Shubham's First Portfolio

Hello Everyone,
It’s great being a part of the ValuePickr Forum, Let me give a brief introduction about myself before moving on to my portfolio.

I’m Shubham, I’m 19 years old and currently pursuing my studies in commerce stream. I’ve been interested in stock market for an year now, but I’ve only started observing markets very closely from the last 6 months now. So this will be my first portfolio as this is the first time I’m investing in the stock market. I’m also not a genius at tracking and analysing the fundamentals of companies but I do have some basic knowledge of the same. I’ve also referred to a few books like ‘The Intelligent Investor’ by Benjamin Graham & ‘The Motley Fool Investment Guide’ by David &Tom Gardner for some extra knowledge but majority of it is from reading ValuePickr especially posts of Hitesh Sir overtime.

My Portfolio which you’ll see below is having 2 columns (For already invested & Planning to Invest). I plan to fulfill my investment in these stocks over the next 3-4 months. The basic rationale for choosing all these stocks in my portfolio is that I want a defensive or passive portfolio which can provide me stable returns over time with minimum risk. I’ve also invested in only 2 small cap companies because I prefer to follow the quote “Put all your eggs in one basket and then watch that basket” for small caps.
The rest of the large cap companies I’ve chosen don’t really need to be tracked all the time, So I plan to watch and concentrate on these companies more actively than rest of the companies. As far as the time period is concerned I’m willing to keep my money invested in this over the course of next 5-7 years with bare minimum changes in the stocks. So the stocks I’ve chosen are on the safer and passive side. Also one line rationale for each stock has been provided below the portfolio.

Asian Paints - The company operates in more than 65 countries, is the largest paint producer and one of the fastest wealth creator of India. Company is also debt free and the brand value is quite attractive too.

Pidilite - Pioneer in consumer and speciality chemicals in India and has a monopoly in sealants and adhesives. The brand equity is also very high with a great product distribution channel.

Nestle - The company has sustained market leadership in 85% of its portfolio with 11% real internal growth.

3M India - The company has a strong balance sheet with zero debt and great brand value.

HDFC Life- One of the top 3 Private Life Insurance Companies in India & Part of India’s most reliable HDFC group and Life Insurance sector having a great potential in the future.

HDFC Bank - Best Bank from one of the best groups of India and continues to deliver sustainable growth with stable asset quality.

Abbott - A debt free company & the Pharma Industry in the future having great potential too.

Sanofi - It is a cash rich company & one of the fastest growing companies in India in Anti-Diabetic Therapy.

Titan - A subsidiary of the Tata Group and fifth largest integrated watch manufacturer in the world.

Bata - India’s largest footwear with retail network of more than 1400 stores. Bata is far ahead of peers at national level and serves as a one stop footwear destination.

TCS - The largest IT Sector Company in India & having robust business structure with strong digital competences, ability to execute multi year multi service deals.

Shree Cement - Leadership position in the north and strengthening steps in the east and entry in the southern region and expansion in the west will make it the best picks in the portfolio

EbixCash World Money - Number of acquisitions by the holding company in India and planning of IPO in the near future by the holding company. Although the parent company is listed on Nasdaq but more than 50% of their business share comes from India.

Sika Interplant - With tiny equity of 4.24 cr. And having 72% promoter holding seems like share has a good future ahead as the company is engaged in defence production.

P.S - I’ve invested about 43% cash in these stocks since the last 2 days and I plan to complete to my investment by the end of next month. Would love to hear any suggestions, comments or improvements :slight_smile:

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Congrats at investing at age 19. I went down a similar path at your age. Makes total sense to go with bluechips. So I like all your picks. However, you’ve gone for ebixcash world money. The only time I’ve seen that stock mentioned was as spam in the money control forums on other stocks in the same way i saw brightcom (buy buy buy). I went and looked just now and they were in loss last year hence displaying all their ratios as NA. I don’t know anything about this company but id be wary. And regards sika… it looks safe…however historically over the past decade it’s offered the same returns as itc but without the bonus and dividends :slight_smile: … I’d recommend ignoring these 2 companies and just add a blue chip like ITC especially at the valuations it is currently trading at. No need for risk at your age

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Thank you sir, Really appreciate your reply. As Far as Ebixcash is concerned I’ve been watching the statements and earning call transcripts filed by their parent company Ebix Inc. at Nasdaq and I think they’re fairly positive on the India business and in Q1 Ebixcash (Indian subsidiary) revenue was the largest channel for Ebix Inc. accounting to 56% of the company’s total revenue.
I did have ITC in mind but considering that the returns of the company were negative from the last 5-6 years I decided to replace that with other FMCG’s. The reason for investing in 2 small cap companies is simply so that I remain closely in touch with the market.

