Rajeesh's Portfolio

Hi Everyone,

I have started investing 1 lakh a month in equities, PF and Gold. I would really take help of the members in making my stock portfolio streamlined. I’m 30 years old and all of my stocks are for long term

This is my portfolio

Company Name Avg Trading Price % weightage % profit
ITC 435.27 7% 20%
SAMHI 195.11 2% 4%
Tata Motors 958.19 5% 4%
Natco Pharma 1213.74 11% 16%
Trent 4858.77 3% 61%
Electrost.Cast. 207.51 2% 4%
KNR Construct. 278.63 1% 21%
Indus Towers 314.20 6% 25%
Guj Pipavav Port 183.92 4% 19%
United Spirits 1268.10 2% 26%
C D S L 1445.67 1% 1%
VBL 624.61 2% -3%
Tata Steel 170.89 1% -3%
Vodafone Idea 15.82 0% -33%
Infosys 1615.46 2% 18%
Zomato Ltd 261.31 3% 6%
Nippon India Nif 19.73 1% 21%
South Ind.Bank 29.34 1% -16%
Quess Corp 721.16 2% 9%
Balmer Lawrie 248.75 5% 10%
Larsen & Toubro 3577.91 1% 4%
ZAGGLE 398.72 3% 11%
HDFC Bank 1612.44 2% 9%
Lemon Tree Hotel 120.13 0% 2%
Aditya AMC 680.78 2% 8%
Jio Financial 352.21 3% 2%
Titan Company 3662.67 1% 4%
L T Foods 234.55 2% 69%
ITD Cem 402.48 1% 35%
Bharat Electron 274.69 2% 7%
BLS Internat. 410.40 4% -9%
Pricol Ltd 487.63 2% -3%
Manappuram Fin. 184.48 3% 10%
ICICI Bank 1174.75 3% 11%
Bharti Airtel 1437.83 4% 21%
Amara Raja Batt. 854.99 1% 63%
Epigral 1336.51 2% 67%
Nippon I Silver 84.02 1% 5%
Indian Hotels Co 692.38 2% 3%

I know its messed up, but any help is appreciated. My investment journey started just 9 months ago, this is my 10th month

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I think you should reduce number of stock.You have to spend lots of energy and time to manage this portfolio.You may choose your one best stock from one sector instead of buying two or more stocks from same sector.

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A portfolio of around ₹1 crore can ideally have a maximum of 33 stocks but i see you have 39 approx. However, if you’ve been investing for 9 months with ₹70k per stock, I would suggest starting with around 15 stocks initially. Once you’ve reached about ₹3 lakh per stock/ if in equal percentage, you can gradually diversify further. But even with diversification, it’s best to cap your portfolio at 30-33 stock holdings to maintain a balanced and manageable approach.

Also VP is good forum to discuss. However if you are investing your hardearned money, please also study on the side from YT or do some good courses.

Good start -

Subscribe to daily letter of Finshots, Groww Digest etc.

Follow some YT channels namely - Vivek Bajaj, Vivek Singhal, Sahil. They are enough to make you self established. And also below course is an add on.

6 Likes

Hi rajeesh ji, even I am a novice and have a lot to learn but I actually believe you have too many stock in your portfolio about more than 30. It’s tough to track and even for example you have a 1%allocation in ITD Cem and just let us say it’s stock price goes up 50 times, which is an incredible thing. Your portfolio will only go up 0.5 times, which does not change much, my suggestion even if you are a conservative investor keep only the number of companies you can track, ideally speaking less than 15. And the diversification you want can be high quality companies across a number of industries and not concentration in one industry. That will give you nice exposure. And this I am suggesting for the long term.
Sincerely,

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Thanks for that , it will be really helpful.

I appreciate the help, thank you so much. MY only problem which I face right now with respect to this portfolio is, for almost all the stocks I have a solid reasoning, selling half off them would be tough (not impossible but tough). Let me come back with a condensed portfolio with hypotheses for all of them. I want to hold all of these & do SIP on stocks until portfolio until it reaches a corpus of say 50 L or so and hold them for a very long term (15 year or above) & continue diversifying asset classes as per the risk appetite at that age. Right now I have 70% exposure in equity, 10% in debt, 10% in liquid funds, 10% in gold (physical)

Rajeesh ji, I know you have a solid research, but I would stress on the fact that you can choose which 15 or so you would want or have a stronger conviction than the others , because after a while the transcripts, annual reports, analyzing the business models and comparing its peers of 30+ companies is laboriously tough.
As Charlie munger says -" The idea of diversification makes sense to a point - if you don’t know what you’re doing. If you want the standard result and don’t want to end up embarrassed - then of course, you should widely diversify. But nobody is entitled to a lot of money for holding this view."

I understand, I dont have much time for managing these many businesses as well in my portfolio…To be honest I always had that FOMO of seeing the posts which goes like if you had invested Rs.10000, it would have gone 10x or 20x. I have to let go of few scripts then and reconstruct, stock picking and portfolio building are 2 different art then.

Okay let this be a start of a new journey then, making a mistake, reconstructing and travelling all along.

