ValuePickr Forum

Top Five Picks for long term

i)TVS Motor Company-

ii)Everest Industries

iii)HIL Limited

iv)Sesa Sterlite

v)Mphasis Ltd.

I will write about my reasons explaining why theabove mentioned five picks have good prospect in long term in the next post.

I also like Mphasis, I think they should be able to grow their non HP revenues in the long-run.

TVS Motors, exceptional management, BMW association should help. Have not looked at valuations recently.

Do you think operating margins pressure to recede in asbestos sheet industry? Not sure, if it is a structural trend, that OPM has come down significantly in the last 1-year.

If someone has to choose only one between HIL and Everest, which one would you prefer and what could be the rational?

Other than** Mphasis and Sesa sterlite** which are available at **attractive valuations **one can wait for an opportunity to buy the other three on decline;as there has been considerable run up short term correction can not be ruled out.However from a_ longer term perspective prospects look good._

In case of** Mphasis **which seeks to boost its businessother than from parent Hewlett-Packard it no way changes the shareholding oh HP.They have made several acquisitions since 2002.To me it looks like a temporary problem.

Sesa Sterlite India’s largest Zinc & Aluminum producer has been subdued due to mining ban and related issues ,with a little change in Govt. policies inrelevantsectors this company can realize its true potential.

It’s hard to differentiate between HIL & Everest but if someone has to choose only one Everest seems to have better growth prospects & more** export oriented.**

Interesting picks.

I was reading an report and they mentioned cyclicals would do well. I ran a screener with Trailing PE > 20 and Mcap to Sales < 1 and Debt to Equity < 1

It had HIL, Everest Industries, TVS motors.

I randomly choose PE > 20). I usually have a check on Mcap to Sales ratio and debt to equity.

As Peter Lynch says** ''Never invest in any idea you can’t illustrate with acrayon**." while statistics provide great basis for understanding but having an explanation why a particular company will do well is necessary.

yourvariables look good ;while many of the good companies tend to quote a high price to earning ratio but there’s a inherent risk in buying high PE important factor to be taken into account is ‘Quality of the Management’ which is hard to explain on the basis of numbers .Most of the mentioned companies would easily pass the "**management test’’;**please correct me if I am wrong.

Another important issue is **"long operating history’’ **if the company has been able to survive and grow in the past it gives me confidence.

While choosing stocks many of us try to figure out the probability of how the story will unfold for a particular company;and I personally believe this is the right way of choosing stocks.

As I have mentioned earlier some of these stocks had considerable run up andbuyingon decline would provide a margin of safety.

N.B. I have rudimentary knowledge when it comes to investing and would highly appreciatepointingout’ the mistakes ormisjudgments.


While the real estate sector India is facing problems a major reason being ‘the pricing’ a company like Everest Industries seems to be better poised for the future as they cater to the Rural Housing sector and aims to become a complete building solutions provider.

Everest Industries Rural Housing sector

I would appreciate any one points out facts that would prove my points wrong,that will be helpful in the learning process

< 1 and Debt to Equity < 1

It had HIL, Everest Industries, TVS motors.

I randomly choose PE > 20).

While the other variables look good I am personally not in favour of High PE stocks .I also believe Cyclicals will of course do well the only question is when?Regression to Mean is a very strong concept.

I have lost money in asbestos stocks about 4 years ago. They had good numbers, no debt, OK dividends etc. On top Jhunjunwala and Damani had owned these shares. I found that there is little appetite for these asbestos stocks due to regulatory risks. Asbestos is carcinogenic substance regardless of what these companies say in their annual reports. All over the world these products are banned.