Swamiji's portfolio

Goal: CAGR of 30%

Stock identifying rules:
1. ROE for past 3 years > 25%,ROE for past 5 years > 20%,ROCE for past 3 years > 30%, ROIC > 30%,ROA for past 3 years > 20%,ROA for past 5 years > 20%& Current Ratio > 1.5 & Profit growth for past 3 years & 5 years > 20%
2. Management Quality
3. Debt to Equity < 0.3
4. Does it have the moat?
5. Promoter holding > 50%
6. P/E should be less than 40
Note: 100% compliance not needed.

Above are based on the ideas that I got from the books of Peter Lynch, Pat Dorsey etc and also based on my readings on this forum.

Capital Allocation rules:
1. Total # of stocks should not be more than 8 (Trying to take a median path between super concentrated and diversified)
2. For a single stock, maximum allocation is 30% and minimum allocation 5%
3. Approach Pharma as a basket of stocks instead of picking a single stock due to FDA approval/inspection risks.


Sl. No
Company Allocation
Pharma 30%
(Shilpa Medicare 15%,
Suven Life Sciences 7.5%,
Ajanta Pharma 7.5%)

2 Kitex Garments 20%
3 Repco Home Finance 20%
4 Kaveri Seed Company 15%
5 Mayur Uniquoters 5%
Amararaja Batteries 5%
7 Atul Auto 5%

Other stocks that I'm tracking currently are Accelaya Kale, Bayer Cropscience, Adi Finechem, Vakrangee, RS Software & V-Mart

Also waiting for compounders like Page Industries, Eicher Motors, Blue Dart etc to correct to a reasonable valuation. Looks like this will never happen :)

Request forum members to provide your feedback.

The stock selection is good. I am not sure about why Kaveri is not performing. Sometime I don’t believe in results of kaveri (how is it possible to grow 45% CAGR since 4-5 years :wink:

You can add 2-3 more stocks to reduce risk like LaOpala, Cera/Kajaria/Astral, Relaxo, PolyM

Thanks Amit.

I thought valuations were high for La Opala (65.14), Relexo (59.04) and Poly Medi (59.27).

Relaxo, now comparing it with Bata (P/E 43.75) - Bata is zero debt and has better ROE/ROA/BV. Also saw Sanjay Bakshi’s note on Relaxo when its price was around ~350. But missed the boat. :frowning:

Cera/Kajaria - I didn’t include as I thought I already have Repco which is having tailwind for the home boom and cera/Kajaria may fall on the same home construction storyline and result in duplicates. Is this assumption correct?


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