Vimal's Portfolio

Iam posting my holdings with request to esteemed seniorvaluepickr’s specially Hitesh / Aayush / Donald / Abhishekand others to comment please.

Have always tried to restrict no. of holdings to six with a certain part of portfolio allocated to MF to attain required diversification.

Current holdings:

Mayur - 65%

Gujarat Reclaim -5%

Atul Auto - 5%

Balkrishna - 3%

Hawkins -3%

Muthoot Capital -2%

VST Tillers -1%

HDFC Equity Fund - 10%

Cash -5%

Pls comment,specially should I convert MF holdings into high conviction ideas.


I think concentration in Mayur is too much. No matter how good a company is one ideally has to restrict the percentage allocation to a particular stock to less than 30-35%.

This is not to denigrate Mayur or its prospects.

Stock selection is good and you can increase holding in any of your high conviction bets at the cost of some mayur and even hdfc equity fund.

Thanks Hitesh, agree about allocation

what I see in Mayur currently is potential triggers in short term coming out of increased margins from backward integration and again out of increased proportion of exports once orders with new customers get finalised which I understand from some other forum are at negotiation stage.

but yes this aberration do exist though may be for short term.

Totally agree with, Hitesh :slight_smile:


thanx a lot Aayush.

Hi Vimal,

I am the least qualified to make comments/suggestions on anyone’s Portfolio. simply because my experience base is just 2 years - in thinking about Portfolio, allocations, and/or making refinements.

This is the reason I have been shying away from making any comments anywhere. But your 65% allocation to Mayur - was provocation/enticement enough:)

1). Anything beyond a 10% allocation - even for a very aggressive risk-taker - MUST be from his/her own CONVICTION in the stock )- which will come from extensive homework- knowing all that is there to know about the company and its business, the industry. Seeking out others who may be are invested heavily in the stock - sparring with them on possible holes and/or negatives, and regular monitoring of the business performance. Challenging others to attack the stock -play the devil’s advocate - why woudn’t you allocate more, etc.

It should never be because Junta says so. or so & so ace stockpicker says so, or a couple of them say so. Wisdom of the masses is generally to be distrusted.

On a lighter note -The overwhelming ValuePickr (Portfolio) vote on Mayur sends me a signal - its time to reduce my allocations:).

2). If you cant do your own Homework - Aggressive Portfolios are not for you. If you CAN do your own homework, then that’s great, and I may like to differ with Ayush & Hitesh - theoretically, speaking:). There can be no blanket statements, Let me explain how & why.

If the Portfolio uploads/discussion could have been structured, I would have asked for a couple more (vital) additional information.

1). Equities allocation - as a percentage of Networth

2). Other Assets allocation - as a percentage of Networth (e.g. Debt Instruments, Gold, Real Estate,etc.)

3). Your assessment of your individual risk-taking ability (life’s lessons,etc.)

Let me put things in perspective with a real case: Mine

I am what others (my friends) call an aggressive risk-taker in Life. But the way I look at it is I am a calculated Risk taker. I am able to assess my abilities, and generally set myself slightly stretched targets. If I know I can achieve 5/10, I will set myself a target of 7 - because achieving 5 I know is a done deal, its actually under-achievement for me.

So I will calculate that the odds are stacked in favour of me if I attempt 7 (because I am growing stronger, I am practicing hard, I am increasing my stamina, I am growing in skill every day) but if I attempt 8 or 9 definitely the odds are stacked against.

Coming to Portfolios, Less than 5% of my Networth today is in Equities (at Market Value). Another 5% is in Debt Instruments. Balance 90% is in Real Estate - again by a fortuitous turn of events, beginners luck, whatever you may call it.

So it’s no great shakes for me to increasingly bet 28% of my Equity Portfolio (at cost) on Mayur. As I kept doing my homework, and my my conviction kept going up, and the company kept performing, (and none of the skeptics could meaningfully puncture my conviction), I kept finding that the calculated odds are inmy favour, so I kept increasing my stake.

Also, in my view, there was no other contender then to beat Mayur in the CONVICTION vs UNDERVALUATION multiple (See our Capital Allocation Framework thread, for details). Now I think, there are others like Astral Polytechnik and Kaveri Seeds to challenge that pole position held by Mayur. I have a big hunch that these two currently are better opportunities than Mayur, and if I do not reallocate I will be paying some Opportunity Cost. I have to devote time, asap, to validate/reject these hunches thru some data/projections/analysis homework.


