Thanks a lot @sahil_vi!!! I’m so obliged that you took time out and made a video and shared other resources 
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The list of companies you are invested are having lots of momentum…so will continue to give lots of money in this economic upcycle…
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What I look for is definitely momentum and acceleration in the business fundamentals. Price is a different story. Bulk of my buying in idfc first bank happened at 18 rupees (3x from there), bulk in RACL happened at 80 rupees (3x from there), bulk of buying in neuland happened at 1000 (2x from there), in ncc happened at 20 rupees (3x from there). The important part is to understand the business fundamentals and momentum in fundamentals to understand metamorphosis that might be happening in the business. While people were complaining about idfc first bank being worst performer on bank nifty, I was loading up, based on my reading of annual reports and investor presentations.
So I think the lesson is to not get anchored to the price or price momentum. Important thing is to understand company, and average up and down (understanding company is an important prereq. One cannot blindly average up or down).
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Nice to know…hope u r tracking the other important parameters like free cash flow and the ROE and ROCE of the company…during the bull markets, even no so great stocks go up and then once the cycle turns it goes down and some of these companies with not so great fundamentals might erode wealth in such times…I am sure you have done your background analysis before taking the plunge 
Yes certainly tracking unit economics. Yes, we have to see the cycle : many cycles: india economic cycle, industry cycle, product cycles , raw material cycles. This is why I don’t like holding more than 16/17 companies there is too much to track. 
Hi Sahil, wanted to ask if you have looked food contract mfg players like adf foods and Hindustan foods. does this business have some kind of moat(apart from scale) according to you? It’s an unrelated ques but wanted to know the forum members thought
Hindustan foods is one of India’s most diversified contract manufacturers of fast moving consumer goods (FMCG). it has diversified across various FMCG categories with manufacturing competencies in food & beverages, home care, personal care, fabric care, leather products and pest control.
In the third quarter of 2021-21 (Q3FY21), Hindustan Foods’ standalone PAT grew by 97 per cent year on year (YoY) at Rs 12.60 crore from Rs 6.40 crore in Q3FY20. Revenues jumped 85 per cent to Rs 384 crore in Q3FY21.
demand for contract manufacturing in FMCG industry has been growing rapidly,
On negative side margins are wafer thin and stock is richly valued
Adf food nothing much exciting
Promoter holding has decreased
The company has delivered a poor sales growth. Promoter holding is low
Not much cash flow.
On positive EPS soared from ₹16.36 to ₹24.19, in just one year. EBIT margins were flat over the last year, but revenue grew by a solid 31%
Disclosure: tracking Hindustan foods
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Adf there is nothing special I could find.
Hindustan is a low margin processor. Good if they can scale but it’s a risky business. With a waffer thin Margin even small volatility in margins can kill bottomline completely. I’m not someone who would invest just listening to a word “crams”. There has to enough value add.
On an unrelated note I will sell out of tricoat asap. Rationale:
One way to look at this is questionable corporate governance. Analysts repeatedly asked about merger plans in Q3 call he said no plan all along. And not 3-4 weeks later, then now this. I call b******t on that.
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Quick Update on PF performance (price action):
| Instrument | Avg. cost | LTP | Net chg. | % Allocation | % PF | Type |
|---|---|---|---|---|---|---|
| IDFCFIRSTB | 28.76 | 63.55 | 120.98 | 0.081 | 0.125 | Core |
| RACLGEAR | 103.12 | 271.35 | 163.13 | 0.055 | 0.101 | Core |
| EMBASSY | 341.44 | 320 | -6.28 | 0.149 | 0.097 | Low Risk |
| NEULANDLAB | 1184.32 | 2028.55 | 71.28 | 0.077 | 0.092 | Core |
| VAIBHAVGBL | 2126.94 | 3600 | 69.26 | 0.065 | 0.076 | Core |
| POLYMED | 425.24 | 705.9 | 66 | 0.048 | 0.056 | Core |
| NCC | 32.37 | 89.05 | 175.06 | 0.028 | 0.054 | Core |
| AXTEL | 230.77 | 318.7 | 38.1 | 0.053 | 0.051 | Core |
| LAURUSLABS | 304.87 | 350 | 14.8 | 0.06 | 0.048 | Core |
| APOLLOTRI | 808.46 | 924.25 | 14.32 | 0.059 | 0.047 | Core |
| ASTEC | 1050.12 | 1062.2 | 1.15 | 0.065 | 0.046 | Core |
| SEQUENT | 162.89 | 239.1 | 46.78 | 0.04 | 0.041 | Core |
| DYNPRO | 274.65 | 398.75 | 45.19 | 0.034 | 0.035 | Core |
| MASTEK | 1173.06 | 1173.75 | 0.06 | 0.047 | 0.033 | Core |
| ARMANFIN | 697.8 | 621.9 | -10.88 | 0.046 | 0.028 | Core |
| POKARNA | 208.8 | 196.65 | -5.82 | 0.033 | 0.021 | Core |
| SANDUMA | 754.55 | 1086.6 | 44.01 | 0.017 | 0.017 | Core |
| TYCHE | 219.71 | 209.7 | -4.55 | 0.016 | 0.011 | Exploratory |
| ROUTE | 1670.29 | 1659.2 | -0.66 | 0.015 | 0.011 | Exploratory |
| INDIGOPNTS | 2660 | 2522.2 | -5.18 | 0.001 | 0 | Exploratory |
Total Returns for core PF: 64%
Total Capital Deployed grew 15% month on month
A few notable changes:
- I decided to completely backtrack on the dividend part of PF because it takes a disproportionate amount of effort and attention. Instead, i have invested that part of capital into embassy REIT which should give 7% dividend yield next year (with large part of it tax free) + 5% capital appreciation every year. Pretty sweeet deal. Hailing from bangalore I have visited several embassy tech parks. They are SOTA. Embassy is THE leader in business parks.
