ValuePickr Forum

Raj's Portfolio

Dear All,

I am putting my portfolio for review. I have divided my holdings into two groups.

Core portfolio: It contains my core holdings in which I have built conviction over a period of time and most of them will remain there for next 5-10 years, unless the story turns sour. It constitutes 85% of my investment.

Satellite Portfolio: It contains the stocks which I have got interested but do not know enough of it. Once conviction is built, the stocks from this group may replace my core holdings. It constitutes 15% of my investment.

Core Portfolio:

SN Company %Holding Target Holding Average Cost Remarks
1 Hawkins Cooker 34.10% 25% 1032 Kept buying since last 4 years
2 Page Industries 17.46% 20% 0 Took out my capital. Have been buying since last 4 years.
3 IndusInd Bank 14.67% 15% 367 Purchased in last one year
4 Titan Industries 5.73% 15% 0 Taken out my capital. Have been buying since last 4 years
5 Gruh Finance 5.57% 10% 128 Purchased in last one year
77.52% 85%

Satellite Portfolio:

SN Company %Holding Target Holding Average Cost Remarks
1 Unichem Lab 4.44% 5% 179 Have bought in last 3 months
2 Ajanta Pharma 2.91% 3% 581 Have bought in last 3 months
3 Poly Medicure 2.87% 3% 468 Have bought in last 3 months
4 MayurUniquoters 0.66% 2% 484 Have bought in last 3 months
5 Astral Poly Technik 0.84% 2% 399 Have bought in last 3 months
15.24% 15%

I also have Blue Star in my portfolio since last 3 years which is down 50% from my buy price. I intend to sell it in next couple of quarter when the prices move a little upwards as summer should throw up better sales expectation.

Around 7% is cash right now which I would like to deploy in next 1-2 month.

Please provide your input. I will put my thought process behind each one of my core holdings in my next post.

Regards,

Raj

Some notes:

**Hawkins:**This has been a stock which has tested my patience to the maximum. I am expecting some big bump up in the price in next 2-3 quarters due to the resolution of various issues it has been facing. 25% secular growth with 2% dividend yield is going to come from Hawkins for next 5-10 years. Hence it remains my core holding. I do intend to reduce my holding to 25% in next one year though as 34% is too high.This is a stock where only opportunity cost can be lost if the things don’t play out as expected.

**Page Industries: **This has provided me the best return so far. The story has been going very well. next 5-10 years even Speedo will contribute much bigger to the sales and it has a great potential. The numbers speak themselves. It should remain one of the prime theme of Indian consumption.

**IndusInd Bank: **This bank has been able to come to the forefront under the leadership of Mr. Ramesh Sobti. Numbers have been good consistently with great control on NPA. The expansion is happening very well and potential seems to be quite good.

**Titan Industries: **This is probably one Indian retail company which is creating Brands much faster than anybody else around. I feel this is going to be much bigger in next 10 years…probably 10-15 times in size if Indian growth story and rise of middle class plays out as expected.

**Gruh Finance: **A mini HDFC with huge potential. Great compounder, though exponential rise will not happen due to higher valuation. But must have in anybody’s portfolio who hopes to have a 25% compounder for a decade.

one thing I have observed

You have ted stock in your core pf and vp stock in**Satellite pf.**

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Over all best pf you can have @ current market.

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in**Satellite pf.**

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Your observation is correct. I have been on TED for more than 4 years, hence know the stocks better and built the conviction over a period of time.

I still have to build more conviction on my satellite portfolio as I am still learning and trying to understand these stocks better. Hopefully one or two of them makes to my core in next one year.

Nice portfolio.

Few thoughts:

1). Difficult to take a call on Hawkins for 5-10 years - based on current product range and management aggression to grow.

2). portfolio weightage are quite skewed.

3). target holding % are fixed or change as per relative attractiveness ?

4). i think this concept of zero or reduced holding cost by taking out profits seems more mathematical illusion. this could lead to less stringent evaluation of opportunity cost. i would rather take out profits and enjoy that, and keep cost price intact :slight_smile:

1).

Agreed. Next 2 years should show the path if the assumptions are true or not.

2).

Agreed, here as well. Hence the target portfolio. Hawkins need to go down significantly.

3).

For now fixed. Need to be reviewed periodically.

4). :))

Agree with you on this. Past prices are just a number which should be ignored. The concept of free shares are more of illusion than reality.