1). Assess your Equity Portfolio vs Total Net Worth

2). Know Yourself - What kind of a risk-taker are you - Do you like to take calculated risks in Life, or you generally play safe. Will you have the stomach to bear a 20% or more (temporary loss) for a larger gain

3). Be HONEST(to yourself) - about the homework you have put in. Vs the Risk you are taking. Do you really have that CONVICTION. if yes, then you can ride out even 2 years of underperformance.

Suggestion: Even if your answers to CONVICTION is High (Highest) and answers to Equity Networth % is less than 20%, and answers to RISK taking ability is YES - I know myself well and my abilities well, **I CAN take calculated risks **(proven in other spheres of life than just equities), you will still be well-advised to pare your 65% allocation to Mayur.

We must be open. We must be humble. Despite all our work, things can go wrong which are beyond anyone’s control. We cant rule out a catastrophic event at Mayurs factory, or in the Artificial leather industry. Or even more simply we might have been just wrong, missed some real big hole or failed to assess the impact of an ongoing development/shift in the company/business/industry. Mr Market always knows, better!

So there is Wisdom in the adage of spreading the bets. Generally folks like to spread their bets among 20-30 stocks or more. That is a damn good strategy maybe for passive investors.

But For Active investors (like you) and who prefer a concentrated style (like you), have above-average risk taking abilities (I am assuming like you), have more than 50% of Networth other than Equities (I again am assuming like you), I would say 50% allocation may be in Top3, and balance 50% in the rest 3-7 stocks may not be a bad idea, provide this is backed up by serious, serious homework. Then you might be able to really leverage the benefits of a Concentrated Portfolio.

Disc: My views are not to be taken seriously; these may seem logical, but are purely theoretical -these are yet to be validated over any bull-bear-bull cycles to give any level of confidence to anyone. I pursue a high-calculated-risk strategy as Life has been kind to me; If and when I do receive big blows, these views are surely subject to change;)

hi donald,

very well said indeed!!

your love for mayur is well known :). what makes you think at this juncture that astral and kaveri may be better oppurtunities?


As I mentioned Hemant, purely Hunches at the moment. I have to play with the data/project & analyse and build logic supporting the hunches. To be able to communicate/transfer the change in CONVICTION.

My Hunches are usually strong - backed up by some feel for the overall picture;). The size of the Market/Opprrtunity is the largest for Astral …and folks don’t/can’t seem to agree with me, but hey Astral has much better competitive advantages in its industry (than say Mayur), I strongly feel its a much better bet over the next 5 years. Same with Kaveri Seeds (yet to develop much CONVICTION here, pending the MAngement Q&A sheduled for last week Sep), but it has solid solid IPR! And a big market ahead.

Key takeaway from Donald’s post above is the % of Equities investment to net worth.

All should take note of this. Gold and RE investment should be as conscious and studied investment as equities.

Wow, super post Donald, this one’s gonna be high up in the list of advices pertaining to asset allocation and portfolio analysis.

Diversification in terms of asset class is the key. Also varies with age, risk perception, earning power and market opportunities that exist. For someone in 2007 to start off with either in equities or real estate was suicidal to their networth.

However, for the salaried class with proper analysis of one’s risk taking ability, equities are one of the best platforms with scope of incremental investments in the most structured manner.

Remaining invested for the long haul and keeping the focus intact is the key, as numerous greats have repeatedly emphasized the difference between short term profit booking and long term wealth creation.

As mentioned by Prof. Bakshi in his interview,


You just have to see how people have got rich in stocks. If you look at genuinely
successful people in the stock market, you will find that an over-whelming majority of
them bought stocks of good companies at attractive prices and just sat on them for a
long-long time.[/quote]

We really need to focus on investments where we can sit on them for really long periods of time and do not need to book profits in the gambit of opportunity cost.

Will be great to know the views of seniors in this regard.

Hi Donald,

Never ever in my wildest dream I have thought you would have just 5% of your networth in equity. Yourself/Hitesh bhai + few more folks are amongst us, the best equity investor in valuepickr. Feel amazed by the fact that you are spending so much effort for 5% of your portfolio. If I were you, I would have created a site for real estate investment rather (90% portfolio).

Regarding Mayur, I beg to differ from you. The management track record, high ROE/ROCE, low PE, super huge opportunity in varied segment (automotive, footwear, handbag etc) makes it number 1 investment opportunity at present. Agreed that post sharp run-up it is consolidating in and around 400 for a long time, but the upside is huge. This might be only stock where I can put 50% of my money and still have a sound sleep at night.


Again a powerful and thought provoking post as it has always been from you. And just on time when my thinking was getting biased that equities are a better option to invest in than RE if it is possible to get ~30-35% CAGR, which looked and looks possible after reading this forum with the added advantage of no requirement of lots of money upfront.

Thanks Donald for thought provoking write up, made me step back and re think.

As I mentioned concentration aberration did exist at that point of time. after Hitesh’s comment’s have gradually started prunning mayur holdings to desired level.


High less than 20%, ** I (proven**

Hi Subash,

Again this not by design, but by luck/default.

I made a single very high-value bet in 2000 in Real Estate (something 90% of my friends, well-wishers advised against). That multiplied 6x in 4 years (market, paper value if you like), and is now 10x the initial investment by now. Obviously I had the luck of timing with me - anybody who invested in anything in RE in 2000 timeframes has a big multibagger in his hands.

I had no idea of Equities that time (fortunately) but had the confidence to see extreme value - just the ticket size was 2x normal budgets in those days. I reckoned we were a DINK then, both my wife and me were working in high-paying jobs, so we can pull of servicing the high-value high-interest loan (13% fixed) with relative ease, even if one us lost our job or had to quit;). Calculated-risk-taking at play! Pity is everybody agrees now, what a NO-BRAINER opportunity that was!

Looking back I can only say I clearly saw extremeHigh-value and High Conviction in the capability of the Builder to deliver the promise (10% of project in place, I was in the last 20% of folks to get in). Never predicted the windfalls, if I could I would have sold myself and bought two of the same.

I know these type of baggers come once in a life-time, so I am not dabbling in RE (as you logically suggest). If I do that, I know I will destroy value…this one is for keeps…even if it compounds only at sub 10% levels from here on. Form current RE valuation levels anywhere in the country, one can only hope for normal 15% kind of CAGR, unless you are in Mumbai or NCR maybe…or unless you invest in a super-exclusive property that kicks along as hyped…and that too will be a big ask!

Equities I got interested in 2005 when we got twin blessings in 2004. Interest rates were 7% floating then. Money in the bank was earning negative return adjusted for inflation. So I started educating myself with lots of hard work, and small amounts of money -as I increasingly found I am really passionate about understanding businesses, and separating the Wheat from the Chaff!

If I overlook the RE, it is a significant amount of money that I have put at stake. (My wife is always petrified of my high-risk strategies). The attempt is to make that 1 or 2 or 3 high-value but calculated-risk bet in the next 2-3-4 years. This will require extreme effort, upping the learning curve steeply - helped along by lots of smarter people around you, and a fair bit of luck or intuitive hunch (on where the odds are stacked), backed up by serious, serious homework.

I am not that smart. I can only attract smart folks around me if I work very hard to keep pace and surprise them once in a while, so they find value in working as a Team. ValuePickr is that extended Team. Lots of good folks are joining the effort recognising that - complimentary skills in a team - in a harmonious environment - channelised towards common-shared goals, is what delivers consistently superior results. Individual brilliance, however smart, is no match to that! In any field of human endeavour, except may be fine arts:)

And this time round we are focused on making everyone understand what, an unbeatable combination of High-Value x High Conviction business, can deliver.

If I had even half-understood the power of this in '2000, we would have floated a private REIT:). Now with such a talented hardworking Team behind it, ValuePickr definitely intends to float an Equity FUND (maybe PIPE or Closed-ended) in 5 years!!!

So that should explain the hard work, so much of effort for 5% of Networth:). Does IT???

Re: the Mayur challenges, will take it up in Mayur’s thread shortly.

Nice discussion here, so let me pitch in with my 2 cents

1). I think, the worth of the primary house (in which one lives) should not be given much importance in the calculation of how much of one’snetworthis invested in equity. The logic being, if something goes wrong with the equity portfolio, the networth of the primary house is not really readily available for investing in equities, right ? If that can be done, then it’s a different matter.

2). One’s equity investing has to fit in to one’s overall grand strategy for wealth generation , liquidity position as well as sleeping well in the night. If one is really well to do, and already holds a diversified portfolio of property/business/etc… then it’s, fine even if one put’s 50%+ of one’s equity portfolio in one single equity as long the total equity portfolio is just aminusculeportion of one’stotal networth.

3). I think for small investors , it makes sense to first take care of 1 of the basic of 4 unforced errors as illustrated by Prof Bakshi in the 37th article here (Asset Allocation)

4). I am a small passive investor from a salaried backgroundbevelingin long term wealth generation through equity investing. Over the next 10-15 years creating an equity portfolio of 50 times of my then comfortable annual expense is my goal. I hold 25+ companies in my portfolio.