continued…
Valuation wise, the steel-mill is due for demerger and is worth between 15-25k Cr, with a good up-cycle, it may be valued at ~20k Cr. That accounts for half the market cap of the company.
The rest is then the mining biz, which means it trades at 2x sales and if this is a long iron ore cycle (the trend is still positive) then the forward PE might (at current price) be ~2.5.
Iron ore price issue is simply explained in the AR of sept 2020 by NMDC. Brazil is having severe issues, likely the dam collapse resolution is complicated by covid. Australian supplies, the biggest by far, by cyclones, which due to increasing extreme weather (due to global warming) might not be easy to solve. Their mining ports are not that great harbors, and looks like ships cannot be loaded in such conditions. Might also be an excuse to throttle China.
Also, seems like India is more accessible then Brazil. Australia has some of the worst diplomatic relations with China and it looks like they can get worse. Mining conglomerates have been questioned pointedly by China for lack of capacity. Looks like India may be better placed to fill in a gap here.
1 Like
Bajaj Health launches Favipiravir
2 Likes
Another launch from Bajaj Healthcare targeting COVID treatment: (really opportunistic and flexible for adding growth levers, adds to conviction about the management quality)
1 Like
Latest folio status:
| Company name |
Last price |
Cost per share |
% of Total |
Return % |
| Pokarna Ltd. |
252 |
163 |
16.0 |
55 |
| Shakti Pumps (India) Ltd. |
538 |
532 |
10.9 |
1 |
| Vipul Organics Ltd |
173 |
120 |
7.3 |
44 |
| Laurus Labs Ltd. |
487 |
170 |
6.7 |
187 |
| Manorama Industries Ltd. |
930 |
683 |
6.4 |
36 |
| Bajaj Healthcare Ltd. |
628 |
467 |
6.1 |
34 |
| Bajaj Steel Inds. Ltd. |
594 |
451 |
6.1 |
32 |
| Kanchi Karpooram Ltd. |
1183 |
395 |
6.1 |
199 |
| Kopran Ltd. |
190 |
127 |
6.0 |
50 |
| Filatex India Ltd. |
102 |
75 |
5.8 |
35 |
| Dynemic Products Ltd. |
511 |
391 |
5.4 |
31 |
| NMDC Ltd. |
185 |
156 |
5.3 |
18 |
| RACL Geartech Ltd |
247 |
252 |
4.2 |
-2 |
| Asian Granito India Ltd. |
156 |
157 |
4.1 |
-1 |
| GNA Axles Ltd. |
360 |
402 |
3.7 |
-10 |
Past few weeks as updated here before, mainly reduced from Vipul organics and added to Asian Granito, Filatex and NMDC in that order by time.
Tracking preference is more towards mid-caps now, rather than the overload of micro caps. But will stop diversification for now, since doubled the number to 15 holdings in past 2 months.
Overall, 8% gains in past ~3 weeks, at ATH again, mainly helped by some new entrants and pharma pack. Kanchi and Bajaj steel helping too.
The past year trend:
PS: I guess it helps to be bit aggressive/make hay while the bull run lasts, so that average longer term returns are still in comfortable range, even when the cycle inevitably moderates/turns. Keeping in mind, the strategy should switch to defensive with such a phase seen oncoming.
9 Likes
Sir
Why you have moved from. NBFC MFI stocks??
Specially Arman and spandana sphoorty?
Thanks
Hi Kuldeep,
No sir plz! I was just trying to follow some advice from Hitesh sir actually, he had predicted to stay away from fin stocks, I think, since leveraged biz can always face difficult times. Just personal opinion of course, it might be also good time to think contrarian, and buy more! My mind-set is more impatient, sorry to say, and if some stock is not moving for months then I feel there is opportunity cost.
4 Likes
UPDATE:
Sold out Kanchi, majority moved to Pix transmission (5% worth of folio), and a little back to Vipul organics.
Have held Kanchi for 3+ years, from 200 to 1200, it has been a good ride but the record margins of the past 2 qtrs. will be difficult to match for the next 1-2 years, and it is best to go out on a high. This threat was the reason for 80% of it being sold out 2 months before. This has been my biggest money maker, about 14% total amount being contributed. It took patience but never did see much of the gains from the capacity expansion, which was the initial theory for sitting tight, for years. You have to acknowledge lucky mistakes. It might still do well with many factors being difficult to consider. Preference is for lower overall holdings.