- Im quite happy with the total PF returns. 64% Total returns despite 15% growth in PF size again shows robust price action MoM.
- Exited Chemcrux and ITC and will exit tricoat. 1st two were to ensure that my PF only has the best 16/17 companies I care about. I really want to run a concentrated ship. Any more becomes intractable for me due to reading about some other set of 5-6 companies every month + the 9-5 job. Tricoat, i have to exit despite what I wanted to do. There is some arbitrage opportunity in tricoat as i explained in some tweets: https://twitter.com/sahil_vi/status/1366018330922872838 hence, i will sell out of tricoat soon, but not tomorrow.
- Reading about route mobile. Very exciting opportunity. Reading the RHP today.
Disc: Invested in all these companies. Not investment advice. Only sharing this as an example of how to track PF performance and also to ensure i have some public record of everything I am doing.
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Quarterly results…why do you need to track it faster than once a quarter ?
Hi Sahil,
Since you are talking about the arbitrage, I have a question about Tata motors DVR. It is trading at 60% discount, given that Tata motors’ management is talking about being debt free by 2025. Doesn’t it mean a long term arbitrage opportunity in DVR stock once company starts paying dividend?
I think investing is essentially like poker, or any other partial information decision making problem. One can decide not to play if certain set of information (concalls) is absent. That would be a reasonable investing style. Or one could decide to do the thing: for every set of information
available: one can invest a certain amount (K%) of Pf. K can grow alongside one’s conviction. Conviction have multiple sources. Industry structure, VP threads and so forth.
I have studied both kaveri and mother-son sumi, and decided not to invest. Based on, among other information, their VP threads. Not based on their concalls. In this case, concalls were not the only info available which could help one exclude mother-son and kaveri.
Concalls are definitely a rich source of information. I would love to talk to axtel management and understand them better. But would I decide to invest 0% if concalls are unavailable? No, because that would exclude a large universe of good investments. Idfc first bank doesn’t do concalls.
Until few weeks ago, I had 3 microcaps chemcrux, axtel and racl. None of them did concalls. I decided to exit chemcrux due to me underestimating the risks involved, and racl started doing concalls. So, the future is dynemic (pun intended) and things do change. The key is not to overallocate, as if it is a horse race we’re betting on. Allocation should be proportional to conviction. At 5% allocation axtel is neither a large nor a small investment for me.
Hope this helps
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How the dividend from Embassy REIT will largely be tax free. Can you explain or share available article for my clarity.
Please go through this thread before you invest money in REITs:
VP actually has all the info, we just need to look. 
last few posts in this thread has questions/answers on taxation.
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Sorry i have not studied this.
Yes they do. You can read the embassy reit latest concall and investor presentation it has all the details. They are also working to further simplify the holding structure to ensure 100% distribution can be tax free eventually.
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Kaveri was not paying they taxes. That huge contingent liability will always be an overhang on the valuations.
Mother-son sumi missed their 5 yr target by a lot. Btw mother-son I do want to study in more detail. Somewhere I do have a smallcap bias. But if they can deliver and grow topline from 7B$ to 36B$ or even 28B$ in next 5 years that would be a great wealth creation event. I will study mother-son as well but tbh management not walking the talk predisposes me negatively.
Only applicable for kaveri. Mother-son is good from corporate governance pov I think. 
Hi Sahil
Are you still tracking Neogen Chemicals Ltd ?
Since ipo listing its a silent performer in speciality chemical space .
Your views
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Great company, at high valuations. Not sure if it will create wealth going forward.
Bromine space is not as remunerative as the fluorine space. Navin fluorine might be a better investment purely from business standpoint.