Rishi's Portfolio

Here is my portfolio for feedback from this fantastic group. A few things on my list

- Focus portfolio on 15 or less investments

- Ready to sell. Currently have a tendency to hold

- Avoid disasters like MCX and short-term bets like DLF

I have also moved toassigning relativelymore importance to RoE and growth as compared to FCF (which I used to do earlier)

Thanks in advance for the feedback!

Portfolio % Annualized P/L % Straight P/L %
Noida Toll 14% -17% -19%
Ashiana Housing 14% 67% 53%
Amara Raja Batteries 12% 54% 232%
Ajanta Pharma 7% 366% 53%
Kaveri Seeds 6% 54% 9%
Mayur Uniquoters 5% 75% 17%
LaOpala 5% 108% 62%
VST Tillers 5% -73% -3%
Tata Motors 4% 20% 67%
Gold ETS 4% -11% -10%
MRF Tyres 4% 54% 75%
Eicher Motors 3% 72% 169%
MCX 3% -67% -68%
TCS 2% 57% 360%
JB Chemicals 2% 21% 1%
Poly Medicure 2% -98% -9%
Mazda 2% -10% -10%
Supreme Ind 1% 59% 42%
Bluedart Express 1% 213% 41%
Astral Poly 1% 69% 21%
Torrent Pharma 1% 37% 1%
Repco Home 1% 241% 34%
DLF 1% -17% -45%
Alembic Pharma 1% 239% 25%
Portfolio 100% 21%

Good picks . Mostly 20-25% CAGR stories with good promoters at helm except for Noida Toll, la Opala n DLF n MCX . What’s the logic behind picking them?

How long hv u been holding n what’s the PF performance?

Any stock u specially liken are most confident abt n why?

Thanks Vivek.

)- MCX is an open story, unfortunately it was a post-mortem for me and I still hold on (still deploying available cash, so no urgency)

)- DLF was a small trading bet, completely stopped that now

)- Noida Toll was on the theme of high FCF with low risk, Prof. Bakshi wrote on it (btw I took his paper during my MBA, amazing learning). It still seems theoretically attractive but hasn’t moved. Didn’t hear negatively about promoters (although nothing positive), can you explain

)- LaOpala: Did see some mixed comments about management (compensation) on the LaOpala thread but nothing serious to ignore the stock. It has worked fine so far and the consumer story is very compeling

I have been more active in the last 12-15 months but started in 2007. The portfolio performance is 21% (after cleanup from initial learnings) and ignoring MCX and Noida Toll, would be 44%.

My picks are Mayur Uniquoters, Poly Medicure, Ajanta Pharma, VSTTillers in that order while Torrent Pharma and JB Chemicals also look attractive. The key points of my conviction apart from the information on their threads are:

Mayur: Excellent combination of RoE (~40%) and FCF/Sales (~5%), consistent improvement in margins, 15-20% growth. Projecting EPS of 47-50, significant upside even at 10 PE

Poly Medicure: Ok combination of RoE (~20%) and FCF/Sales (~3%), significant margin improvement over the last 4 quaters, 20-25% growth. Projecting EPS of 38-40, significant upside at 10 PE

VST: Ok combination of RoE (~20%) and FCF/Sales (~4%), significant better year projected for sales growth and margin improvement. Projecting EPS of 92-95, significant upside at 9 PE

Ajanta: Good combination of RoE (~28%), FCF/Sales (~10%), consistent improvement in margins, 35-40% growth. Projecting EPS of 57-60, provides margin of safety at 20 PE

Thoughts invited

The EPS projections are for which year?

I noticed in Poly M thread that we are expecting a 18-19 Rs. Kind of EPS for FY 14. What will take the EPS to 38 (100% rise in EPS next year?)

Same question about Mayur.What will take its EPS from 21 currently to 47-50(More than 100%) when growth expectations are only at 15-20%

Apologies. The EPS was not adjusted for splits. Below revised

Poly Medicure: EPS of 19-20 and PE of 20

Mayur: EPS of 23-25, PE re-rating between 16-20

In the interest of consolidating the portfolio exited Bluedart, Astral and DLF. Mazda, Eicher and Repco next on the sell consideration.

Buy consideration for Ashiana, Kaveri, Mayur, VST and Torrent

Repco is one of the better companies you have, you should try to sell Noida Toll and add to Repco.

I agree…there is an article on REPCO by Basant Maheswari in latest outlook business. Reading that may help.

Disc: I hold in decent quantity.

Thanks Commonstocks and Raj. I understand that REPCO is a great company but I have not graduated to evaluate Financial stocks which require a different way of evaluating. Going by the “circle of competence”, planning to sell it.

As far as Noida Toll goes, hoping that after winding down the debt, the dividend should increase, pulling the stock up. Till then they were caught up with the debt restructuring agreement to get approvals for dividends from bank consortium.

Appreciate the feedback.