Curious to know how u buy with such discipline without failing, waiting like hawk😉.
I mean u put pre-order or few no. Shares or predetermined price or certain percentage of PF… how…??
I think this kind of approach has to be simply the best way for new starters ( for most infact) in the market rather than trying to find hidden gems, buy well established and high quality businesses regularly with discipline.
Hi @MHS…
Thanks for the kind words.
Actually, I consider myself quite poor at Market Timing.
What worked for me was my initial Paranoia wrt Financials and Discretionary companies ( due COVID-19 led lockdowns ) that led me into selling them and converting them to FMCG.
Then the Mkt rewarded me by sending FMCG stocks back to their pre COVID levels when Nifty was at say 9000…on its way up.
By this time I was clear that FMCG stocks have run their course for the short term and hence I started trimming and raising cash. ( again out of fear )
Now the Mkts have started correcting again and same with FMCG stocks. So, I intend to buy them.
None of this was planned. I dont have any foresight on what the Mkts would do next. I have just been lucky.
However just as a base case, I dont foresee FMCG stocks like- Dabur, HUL, GCPL, Colgate, Marico etc…falling by more than 10-15 from here. Same for Pharma stocks like- Cipla, Alembic, Ajanta, Alkem, Natco, Aarti Drugs and UPL ( an agrochemical company )
My plan of action from here on would be to keep buying them in small quantities with every 2-3 pc dip.
Disc: Sold Aarti Industries, NOCIL and Vinati Organics today. ( Aarti and Vinati at 12 -13 pc odd profits and NOCIL at a 10 pc loss. But NOCILs qty was lesser…overall a 5-6 pc kind of gain. Considering the economic situation, I was getting a little jittery about the valuations of Vinati and Aarti. )
Bought the following in small quantities-
HUL
Britannia
Colgate Palmolive
Natco Pharma
Dabur India
Gold ETF
Cipla
Regards,
Ranvir Dehal
Any views on Bajaj consumer care, beaten down a lot, because of promoters interests elsewhere, as a value pick, say in the long run business will emerge, promoters get their act together and rerating happens.
Hi…@MHS
I dont track Bajaj Consumer. My biggest concern was that its practically a single product company which in intself had growth headwinds. So…lost interest.
Although, I may be wrong.
Regards,
Ranvir Dehal
Disc:
Bought small quantities of - HUL, GCPL, Colgate Palmolive and Britannia today.
I aim to keep buying them in small quantities if the mkt keeps correcting.
Regards,
Ranvir Dehal
What’s your opinion on marico vs ITC? I just compared their last yr performance and find that growth of ITC is better than marico. Marico is at around 40 P/E vs ITC at around 13.
Hi Ranvir,
I am mighty impressed the way you buy/ hold/sell many of these FMCG/Pharma names. It is definitely essential to understand entry point for all these names, otherwise could be in stagnation mode. Out of sheer curiosity, let us say HUL -how many you buy ? It does not move too much anyway unless there is a crisis in other counters. Please share if not inconvenient. I plan to follow similar process
Thank you
In my opinion, entry and exit points from FMCG stocks and their allocations are subjective issues.
One has to have a fair idea of a company’s strengths and weaknesses.
For example, even under normal circumstances…GCPL had pressure on its Stock price due headwinds / strong competition in Soap and Hair Colour, weakness in African Mkts, issues with illegal insecticide agarbattis etc.
So…its PE band had to shrink from say 50-55 to 35 or so.
Same with Marico due pressure on hair oils.
Since HUL, Nestle, Dabur, Britannia had no such pressures, they could still command the 50-60 PE band.
Now lets turn to COVID situtaion.
Here, even HUL is under some pressure as signifigant part of its portfolio is kind of Discretionary / related to grooming…brands like- Ponds, Axe, Lakme, Tresseme etc. So…its PE may contract to say 45 or so.
For Britannia and Nestle- the PEs may expand or atleast not fall at all as both sell one kind of products- processed food whose demand is only incerasing as one is often bored of home made food and need some junk to binge on.
So…if one keeps reading their concalls, investor ppts over a period of 1-2-3 yrs…one can get a hang of what their stock prices may do based on their relative strengths and weaknesses. Its like, u have to make it ur circle of competence.
And…I would say- its easy with FMCG…as their businesses are easy to understand.
On ITC-
I kind of avoid it, inspite of mouthwatering valuations due 2 reasons-
One - constant tax hikes that keeps impacting their cigarette volumes.
Two- the management’s inability to turnaround the FMCG business inspite of descent scale. Their FMCG revenues are around 15000 cr ( or thereabouts ) and they still dont report any meaningful Net Profit. This to me and to Mkts at large, is irritatating. And this has been happening for last 3-4 yrs. I just dont know, how to react to it. From 2008 to say 2015 or so, ppl used to buy their argument that they are building brands. But now, people have run out of patience.
These were some of my thoughts.
Regards,
Ranvir Dehal
Disc:
Bought small qty of the following today-
Cipla
Nestle
Alkem Labs
Alembic Pharma
Gold ETF
Regards,
Ranvir Dehal
I see you are accumulating 3 pharma stocks - cipla, alembic and alkem. On what relative strengths and subsegments are u betting on these 3. Also among vast universe of domestic pharma, why you chose these 3.
