Vipul Patel Portfolio

I started investing in 2003 and like everyone else, paid tuition fees in 2008 crash.
Came across The Equity Desk in 2009 and trained myself by reading any books that I can find on Finance, Investment, Economics and Psychology. Apart from that many blogs and online sites, podcasts, videos and Valuepickr forum had been helpful

Current Portfolio :
I was born and raised in Gujarat. I have been in states since 2008 so portfolio also includes US Equities and Crypto Assets.

Indian Equities : 61%
US Equities : 18%
Crypto Assets : 5%
Cash : 16%

Since Valuepickr is Indian dedicated forum, I’ll discuss Indian stocks here.


Holding Period :
PNB Housing Finance and Power Mech Projects more than an year
RBL Bank bought after IPO listing
Prima Plastics more than 3 years [Reduced holdings to 1/3rd at around 6 bagger]
Equitas Holdings, Sintex Plastics, CCL Products and Byke are recent buy.

In Recent correction, many stocks corrected and provides good opportunity.
Few Quality stocks that I am researching and interested in :
Acrysil ltd
Thangamayil Thingamob
Sharda CropChem
Kitex Garments
Shilpa Medicare

I was active in Valuepickr earlier but was busy with family and job so had been visitor later.

Any quality views,comments,criticism and thoughts are most welcome


Can you please share your thesis behind each of these names. Maybe a short description for the same.

Concentrated Vs Diversified Portfolio

As you can see highest holdings in my portfolio is 15% and lowest is 3%
I don’t have strong opinions on portfolio strategy of concentrated Vs diversified.
Definition itself is very vague - Are 12 stocks considered concentrated bets or 3 stocks?

As an investor, I focus on value [along with growth] and allocate capital accordingly.
It can happen that some stocks may be found cheap and end up forming big part of portfolio.

At what point does it dilute returns?
For me, My time is not worth with holdings less than 5%. Hence I follow simple rule - After buying small quantities, If I can’t allocate >5% of portfolio in stocks within few months of my initial buy, it shall be sold.
That helps me to focus on increasing allocation in existing holdings rather than spreading myself wide and thin.

I try to typically balance higher allocation holdings with another stocks.
For eg: PNB housing finance forms 15% in portfolio so to balance that holdings, I have second best bet Power Mech Projects with similar allocation.
Idea is if #1 holdings fail, then it can be compensated with performance of balanced bet.

If stocks with 15-20% allocation fails, then it’s very hard to get compensated with small allocation stocks [eg: <5% holdings]

Most companies has dedicated thread on Valuepickr but here’s quick thesis

PNB Housing Finance : 35-40% Grower with decent management in good sector. Decrease in cost/Income ratio will help boost ROA.
Good Industrt Tailwind with subsidy on interest, tax benefit, RERA, etc.
Downside - With too many players, it has been competitive and RBI also raised concern on housing finance.

Power Mech Projects : Earlier company was hit badly due to overrun of domestic projects. All those projects are closed now so margins in domestic business will improve. They started getting decent international business with great margins too.

Increase in high margin projects along with 15-20% sales growth, this company can still surprise positively.

RBL Bank : 35-40% compounder with good management. After exiting from IndusInd bank due to size, I needed another compounder to replace. That’s when I found this gem. It’s buy and forget stock.

Equitas Holdings : Good Management with decent growth. Management smartly increased non-MFI [mainly secure lending] business in last 2 years. MFI book is 28% of book and will decrease to 20%. Focus is on increasing secured lending. Market is not valuing this business properly - Just look at valuation of other SFBs focused on secured lending.
It shall grow at 35-40% book for next few years with low opex ==> Decrease in cost/Income ratio and hence profit shall increase disproportionately.

Byke Hospitality : Quality company with decent management and valuations. Only Challenge is growth. Management kept on targeting higher number of properties, rooms through leased or franchise option. Somehow it didn’t work out well so far - Hopefully with turnaround in hospitality sector, they find their mojo back. I am ready to give some more time.

Prima Plastics - I allocated decent money on this one at Rs.50-55. This was also part of bull run and crazy valuations as part of small/midcap frenzy cycle. I sold majority part of portfolio - reason to keep small allocations is their big expansion in Cameroon and India.
They ended with very high Inventories and debtors along with debt. That’s risk along with oil prices

Sintex Plastics - Management had been working hard to restructuring business and focus on retail and high margin products.
Cutting down on infra business, paying down debt, increasing retail products. These will help increase bottomline. Decent sales growth of 15% can have magnifying impact in bottomline. With increase in EBITDA margins and decrease in interest and dep. expenses, bottomline is bound to grow much higher. Management subscribed to warrants at Rs.90 so their incentives are rightly aligned.
It’s huge bargain if they walk their talk.

CCL Products - Good business and good management but okay valuations.
New capacity addition, increasing margins, focus on building domestic brand and above all this is STICKY business and very hard for customers to switch.
This one still forms 3% of portfolio as I am not convinced fully on valuations.


