Your stock picking strategy is buffets strategy. Actually I started with Ben Graham long back 5 years back. Then moved into Buffet. Now on Peter Lynch and Jesse Livermore. The real maturity came after Jesse livermore. Jesse Livermore teaches us how to buy at high price and sell at higher price. So slowly I moved from cheap stocks to Stocks that can get re-rated at higher price. I wait a lot actually for the price to move up a little as I did in Repco. Just to confirm if the market agrees with me. I came to a place where The moment I load a stock the stock starts moving up. Even ING Vysya Bank went up 10% after I bought but suddenly because of MSF rates and all that It went down. Now with a proper Strategy I can replicate success in each stock I buy.
“I dont decide PE of stocks, market decides, so dont have view on what pe a stocks should have. All I decide is what stocks I should buy which all meets my all of the above criteria and seems relatively cheap to me.”
The above statement makes me think that “cheap” should be the final criteria in the stocks you buy. Is that so?
What I can tell is Now It is bear market and still we find people that say things are not cheap. But what happens to them in Bull Market. Investors become impatient in bull market. Because Prices are high!! and Some actually sell off and and sit on cash. You need a strategy that works in all markets.
On 26 months Experience: Market doesn’t care. Stocks don’t move Investors experience. I think your stock picking is a skill. Not completely luck. But Luck is with you to teach you how to keep her and enjoy her!!!
On Selan: Hey You can buy any stock, irrespective of whether I like it or not.
Thanks,
Surya.
I me. 
Regards,
-Subash
Hi Subhash,
The stocks you are holding are good stocks. All the stocks except Shilpa, Selan, NIIT, Hinduja I like other stocks. Your stock picking is good. But I did not understand Why so many stocks? Alembic and Ajantha are good stock but I think Pharma stocks and IT stocks are moving up because of current headwinds. But I personally feel Ajantha and Alembic are not the stocks which should get 25 PE’s. The Problem here is in Pharma these stocks are not market leaders and don’t know how they behave in bad phases. Obviously I am not comfortable in owning stocks that are not market leaders.
And one more thing:
take a bank like ING VYSYA where the margins getting moved to 4 -4.5 will re-rate the stock to 25 PE. Things like NPA, NIM, CASA determine the overall PE. 4- 4.5 margins and 40% CASA will put ING in the range of HDFC and Kotak.
But what can bring Pharma stocks higher PE’s. The only answer I found is long operating history of growth. The point I am making here is what parameters make a pharma stock a top class stock and place it among the leaders. Because many pharma stocks are yet to come. Chronic Theraphy Area is a high growth area. In the near future there is still a lot for high growth pharma areas and domestic pharma.
Anyway if you would to comment on my strategy you can comment on my portfolio at
http://www.valuepickr.com/forum/portfolio-q-a/878769250 Link: …/…/878769250
We can have a nice flexible open minded discussion.
Thanks,
Surya.