Pragnesh's portfolio

Q&A: Questions & Answers Portfolio Q&A
1

Hi ValuePickrs,
Pragnesh here

I am investing in stock market since 2017 in staggered manner uptil today.

…

MY INVESTMENT STRATEGY

BUY AND HOLD APPROACH
I try to study fundaments of company as much as possible.I dont have much knowledge of Technical analysis.

=Generally i dont sell until there is any fraud in company is surfaced in market or fundaments of company are affected severely

…

MY PORTFOLIO

My portfolio is as following with average buying price and % of allocation

1…Astec life … … ( rs 1017.39 ) … (9.8%)
2…Lt food … ( rs 45.18 ) …(.9.4%)
3…Kei ind … … (rs 405.25 ) …(9.4%)
4…Moldtek pack … … ( rs 259.20 ) …( 8.9%)
5…Apcotex … …(Rs 191.62 ) … ( 8.4%)
6…Jenburkt ph …(.rs 620 ) …(8.3%)
7…Grauer&weil … …(Rs53.35 ) … …(8.2%)

8…Paushak …(…rs 2352 ) …(.6.5%)
9…Ion ex …(rs652.14 ) …(5.3%)

10…Ratnamani …(.rs 1298 ) …(.3.6%)
11…Vivid. global …(.rs 42.11 ) …(3.6%)
12…Auro lab …(rs 68.72 ) …(3.5%)
13…Ccl products …(rs 270) …(2.9%)
14…Alkyl aminec … (rs 1979 ) …( 2.4%)
15…Suven phar …(rs 251.64) …(.2.5%)

16…other stocks… …(. 6%)

kilpest,
bajaj finance
kpr mill,
ambika cotton,
Minda industries
Jamna auto
Rajoo engineer
Emmbi ind
Century extrusion
Rain industries

17…In my beginning i had invested in dhfl
,8k mile,
vikas ecotec
skipper,
mohota ind,
balasore
(At that time i was not studying cash flow.)

=I had sold all loosers
=That loss was totally covered by my gain from sell of
-8 bagger Iol chemical and
-ipca lab

18…I had invested 30% of above portfolio in largecap stocks through sip in largecap mutual funds.

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MY INVESTMENT THESIS

1…Investment for long term(5 ys,10yrs or more)

2…I prefer small cap company which is among top 3 leaders in their respective industries

3…company should be listed since atleast 10 yrs ,preferably 15 yrs

4…only growth stocks
=No turnaround companies
=I try to avoid cyclicals also

5…growth rate of 15 to 25% cagr
Not more than 30% cagr

6…PE should be less than 30,preferably around 15 to 25

7…Management
I tried to find out management quality from value picker,annual teport and by serching any fraud in google

8…Financial criteria
A…cummulative cfo=cumm. pat of last 10 yrs
=cummulative pat should match to cummulative cfo

B…fcf% of sales
=Fcf should be around 5% or more in atleast 3 out of 5 financial years.
=Due to capex,there may be negative or minimal fcf in some financial years.

C…Roe/roce>12% in last 5 years

D…I prefer companies having completed capex with Roe/Roce >12%

E…receivables % of sales%
=receivables should be stable
=There should not be significant jump in receivables as % of sales

9…Diversification

=I have invested in almost 15 companies (major holding)
=It is slightly overdiversified because
-all companies are small cap
-Portfolio is slightly bigger for me as compare to my other assets
-i m newbie ,only 3 yrs experience

10…Shareholding
=I prefer companies having institutional holding less than 10% to almost nil.

11…Sell
=Generally i dont sell until there is any fraud in company is surfaced in market or fundaments of company are affected severely
=Basically, i have difficulty in timing when to sell
=I am always reluctant to sell unless fundaments of buisness changes drastically

12…Cash flow study

In beginning of my investment ,i have invested in 8k mile,vikas ecotec,skipper,mohota ind and balasore.

When i read books and online material,i came to know that cashflow study is very important because

A…Some companies inflate net profit.

However,Operating cashflow is difficult to manipulate.

