SIP in direct equity (self managed MF!)

Q&A: Questions & Answers
1

Hi All,

So May 2014 has been a good month for India (election) and personally for me as well (Landed a new job.)

Now I am planning to infuse the 'pay hike' into equity through SIP. So I have two options -

1) Equity MF

2) Direct equity - Manage my own equity MF ;)

Following is the planned investment. I would appreciate any comments/suggestion for modifications/brickbats.

I have also provided my current portfolio for reference.

Stock Allocation Comment
Astral Poly 20% Astral is already my largest holding @ ~18% of my portfolio. Should I invest more?
Atul Auto 20%
Repco 20%
VST Tillers 20%
Ajanta Pharma 20%

- Valuation of page has always deterred me from entering it. A good candidate for SIP?


My current portfolio is as mentioned below

Stock Allocation Comment
Astral Poly 18.70% 1-Core
Mayur Uni 11.49% 1-Core
Selan Exp 11.47% 1-Core
Cera 9.56% 1-Core
Kaveri Seeds 6.93% 1-Core
Supreme Ind 6.57% 1-Core
Atul Auto 4.01% 2-Want to Make Core
Ajanta Pharma 3.92% 2-Want to Make Core
Repco Home 3.75% 2-Want to Make Core
Shilpa Medicare 3.68% 3-Hold
Mirza International 3.02% 3-Hold
Alembic Pharma 2.75% 3-Hold
IndusInd Bank 2.59% 3-Hold
Orient Cement 2.70% 4-Opportunistic Bet
KNR Construction 2.66% 4-Opportunistic Bet
Swelect 1.62% 4-Opportunistic Bet
Gulshan Poly 1.81% 5-Token
Poly Medicure 0.79% 5-Token
Amara Raja 0.71% 5-Token
VST Tillers 0.64% 5-Token
Liberty Shoes 0.64% 5-Token
2

Apologies for creating two threads, by mistake, for same content. Any way to delete this thread? The second thread has minor correction where I have put ‘VST Tillers’ in ‘2-Want to Make Core’ category!

3

Aah… realized that the other thread also has VST Tillers as ‘token’ investment! Anyways, I want to increase holding in VST Tillers to make it one of the core holding over a period of time!

A few more points:

)- I know all the stocks are mid-caps and no large-caps and the thought process behind the choice is that ‘perceived risk’ of mid-cap gets compensated by the ‘low risk’ of SIP. Open to large caps though!

)- In my current portfolio, the stocks in ‘3-Hold’ category are definitely good to make them core holdings but then I want to limit core holding to 10-12 stocks and hence decided to hold them and increase allocation further in the ‘2-Want to Make Core’ category!

)- The ‘opportunistic bets’ are positions taken in infra space after election results!

The intention of categorization is to unclutter the thought process and not get confused about ‘what to buy now’ every time I want to invest some amount. The categorization clearly tells me to invest into the stocks in category ‘1’ or ‘2’ to consolidate my core holding!

4

Any comment/suggestions from the members?

5

Very good portfolio Sarang.

I think Astral is very expensive now and I feel appreciation can be better in other stocks like Cera or for that matter good stocks like Eicher

6

Thanks Abhishek,

I agree on Astral’s valuations. But I am thinking in 5-10+ years timeframe and from that perspective the potential market opportunity excites me. I feel this is just the beginning in terms of adoption of the kind of products astral makes! They do not have any significant competition in market! Having said that, I am afraid that I may be heavily biased towards Astral - that being my largest holding… and hence the dilemma!

After all, it is very easy to get carried away in this kind of a market! :slight_smile: