Two main updates as of today:
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I sold my 2% position in Balkrishna Industries which leaves cash of 2% in the portfolio. I bought the stock on 23th March 2020 (at around 700 level) and the stock has surprisingly re-rated very quickly. My fair value estimate was around 700 level (EV/sales of 3 times). Currently, it is trading at an EV/sales multiple of 4.5 which is on the higher side (based on past traded history). My projections for the business were 15% growth in revenues for the next 5-years which gave a fair value of 1400 in 2025. With the current stock price of 1162, the risk reward is no longer favorable, that’s why I have sold the position.
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With the sharp re-rating in PI industries, I have sold some shares at 1600 level to bring the position size back to 6%.
The updated portfolio is below:
