, good numbers. Invested at okaish valuation.

I think it is time to exit jk papers and look at satia industries

Added infobeans tech,Titan biotech,alkyl amines
What is the reason for low OPM of sonata software?

Do you still hold jk papers?Any reason on the sudden surge