Planning to offload

Trent - Too small a position but I think its way too over valued, the thing is they are participating and competing in a market which is buzzed by million unbranded players, im quite sure though the indian consumption story is here to stay, I’m planning to divest

Gujarat Pipapav port - Highly manipulated stock, I bought it out of a SEBI registered investor advice but this is a collateral damage where I could not monitor the movements because of too many stocks in a portfolio

KNR construction - Government dependent business, promoters are decreasing their holdings and their Stocks Underperforming their Industry Price Change in the Quarter

Vodafone idea - No brainer. Just loss harvesting which will give me enough time to concentrate on other businesses

Silver ETF - I’m already investing on gold, owing to which im divesting and it has too little weightages

ITD Cementation - A fantastic company just offloading owing to too many picks in portfolio

L&T - Too big a company and its already covered in my ELSS MF portfolio

Infosys - Company is going through distress, the pipeline of projects are dry and would rather prefer to pick smaller IT companies or IT bees to leverage rupee losing value

Lemon tree hotels - Investing in IHCL and Samhi hotels in alternate

Aditya AMC - Unable to concentrate right now and not interested in their business to be more honest

Balmer Lawrie - I have spent good 10 months in this stock, even in the all time high, this stock is not going anywhere. Rather would invest in more convicted picks

Amara Raja, HDFC, ICICI, South indian bank - There are better Large cap players for all of these sectors whose growth is yet to begin

EPIGRAL - Meghmani finechem, has already given a good run up, and I am more convicted in taking a position in Natco rather

BEL - A new nifty 50 entrant but not in my circle of competence

Titan - Too little a position to even consider meaningful returns

This brings the list from 38 to 20

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Great progress Rajeesh Ji, I was doubtful of KNR Construction, Vodafone and Gujarat Pipav Port when I initially saw it in the portfolio.

If you don’t have time to mange stocks, then best thing is to invest through mutual fund. Go in for 50% in large cap funds and balance 50% in mid cap, small cap, defense etc. There is no point in holding such a large portfolio and get totally defocussed. As an experienced investor I always tell people not to invest more than 15-20 stocks whatever may be the value of your portfolio. Maximum investment in one stock should be not more than 10% of your total portfolio value. Invest in stock only if you are able to give lot of time for due diligence initially, then once you have the stock in your portfolio to track their quarterly performance in order to ensure they are on track so on & so forth. Just because others have stocks in their portfolio, you should not be jumping into investing in stocks. Mutual Fund are there for people like you who can’t spend too much time in investing in stocks or who don’t have the experty in investing in stocks. So take the route of investing in funds and start investing in equity only if you have time & required knowledge to invest in stocks. These are my advise to you

Right now i have many stocks in my portfolio. The problem is portfolio allocation/ construction. So, Yes mutual funds is an option but i prefer direct equity. Because honestly I dont believe any active fund managers. I’d rather go down direct Nifty 50 or Nifty next 50 funds.

I’ll try focusing more on how to get this into a good shape in terms of trimming down and narrowing the focus

So I took some hard calls during this time by incorporating all of the advices I received. I ended up starting SIP in SBI contra fund (15k), Helios Flexicap (20k), Quant smallcap (15k), HDFC gold fund (15k)

Then I ended up fixing my portfolio a little bit as well, as I was explaining and I sold off all my non convicted stocks and broke my portfolio into 2 cohorts

  1. A core portfolio of 20 stocks
  2. A satellite portfolio of 10-15 stocks based on Naked trader strategy by Robbie Burns which is managed by smallcase by Windmill capital

Even within the core portfolio i am planning to siphon off Indus towers and Bharti Airtel

This is my Core portfolio

  1. Amara Raja
  2. BEL
  3. BLS
  4. Samhi hotels
  5. CDSL
  6. Electrocast
  7. Infosys
  8. Jio financial services
  9. LT foods
  10. Tata motors
  11. Tata Steel
  12. Trent
  13. Zomato
  14. Zaggle
  15. Natco pharma
  16. Varun Beverages
  17. United spirits
  18. ITC
  19. Bharti Airtel
  20. Indus towers
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The plan is to have SIP in these stocks and rebalance (if needed every quarter) and I plan to go full throttle in investments

Right now, I have a rough view on individual net worth

  1. Equities - 60%
  2. MFs - 20%
  3. Gold - 15%
  4. Debt (PFs, PPF) - 5%
  5. Cash - 5%

At the age of 29 (turning 30 this year), I am having higher exposure in equities, the higher risk which i will reduce post mid 30s, I have good enough run way I suppose to achieve the goals

My immediate goals are getting married (A spend i have to bear)
1 individual house in my hometown
1 car
A simple business in my hometown by late 40s

Fingers crossed, with just faith on my discipline

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Exited Varun Beverages (VBL) and bought Dr.Reddy’s Lab

Rationale:

  • VBL declared poor profits which is lesser QoQ,
  • it has high stock promoter pledges,
  • Technically Pepsico but its not Pepsico, I would rather invest in a business which I understand better
  • book value is deteriorating and
  • it is in high sell zone

It has high PE and high PEG ratio

Why Dr.Reddy’s?

Not a favourite stock especially in this forum, but along with IDFC, Tata motors, it is screaming at me with valuations like pick me.

  • Dr.Reddy’s Lab is a pure cyclical play.
  • It is much cheaper,
  • I understand this business as well as I’m tracking Natco Pharma
  • it is having high ROE,
  • Low debt,
  • increasing EPS,
  • increasing Book value
  • and it is a hedge for falling Rupee.

Plus its a top loser in pharma space as of now. It has the highest foreign holdings for the PE that is trading.

So I have two investment rationale, which I am convicted on and start investing slowly and steadily.

  1. India is witnessing a K shaped recovery in terms of Economy and
  2. Price of Rupee is falling and dollar is strengthening,

Can you share more insights on your investments in Indus Towers. I too have it in my portfolio and due to Vodafone Idea leases for towers the stock price have suffered a major hit. Also the sales growth is not so attractive but there is great margin expansion noticed which lead to PAT growth. It would be great if you share your insights.

Fantastic pick @Chirayu_Shah

In simple words, grow along with the industry and the company rather than to chase the after it has grown

Fortunately while I thought it was a strategic pick. It fits into this cigar butt style investment of Warren Buffett. If it crosses one hurdle of net receivables, there is nothing like this investment. In The 22 Immutable laws of Marketing, Al Ries and Jack Trout, this company clearly tells its investors what business it is into.

However, as a country, Indian mobile internet & telecom is one of the cheapest in the globe thanks to regulatory nature of Indian government to protect the customers and citizens of India.

Once the tables turn, the telecom sector will be a cashcow, depending on how we are currently addicted to digital products and data being compared to oil.

Without the internet, our salaries, stocks, mutual funds, everything is just a bunch of characters in the digital screen. As the telecom industry is penetrating further into rural India with Digital India is on the forefront, Booming AI ecosystem and approaching 5G & 6G, we can expect more dependency on to the telecom industry. To make this happen Indus towers is one of the key players , (basically market leader) who has to survive the Vodafone Idea Onslaught which has high 2G customers which Airtel and Jio cannot penetrate into. In my MBA days, this was one of the key topics to make us understand the type of markets. The telecom industry is (was) a Oligopolistic market now slowly turning into a Duopoly. However, this will be taken care by Indian government to maintain the competition.

Following the merger, Indus Towers is one of the largest tower infrastructure providers in the country and globally. The business of Indus Towers is to acquire, build, own, operate and maintain tower and related infrastructure. Indus provides access to their towers primarily to wireless telecommunications service providers on a shared basis, under long -term contracts. Indus Towers caters to all wireless telecommunication service providers in India. Indus has a nationwide presence with operations in all 22 telecommunications Circles in India.

As on Date, Bharti Airtel Limited along with its wholly owned subsidiary Nettle Infrastructure Investments Limited held more than 50% shares

Airtel plans to Indus Towers with its data centre business Nxtra, reported CNBC TV18. Further, Indus Towers cash would be used for Nxtra expansion, said the report. Airtel aims to make its telecom business asset light via Nextra and Indus Towers merger.

Consolidation of the majority shareholding in Indus Towers, and then merging it with the data centre business is apparently part of Bharti Airtel’s mega plan to of two-pronged strategy to capitalise on Indus Towers.

Indus towers key ratios:

  • Company has been maintaining healthy ROCE of 30.08% over the past 3 years.
  • The Company has been maintaining an effective average operating margins of 48.38% in the last 5 years.
  • Company’s PEG ratio is 0.06.
  • P/BV at ~3.5
  • The company has shown a good profit growth of 21.86% for the Past 3 years.
  • The company has shown a good revenue growth of 27.04% for the Past 3 years.
  • Company has been maintaining healthy ROE of 22.66% over the past 3 years.
  • The company has an efficient Cash Conversion Cycle of 72.23 days.
  • The company has a good cash flow management; CFO/PAT stands at 1.96.
  • The company has a strong degree of Operating leverage, Average Operating leverage stands at 46.90.

Yes I agree their YoY Sales is flat but their 3 year growth is 28% but for the same sales they have increased their bottom line. We need to look at the big picture for sales triggers

The company is holding Vodafone for its receivables threatening to discontinue its services for which Vodafone has responded with a negotiation of a softer repayment terms. Vodafone is a severe hurdle but too big to fail which will put many parts of India into dark if they don’t get into terms. Good part is Govt. (Or say to say SBI and LIC has put some life into Vi) and we can expect a good turnaround in long term at this price.

And most of all, their free cash flow has increased by 2.4x times YoY, they have even bought back their shares which is a big positive sign for shareholders and its part of staggering 29 different indices including the elusive MSCI index. I’m bullish. Markets are irrational, finding value is the hard part

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A significant factor in PAT growth of Indus towers was the continued collection of overdue payments from a VI, which resulted in the reversal of Rs. 10.8 billion in doubtful debt provisions, enhancing profitability for the quarter​. Please dont expect such a jump next year

And fun fact, its part of Wright’s Alpha prime smallcase portfolio constituting above 10% weightage as on date

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