Pix was always on the buy list but mistakenly preferred GNA and RACL, some two months ago, which have actually seen some negative effects from the auto slow down due to lockdowns and perhaps chip-shortages worldwide.
9 Likes
Hi, vikas.
What is the reason for taking a position in pix transmission?
Hi Hemanth,
Steady performer for years, expansion in the works finally, going live in 10 months and quite cheap. May benefit from China+1 sourcing, have good distribution for exports.
3 Likes
Bajaj health seems to be technically poised to clear a double-bottom, interesting fundas:
- Analyst meet few weeks ago followed by record volumes.
- Launch of 2 corona drugs.
- Guidance was already upbeat in last quarter.
- Seems relatively cheap.
6 Likes
Hi Vikas any view on heramba industries
Dear Vikas,
Thank you for sharing your portfolio here.
Why are you not holding Acrysil, even though you are following it? Any negative thoughts on it?
Disc: Invested
Thanks,
Anto
Hi Anto,
Welcome! It is mainly for discussion purpose and sharing of ideas.
Acrysil is a good stock, but I am trying to keep my total holdings between 10-20, towards the lower range. So, have to leave out many tempting ones also.
It has a good moat and decent growth plans and a tie-up for supplies to IKEA. Bit fairly valued but the entire market is giving very less cheap opportunities. It is still on the safe side and growth can be decent.
I already hold Pokarna since a year now and recently added Asian Granito. Pokarna might be targeting the same product market, though it looks like they might only be doing basic washroom sinks and not the large kitchen variety maybe. No details available yet. But, these two are a very large part of my folio and based somewhat on the quartz related, export-oriented theme.
Cheers!
Vikas
2 Likes
Hi vikas
R u tracking hind copper. If so your views please.
Also on Sasken technologies if you can give your views.
Thanks
Hi Ganesh,
Indeed, thought of investing in hind copper, twice around 140 then 120 levels. My folio style is with less diversification, I am trying to add more actually to include opportunities like these. How I consoled myself is that I do not think high commodity prices will last multiple years, even though rise in copper is the best bet among all. I remember the previous highs a decade ago, stabilizer transformers simply switched to aluminum conductors (all our V-guard are working perfect), so copper is replaceable. Yes, copper resources are less/restricted. Aluminum conductor of slightly larger thickness will exactly have the characteristic of Copper, except it has bit more thermal expansion etc. Hind copper is very weak, structurally, they sought merger with NMDC, to survive. This may be old-story since now they did QIP for expansion. Story is not that rosy, IMHO, and looks roughly priced-in, to a great extent.
Sasken no clue, I stay away from IT stocks, since cannot make difference between tom, dick and harry, they look all the same to me. They did have a good run, due to rupee depreciation, lower expenses due to WFH and more digitization work coming their way. Only the last factor remains, the rest two will reverse, IMHO. It maybe a factor big enough for the party to continue, but industry is very competitive, I have heard good things about Sasken but cannot comment further in any detail.
Cheers!
Vikas
PS: My thumb-rule is to think of 50% upside from entry, within a year (or bit longer but at the same rate), trying to make hay while the bulls run 
(considering low downside and high gains probability, of course)
3 Likes
Hi Vikas,
Any thoughts on EV sector and its relating stocks like Exide Industries, Amara Raja Batteries, Tata Chemicals, Tata Power & Tata motors to name a few.
Thanks a lot in advance!
Hi Srimanth
I would like to bet on Tata’s for large scale execution of EV. Personally not thinking that long term, my style is to stick to opportunistic bets for roughly about a year, keep holding longer if the story keeps playing out.
Exide keeps reporting plans, maybe weak on execution historically, but looks like some production lines are about to start soon.
I hear Greaves cotton is focusing on EV motors. Not researched though!
Cheers,
Vikas
2 Likes
Hi Vikas,
Are you tracking Aluflouride? If so, what are your thoughts please?
