Praveen's Portfolio

Q&A: Questions & Answers Portfolio Q&A
22

Hi sreeram

Thanks for your question

I made a list of the stock I’m interested in and I track them with a google sheet

Company CMP Industry Today’s FY Target Year Target Metric Profit/Ebidta/Sales/Book value in Target year Target Multiple Exp Market Cap CAGR
FLUOROCHEM 3231 Chemicals 2023.7 2025 P/E 1300 35 45500 21.1%
ANGELONE 3253 NBFC 2023.7 2027 P/E 2500 25 62500 28.5%
TANLA 1091 IT Services 2023.7 2025 P/E 650 25 16250 8.1%
DEEPAKFERT 658 Chemicals 2023.7 2026 EV/EBIDTA 2900 8 23200 38.9%

So bassed on this kind of list I see where I can get most return in CAGR terms and invest accordingly. So, wherever I allocate more where the odds are in my favor. In addition to this I follow a few more things

  1. Reduce the weightage where drawdowns could be bigger
  2. Keep allocation to each sector less than 20% (Chemical and Agrochem is still less than 20%)
  3. Exit gradually where the risk reward is diminished or keep stoploss. (exited Angelone and MCX partially because of this reason)
  4. Follow what my mind says in addition to the numbers in the sheet

IT and ER&D:

  1. I pay lot of attention to valuations and PEG. So, I didn’t find many good bets in IT cos here. All the big IT cos are trading at >25x PE for grwoth of 10-20% and same for ER&D. So, didn’t invest much in IT cos
  2. Cigniti tech is an IT co which is still available at 17x P/E and I’ve invested here a few months ago
  3. Mold Tech Technologies is in Engineering services work and supports customers mostly in NA. So, you can say I have some weightage to this ER&D co
    From both these cos I expect >20% CAGR revenue and profit growth and found the valuations attractive at my buying price and even at current price

Auto Anc:
Mayur Uniquoters is the only Auto Anc in my PF

Chemical cos:
As I’ve mentioned already I pay attention to the price I pay. IMO chemical cos are at good valuation and the drawdown would be very small from here. In fact after very bad results in recent quarterls the stock prices didn’t fall much. I expect the cycle to return to normal atleast in next 3 years and with the earning improvement and valuation rerating I expect to double the money in next 2-3 years. Shortly better Risk reward

Hope this clarifies.

Praveen

Disc: Invested and biased

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