Vipulbhai, you have a good portfolio and you have conviction on the stocks. That is the key to it. But, here are my suggestions:

  1. Add stocks that have a good dividend yield so that you will have some cushion to your portfolio and also generate income while waiting esp. in the sideways market moves (like right now).
  2. You have small and midcap names and no large cap names. There are themes to these stocks, and in 2008 when you gave your subscription fee, you would have noticed that people who were holding the small and midcap stocks would have given a higher proportion of fees!
  3. To lower the SD or Beta of the portfolio, you would want to add stocks like HUL or ITC or RIL or ABB or LnT or other Nifty ideas.
  4. Ensure that you are displaying the US and Indian portfolios separately since lots of investors here are into Indian stocks and not as much into the US names.
  5. Your US names are also very unique names so you are really into ‘special situations’ (it appears) since I am not familiar with a lot of those names except HDB.
  6. Glad to see that you are into Crypto Assets which might be through ETN/ETF which would be good so that you are diversified instantly.
  7. Ideas like Sintex Plastics is challenging us, so giving the SIP a bit of time is helpful instead of doing it within 2-6 weeks and then not having the patience to hold the ‘high conviction business’ regardless of what the market does with the stock (like the downward moves in Sintex).

Hope this helps.


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Thanks KKP for comments!

I don’t believe in focusing on dividend yield stocks or large caps.

Here’s reason:

Dividend Play : I don’t see any high growth company at high dividend yield. Those are typically laggards or value trap. People end up focusing yield of 3-4% at cost of growth. Opportunity cost is single most important. My focus is mainly to get companies growing at >25% at reasonable valuations. Even Quality growth companies at low yield can provide great returns.
I don’t mind buying high dividend yield company growing at >20% either. Let me know if you know any :slight_smile:

However high yield can protect downside but no upside either.

Large Caps: You are right - large caps provide stability to portfolio but I am ready to trade stability with volatility with better end results in long run. As we know, biggest money is made in small/midcaps.

I love high volatility and low risk combination. It was very difficult to digest daily volatility at the beginning of investment journey but it doesn’t impact a bit now.
Since I am in US and sleep early, I don’t look at stock prices during trading time at all and have sound sleep. That’s helping a lot to digest volatility. Basically I make money while sleeping - Classic Naval :wink:

As Mr.Buffett says, Volatility is not risk but chance of actual capital erosion is biggest risk.

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Thoughts on Banking/NBFC Stocks:

I was thinking on banking/NBFC stocks recently and here are few thoughts.

From last few months, we have been observing market focused on Financialization of Saving theme. As part of theme, many of finance stocks - Private Banks, Money Lenders NBFC/SFB, etc are near all time high.

However, there are many players in same sector trading at 3-4 years low. eg: PSU banks, Few Private banks, MFI focussed SFBs, etc

It’s very interesting to see that stocks in same sectors are showing different behavior.

If financials has to be sector leader in bull market, then all stocks including duds has to be part of run but it doesn’t look like.

Business Model : I am really intrigued on business models of banks and NBFC.
Their raw materials and end products are MONEY.

Who doesn’t need money? Hypothetically they can grow at ANY rate since customers looking for product [money] are easily available.

Hence if management is not prudent in risk management, they can easily bankrupt company since banks are levered at 10x equity.

That’s enough to wipe out capital at NPA of 10%. Many decently management banks/NBFC went beyond 5% already in recent times.

No wonder Kenneth Andrade and Prof. Bakshi are staying away from sector.

But then question is how can we ignore “Financialization of savings” sector growing at decent rate and hitting fresh highs ?

Vipulbhai, the problem with midcaps that give small dividends or no dividends is that they go through a high ROE/ROCE, and then they become large caps. That is when they spew out good / better dividends so that it can entice holders to hold for a long term and reduce the volatility.

Everyone wants CAGR of 20% and 30%, but those stocks go through phases of that growth and as a result, phases in their stock performance. Not saying HUL and RIL don’t do it, but while they are doing it, they are giving you a ‘rish-waat’ to keep you from jumping off the train (which is dividends).

MFs will hold these stocks forever, and LT holders like me will hold it forever.

HUL> Perfect example of a VERY poor performer from 200 to 300. 5 to 10 years or irritating a lot of people. But, gave the "reesh-waat’ to have me keep in the portfolio. Even I got tired of holding and started selling 100-300 shares here and there at 300, 350, 400, 450 and 500. At 500, I stopped selling. And, look at the High PE stock, become an Olympian stock and is trading at 1700. Will it stay here? No. But, it was way way way over-valued at 300 to 500 and it is still overvalued. Was this a 20%+ grower? No Way. Is it now? Somewhat!

RIL> Same story. Tested the patience of all of the Retail Investors, gave out dividends to keep our mouths shut, and today it is THE LARGEST holding bar none with #2 position way way below. Will it take a hit? Hope that it will come down by 20% or 30% for many to jump on the train. Was this a 20%+ grower? No Way. Is it now? Somewhat!

Time time ke baat hai…Business Cycles are hard to guage and can only do so much for you. After that, one has to invest and sit.

Older than Buffet is the guy who said “Money is made not in timing, but time in the stock” and Buffet has copied it by holding the poorest performer of his portfolio American Express till today and it is hurting. Coca Cola is another L.L.T holding of his and he is suffering for more than 10 years also on it. BUT, is he holding it. Yes. Eating the dividends!!! Yes.

Hope this gives you some ammunition, and all of the above is what I have experienced and not talking 0.1% theory.


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You can buy secular stories within finance such as life insurance and AMCs which do not have problems of lending and npas…tbey have their own problems but are more steady machines…u can check US listed amc and insurance companies…well run ones will become bigger than banks in next decade in india is what i believe