Lastly, what do you read on GCPL latest results and unavailability of needed products and inability to perform even in hygiene category. Does it deserve to remain in a long term FMCG portfolio? Thanks
Good selection of pharma companies . Curious to know why havent you included Abbott ? Is it due to overvaluation ?
Hi…@investor_No_1 and A_shah
Posting the latest interview of Mr Vivek Gambhir - GCPL
Frankly, I was also disappointed and worried after the results.But, this interview calmed my nerves. Probably the Mkts have also recieved it well.
Another anecdotal piece of evidence- I have clearly seen an improvement in availability of Mr Magic Hand wash Refill packs in local kirana stores in my locality. I co-related this from 3-4 Kirana shops. One of the Shop keeper was really gung ho about it - due to the disruptive pricing. I am really motivated to do some more scuttlebutt.
Mr Magic’s availability in E-Commerce / Organised retail remains low - atleast thats the impression that I have.
WRT the Pharma companies…
I have bought the following -
Cipla
Alkem
Alembic
Natco
Aarti Drugs
I intend to keep them for medium term, unless there are some FDA shockers or some other unexpected events.
Reasons for buying these-
Disc : Sold Ajanta and polymedicure after small profits
Regards,
Ranvir Dehal
Why are you doing this. You seemed to having buy & hold mentality. Is this just trading or indecision? 
Hi…@sujay85
To answer ur question - Frankly, a mix of both.
Ajanta- sold as I thought its valuations were on the higher side. But, thats completly debatable. Moreover, my understanding of Pharma businesses is a work in progress with a long way to go.
Polymed- Was lured by a quick buck.
But…on the whole, the kind of erratic behaviour that I have observed in myself is partially due to the gloomy predictions that one keeps coming across on Youtube.
Also, one cant wish them away as the economic situation across the world is truly - a never seen before kind of thing.
So…thats the reason.
Regards,
Ranvir Dehal
Hi
Interesting to see your preference from fmcg to pharma. Barring a few fmcg names, most companies in the sector are struggling for growth even in pre covid times and things should continue for them in the same vein.
Pharma offers an intersting investment proposition mainly because
Most of the pharma companies continued their production even throughout the lockdown. Production might have been lower due to reduced workforce, but in pharma most companies have got good automation and can do away with reduced workforce.
An important parameter for export oriented companies has been the strength in dollar. Dollar going from 70 to 75 works very favourably for pharma companies.
Of late there seems to be a change in stance by usfda wrt indian pharma companies. I see a lot of announcements of EIR given to various Indian companies.
Approvals of ANDAs are getting fast tracked which allows companies to launch products faster.
Companies in the sector are showing very good resilience in the midst of a weak market. Stocks like alembic have taken out all time highs posted previously in 2015 which says something about the strength. Others like sun, lupin, drl, cadila etc (in fact a vast majority of them) have posted fresh 52 week highs and even while correcting, have held on to levels well above their respective 200 day moving averages. These days its difficult to find stocks sustaining above the sacrosanct level.
From among all the universe of companies, pharma shows a promise of possible growth even within a world riddled with Corona scare. Money in the market ends up chasing growth stocks. And two segments where market perception of growth is strong is pharma and speciality chemicals. Pharma has a wide variety of companies in the listed space and ample liquidity which makes it easier to take decent positions for HNIs and big funds alike.
Lets see how this thesis pans out but in last few weeks I have focussed on buying in pharma space because of above reasons and logic.
Hi…Hitesh bhai
Good to hear from you…always.
I agree with most of the points brought out by you which result in signifigant tail winds for the Pharma Sector.
Would love to know about some of your prefferred Pharma names.
Or …u can just list out the names worth looking at and allow us to work on them.
Regards,
Ranvir Dehal
There are value investors - growth investors - technical traders etc. but you sir is a street smart investor! You switching from Financial to FMCG and FMCG to Pharma and booking profits at the right time is amazing.
Hitesh bhai ,
Isn’t these high valuations and sustaining these 52 week high more of a fad due to covid. do you really think these pharma names can hold these valuation even 12 - 18 yrs down the line .
To me it ooks like a frenzy , a mad rush to buy a lot of pharma names . i doubt if these abbotts ans this divis’ can back it up with numbers .
PS : Am a novice when it comes to pharma.
Hi…
Just an update wrt GCPL.
Did some ground work on Godrej Protekt ( Mr Magic ). Spoke to 4 different Kirana shop owners about its sale volumes. ( all of them within a 3 Km radius in Mohali )
The answer was unanimous - It is selling like hot cakes.
Reason- Disruptive pricing and a descent product.
About Protekt liquid hand wash - sluggish sales, but not bad either.
However - I could not locate any of the Protekt brands in any of the organised retail stores like- More, Easy day.
Disc: invested. Not a core holding.
Disc: I ve started buying Divis Labs.
I am really bullish on API space. Valuations at Divis are a little bit of a concern. So, I intend to buy small portions on Dips.
This is not a recommendation. Just an update.
Regards,
Ranvir Dehal