B…Some companies also inflate operating cash flow by converting opex into capex.

So when we study only ocf , we will miss this manipulation .

So we have to study free cash flow because when companies convert opex inyo capex,fcf will be reduced

However,manufacturing companies can not sustain growth without intermittent capex.

So i prefer companies having fcf %of sales>5% with intermittent capex that capex should match with management guidance

However ,due to my strict fcf criteria, i have also missed various opportunities like
Deepak nitrite
Shilpa
Granules india etc

But i want to strictly adhere to my criteria and want to develop philosophy that will give me miss to some multibaggers but it may save me from some of (not all)account manipulations and frauds

…

Performance of my portfolio

1…I have started investing from 2017 and continued during covid time till today in staggered manner

2…My Portfolio was down almost 40% during april 2020.Then it gradually increased and at present it is 2% down from my invested amount

…

Dear members,
Please give your views and advice

Thanks

14 Likes
2

Your portfolio lacks major IT Company, FMCG and Companies which are in Banking or NBFC Sector. It is heavily depended on pharma & chemicals. FMCG companies is always a safer than any other Companies as there is bound to be growth in sales- Eg- Marico, Colgate etc. Portfolio should be mixture of small cap, midcap and largecap. Large cap are good for longrun with intention to hold stock more than 5 years.

3

Thanks for suggestion.
1…I am not technology guy
I am medico person ,so my portfolio is concentrated on pharma stocks and not investing in technology stocks(zero knowledge of IT sector)

2…FMCG companies have ,at present very high PE

3…I have same % allocation in largecap stocks through mutual funds SIP.

1 Like
4

Too many stocks in the portfolio. Many are in temporary growth phase may not sustain growth due to lack of clear leadership position in the market.

5

An old company but getting listed now is at times a great investing opportunity. Long listing history is not required for long term investment based on company prospects.

6

PE less than 30 will exclude lot of potential multibaggers. Companies that have a long growth ahead of them due to big target market opportunity can trade at high PE for several years…

1 Like
7

Since you are a patient longterm investor, you should think about some Largecaps in your portfolio. Moreover, you are a medical person… think about multinational large cap pharma companies. Also, IT & financial names are missing.

1 Like
8

Thanks for suggestion.

9

I expect Astec, KEI, Grauer, Paushak, Ion ex, Ratnamani to do well in medium term. All these are good businesses. Any reason for choosing KEI over polycab? - In my view, both are good but I feel polycab have better future potential due to its FMEG endeavour and brand value across pan India.

Moldtek may face some headwinds in short to mid term if paint businesses take more time to recover. So watch Paint and FMCG earnings in upcoming quaters.

When allocating significant capital in commodity business one should be on top of it. Watch LT Foods and Apcotex closely.

2 Likes
10

Thanks for suggestion

I think,kei has main buisness from EPC segment(b to b) while polycab is mainly in b to c segmen

Rural electrification ,metro and various govt schemes will create good opportunity.

KEI is amongst the few international
players in the industry to manufacture and supply cables of 400kV and company has received largest single order till date for 400kV cables

1 Like
11

I am giving my personal view on making money. I think 15-16 stocks are too many stocks against the returns. Just hold 3-4 stocks whom you know quite well perhaps history of 1-2 years. Invest large amount and keep on taking entry/exit which means you don’t stay invested all the time. You assess opportunities in your companies as per your understanding and make entry/exit decisions.

2 Likes
12

Can u pls let us know cagr from this strategy over 10+ years?

13

How it is called investment if we have multiple entry/exit

I think it is trading and entry /exit on basis of tech. analysis

1 Like
14

You may call it trading/investment doesn’t matter what matters is you should make money. I have invested for 4 years in Welspun and i have seen business is not always same and market is also go through cycles so entry/exit makes lot of sense. In my last 4 yrs of investing in this company i made multiple entry/exit and made handsome money. Coming to technicals I really don’t know that but when you follow a company you understand business(demand scenario/govt policies/raw material prices/crisis) a bit and able to make calls.

2 Likes
15

You make 1 or 2 bets in a year and make 20%-50% in a year on your bet. I don’t know about 10+ years.

