ValuePickr Forum

Top 5 long term picks

Hello All,

South Indian Bank: WB said when it comes to bank, it is best to look at the jockeys (management)Well managed bank, modest expansion plan of 35-40 branch each year, user friendly apps on all OS, attractive PE, NIMs. Mohnish Pabrai bought it recently.

Radico Khaitan: 2nd largest liquor company. A well mangaged company than the no. 1 in the sector, the main reason I chose this. Festive season, good product portfolio, attractive valuations. RJ, Ashish Dhawan bought it recently.

Jain Irrigation: Turn around story. Strictly on basis of assumptions for a better economy. Prfessor manekar bought as big as 2% recently.

Gufic Bioscience: doubled after I bought, double PAT EPS in last 3-4 years, low PE, huge product line, constant recruitment going on.

Bilcare: Classic turn around company which will come back to its normalcy. of course for a risk taker and long term player. If I am not wrong, it is 70% down of the price at which RJ bought.

Yes, 4 of them are what the big boys bought. and it’s completely fine with me copying them as Mohnish calls himself shameless cloner. He once said that during his lunch with Munger, he was told to keep an eye on what big managers are buying…

I have few other picks as well but this discussion forum restricts to put it to 5… happy investing :slight_smile:

RJ has sold out of Radico Khaitan at a loss!!! He has sold for sure, although I am not sure if he has exited fully!

Yeps… Can confirm that he sold his entire stake in Radico!

Apologies for not updating myself and therefore the forum with wrong info.

Kindly suggest one pick for the void which will happen after i remove radico from my portfolio.

Kitex looks like the new VP stock. Other than that there are several good stocks discussed on these forums

If cloning is the parameter then Kitex fits that billas well! On top of it being a VP discussed (would prefer using the word discussed instead of recommended in the light of recent SEBI guidelines on Research Analysts)stock. Prof. Bakshi has gone long, Ashish Kacholia has also bought into it (guess he holds more than 1% now).

Cheers,

HR!

Discl: I hold.

Not to muddy the waters…but Daljeet Kohli is still bullish on Radico

Hi Partha,

I came across his article today on Bilcare http://www.moneylife.in/article/bilcares-funny-accounting-figures/38880.html

Pasting it only 'coz I saw you mentioning Bilcare in your thread.

Note: I don’t have a view on either Bilcare or Radico Khaitan. Just that, saw them being mentioned and at the same time I came across the information posted above.

Cheers,

HR!

Nikhil & HR: Ya, Kitex is a good counter but much of the juice has been drained away. Moreover, entering after 5x in less than a year?? scary !!

HG: Daljeet is an interesting person to watch out for. Sharon Bio and JB chemicals (and many others) are his latest hits. Although, Meghmani organics which was recommended by him is still flat. So one can think of taping the counter. Of course, the last annual report is of prime importance.

HR : Thank you for that article. I too read something similar regarding Bilcare. What I think (or rather speculate) is, none of the query went unanswered from their management which is a small positive sign. So I will wait for some more positive news till next quarter. One thing if anyone can confirm, whether or not, RJ still holds Bilcare? I googled but could not find any article saying ‘he sold’.

Things learned here: 1) To keep myself update with the stock news which I am holding esp when I have bought it purely on cloning basis.

  1. To remain active on forum like this to interact more with like minded folks.

You may like a certain kesar terminal (ktil) which still has lot of juice in it. Check the thread by Harbin consultants. They have definitely done a great job with their research.

Looks good on initial screening with PE, EPS growth, constant increase in annual sales and PAT. Will have to dig it deeper before concluding anything…

Thank you Nikhil.

How Radico is a better bet?

I see over the past 5 years, their operating margin has been falling(from 16% to 13%) ie., The ability to generate higher cashflows for increased sales has been decreasing. The share’s Return on Equity, CE are all just decent around 9 - 12%. Even if it is assumed to generate the returns in such a level, how am i better off than placing my investment in a Corporate bonds, which would atleast provide me above levels of returns, somewhat safer?

Company has a debt equity of 2.74 with interest cover is not that great either at 2.2. I believe it is due to their debt component in the balance sheet, the company has been poor in generating cash, as it keeps paying half of its profits as interest.

One attraction i see with this share is its current valuation. This is the same level, share was at 9 years back, 5 years back. But if i look at the historical share price, the share’s low is 56 and high is 206. I see this as a less volatile share. A high beta share at lower PE is a great investment. Yes. This is lower end of PE for the share, but it doesn’t appear like a high beta stock!

:))

Vinod: Yes radico has corrected substantially from its higher valuation level. So one can thought entering it. On the other side, Tilaknagar Industries is not bad either.

It may be noted that the dynamic CMD of South Indian Bank Dr Joseph has superannuated on Sep 30. A new incumbent has joined in his place. The Bank is a well managed Bank, but its a 1 rupee share. Better to take a view after observing the changed management.

Hi Partha - just wondering, are you still holding Gufic and if so, can you please share the investment rationale. The company looks good at outset (except for valuation) and if you have done any research which you can share that would be really helpful. Thanks, Matt

1 Like