Overall agree with you on your comments. I will make some changes in the current down fall to streamline my portfolio by adjusting the weightages.

raj,

just a query, Why not stick to something that has worked for you till now quite well?

Why this change in strategy to diversify?

Question is mainly to understand mindset of different types investors and their reasons for departure from a fixed strategy.

regards

hitesh.

Hi Hitesh,

I am changing my strategy in a small way as most of my investment remain in core only.

**Core Holdings:**These are great compounders and market already knows the story. More importantly I have built enough conviction in them. Hence still 85% will remain here.

**Satellite Holdings:**These are new ideas which I have started liking but not enough conviction as I do not know much about them. Even they are not very popular yet with the market. Also, they have a potential to replace my core holding if one of the story doesn’t play out as expected.

Hope I am able to explain my rational behind the changes. Let me know your thoughts on what you think about it.

Regards,

Raj

Sold all my none core holdings and came out of leverage completely as it seems Mr. Market is in a bad mood and things could turn ugly in next few weeks. Sold IndusInd as well, with the view that banks may get hit harder

Now the portfolio looks like as below:

Hawkins(37%), Page(29%), titan(13%), Gruh(9%) and Unichem(12%).

Raj

Pl post more often .Your views are lucid n sage.

Yes, totally agree with Subhash.

Raj - what is your take on Titan? Also, what levels do you think will be good entry points for it? Sukhani seems to think it will touch 200.

HG,

Sukhani is a trader and he will look from that angle. His idea will be to make 5-10% and get off. Hence his targets based on trend will always remain.

If you wish to have a great compounder Titan can be one. It’s a secular long term story and probably only non-FMCG company which is creating enviable brands(Titan, Tanisq, Fastrack. Titan Eye+ to name). They all will be big considering the India growth story.

I will sell my house and buy Titan if it reaches 200…Just kidding…

Will definitely double my position what I have at the moment at those prices. I easily see Titan having a potential of becoming 10x in next 10 years.

On the other hand you also have undervalued mid/small capstocks where percentage returns will be higher. But you need to have both entry and exit strategy in place when you get in. Also in****my view one can’t bet more than 5-6% of net worth on each one of them.

Regards,

Raj

Raj,

Appreciate your insights. I’m buying Titan slowly. I have been guilty of buying too much too soon in the past. Learning from other senior’s buying strategies and trying to be patient. Could you share your buying strategy?

HG,

I do not have a fixed strategy for buying. However I use the PEG ratio(<1 in normal cases) to compare if the price is reasonable. Good sound companies(with great underlying businesses) on growth track can always take care of mistakes of buying at a higher price over a period of time.

I don’t understand technicals, hence don’t try to guess where the actual bottom or top lies. I just try to buy when prices stabilize.

Regards,

Raj

Bought back Ajanta @670/-. It is too volatile and looks like there is lot of speculation going on.

My restructured portfolio looks like:

Hawkins 40%, Unichem 24%, Page 15%, Gruh 11% and Repco 10%

Sold Titan(business model change) and Kaveri to pay back my leverage. I was almost 20% on leverage.

Want to stick to quality names where downside protection is somewhat available. Doesn’t look like the market is in a mood to turnaround quickly.

i think you are trying to balance these 2 things

1). protect the downside because of possible bearish market going ahead

2). position yourself to benefit from the high growth regardless of bull/bear market

i think this is an excellent strategy in the current environment, however i am skeptical about allocating anything more than 20% to a single stock after titan fiasco. i would put that burden on 2 stocks instead of 1 and hope atleast one will do the job.

Dear Raj…

Any changes in your portfolio…

Regards

mallikarjun

Hi Mallikarjun,

There are some changes in the portfolio. Unichem is out and REPCO has significantly moved up in weight. The current one looks like:

Hawkins: 26

Page: 27

Repco: 26

Gruh:15

PI: 6

I sold some Page and did some movement in and out of Kaveri, Astral, Polymed and realized that the result could have been similar if I would have stayed on. Hence bought pack Page again.

Lesson learnt:You can’t have conviction to bet big on borrowed conviction.Unless you bet big you can’t make significant money.

Hawkins has been only struggling stock in my portfolio.I am ready to give it one more year as it seems to be limping back to better days.

I would take PI higher with additional money gradually.

**Super. I think your allocation to Hawkins is a bit high. Still high. It was previously at 40% which is too high.Allocation to non-performing stocks should never be 26%. We can always wait for an earnings trigger and catch it up. Conviction is good but making money is too good.
**