1 Like
16

ok so I would understand that you have been making 20-50% consistently every year with this strategy for at least 10 plus years?

1 Like
17

This is a totally new strategy for me. Looks really interesting ! I would like to know more about it. Not everyone may agree with this strategy. But it is a different way of making money in Stock Market… and probably many people may be knowing more about it.
Thinking broadly - Different strategies are :

  1. Coffee-can strategy
  2. Momentum Strategy -
  3. Value investment strategy
  4. Ruffle’s Strategy of Multiple Entry-Exit focussed on limited number of stocks. If you allow, we will call it accordingly
    Do you think a new thread can be started on this strategy?- is it possible to explain this strategy in more detail on that thread?
    Can the Admin or Seniors give guidance?
    i am new to this Forum. If Admin finds anything objectionable, they can delete part or this entire post.
1 Like
18

Astec
Lt foods
Apcotex
Jenburkt
Ccl
These stocks have good Q2 2020 results.

Suven,paushak have average result

1 Like
19

Nice Q2 2020 results from
Moldtek pack
Grauer n weil
Ratnamani
Alkyl amine
Kilpest
Kpr mill.
Auro lab

=Not sold single share of my investment
=Fresh capital invested in paushak,kpr mill,suven pharma
=Sold moldtek RE(right issue)@Rs 700 and invested thst amount in kpr mill

My latest portfolio

1…Astec life … … 9.1%
2…Lt food … …8.6%
3…Kei ind … … …8.6%
4…Moldtek pack…8.1%
5…paushak…8.1%
(.avg buy Rs 2615)
6…Apcotex … ……7.8%
7…Jenburkt ph ……7.7%
8…Grauer&weil … 7.6%

9…kpr mill…5.5%
(Avg buy price Rs 741)
10…Ion exchange……5.0%

10…Ratnamani … …(3.4%)
11…Vivid. global ……(3.4%)
12…Auro lab ………(3.3%)
13…Ccl products …(2.7%)
14…Alkyl aminec ……( 2.2%)
15…Suven phar ……(.2.8%)

16…other stocks… …( 4%)

kilpest,
bajaj finance
ambika cotton,
Minda industries
Jamna auto
Rajoo engineer
Emmbi ind
Century extrusion
Rain industries

1 Like
20

Recent transactions

=I have added Acrysil in my core portfolio

=Bought small % holding in ice make refrigeration

=Sold kilpest@Rs 325
(buy price was Rs161,could not enjoy full ride )

=Sold 0.2% shares of auro lab

=No other transaction done

…

My latest portfolio with avg buy price

1…Astec life … ( rs 1017.39 ) …(8.6%)
2…Kei ind…(rs 405.25 )…(8.2%)
3…Lt food …( rs 45.18 )…(8.1%)
4…Moldtek pack…( 259.20 )…(7.7%)
5…Paushak …(rs 2615)…(7.6%)
6…Acrysil…(rs 177)…(7.6%)
7…Apcotex …(Rs 191.62 ) …( 7.3%)
8…Jenburkt ph…(.rs 620 )…(7.2%)
9…Grauer&weil …(Rs53.30 )…(7.1%)
10…kpr mill……(rs745)…(5.6%)
11…Ion ex ……(rs652.14 ) ……(4.6%)

12…Ratnamani …(.rs 1298 ) …(3.1%)
13…Vivid. global …(.rs 42.11 ) …(3.1%)
14…Auro lab …(rs 68.72 ) …(2.8%)
15…Suven phar …(rs 251.64) …(.2.7%)
16…Ccl products …(rs 270) …(2.5%)
17…Alkyl amine@ (1979 )@( 2.1%)

18…other stocks… …( 5%)
Ice make
bajaj finance
ambika cotton,
Minda industries
Jamna auto
Rajoo engineer
Emmbi ind
Century extrusion
Rain industries

…

=Portfolio is up @12.70% of invested amount which was 40% down in april 2020
(Investment done in staggered manner from sept 2017 to dec 2020 with buy and hold approach)

1 Like