If you have conviction then go ahead. Like I said I just heard about ebix in forums and did a cursory glance just now at money control. So you’d be in a much better position than me to judge. Also, the thing about ITC is its caused pain to its investors over the past decade no doubt… however, as of march 2020 they are finally increasing dividends and decreasing capex since majority of their capex is now over(no more hotels for a while thank god). The thing is you have to think of them as a fledgling FMCG company who have tons of cash to use from its cigarette business. It’s almost the perfect model… they print cash with cigarettes… give us dividends… use the spare cash on FMCG thay they’ve built brands over the past decade… they’ve even gone into the agro business which helps their supply chain for FMCG (the only bad use of capital imo was paper and hotels… though hopefully they have a plan for both those long term). FMCG businesses take years to get going and start getting profitable. The people holding it over the past decade felt that pain. The people buying it now are in for the best blue chip ride of the decade imo considering the free cash available and now established brands. It’s the perfect stock for me… though I’m biased since it’s a HUGE part of my portfolio.

No doubt sir ITC is a wonderful company which has given gross segment revenue growth of 4% from FMCG business in Q3 of FY19-20 as compared to FY18-19, Their growth segment in hotel business has gone up by 22% from the same period. But considering that the returns have been negative despite the fact that number of fund houses have a holding in this, it seems like the stock market has a different perspective than us on this stock. However the points given by you are completely practical and can be the reasons for viable growth of the company in future. Will surely consider it :slight_smile:

Cheers shubham. Good luck on your investing journey. At the end of the day if you pick the stocks you want you’ll have higher conviction to stick with them. Congrats on starting so early again. Your future self will thank you

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Its great to see someone with this maturity level at such less age. Congratulations. Also, nice to see you chose stable companies because at young age many would start with lookout for multibaggers. I think you are here in the markets for a very long and profitable run because of your choice.

Very interesting note on small caps. I will think over it myself. Also, one thing I want to add - you mentioned in one of your posts that you have added 2 small caps to keep you linked to the market while rest blue chip you shall buy and forget, but believe me even these blue chips will keep you very busy from time to time :slight_smile:

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Thank you sir for your kind words, Most of the knowledge I’ve gained is from reading senior members sharing their knowledge on ValuePickr. My basic goal with this portfolio was to pick some quality & established companies with predictable business models and hold them for a long period of time.

Greetings Everyone, I hope you all are doing great, It has been a month since I posted my first portfolio here on the valuepickr forum. The portfolio only contained my initial investment with only 5-10% of the allocated percentage put into each stock. Now after a month I have put much more capital into each stock than it was before and have already completed most of my investment with almost all the desired capital invested now. The updated portfolio does have a minor change in a stock. The updated portfolio along with the changes and reasons for the changes have been given below the portfolio

The only change made in the portfolio is that I have converted Sika interplant to Morganite Crucible because of the dull results and less revenue, There is no doubt that the June quarter of many small cap companies has been ruined because of the pandemic but the results of sika of the March quarter were very dull. Although this change has cost me about 12% of the total money invested in that stock. But some of the loss was covered with the dividend given by Sanofi and the rest being considered as the cost for gaining experience.
The reason why I switched to Morganite Crucible is that it has strong U.K Based parentage with great financial track record and has a significant presence in crucibles and crucible accessories. The company seems like a good bet to me with 75% parent holding and very few listed companies in it’s space in India.

Also my initial cost of some of the stocks have increased because of the rapid increase in the prices but it does not really matter much since the portfolio is a long term portfolio and I don’t mind some extra money since in the bigger picture this little premium won’t really matter much as the stocks are quality stocks.

Thanks to the valuepickr forum for great content in every thread.

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