So First time posting my portfolio.Still learning and new . Any suggestion and view points are welcome.
Some of the positions are old which i will mention. Trying to have an ambitious target for returns of 50 % . So most stocks in the portfollio i am looking at giving returns north of 50 %.
Faze3 :- Growth stock with many tailwinds playing out including china+1, opening up of world economy(not a beneficiary of govt PLI scheme for now). New productions coming online from Q4 2022 and H2 of financial year 2022-23, doubling some of their existing capacity.They have good financial allocation mindset, venturing into better products with higher margins. Could be a doubler from here in a year. Key risks :- Raw material and energy cost might be a risk. Container disruption might also play spoil sport. Factory related risk are there.
Natural capsules:- Growth stock. The company has just finished capacity expansion and have a few more in pipeline which will double their capacity. Also venturing into API next year(applied for PLI of it also) .Niche high margin API to avoid competition from bigger players. All this can lead to 4X of their profits from here once al these capacity come online. Risks:- Factory risks, not very high barrier for capsule business.
Privi speciality:- Management has one capacity coming up online from Q4 of 2022 and another from H2 of 2022-23. These are again higher margin products and the sales of these products are already contracted.Once these capacity will be fully running their profits should jump from 50-75%. Management has guided for tripling the topline in 3 years .The stock is somewhat affected by inflationary pressure but they are able to able to pass it on with a lag. Europe and US recession might be a risk.
Vidhi speciality Ingetiants:- Growth stock, a bit expensive. New capacity coming online from Q1 of 2022-23 which will double its capacity(will be running on full capacity in 6 months ) . Management guiding for having another big additional capacity for 2023-24. In a sticky business high barriers of entery. Management has a history of making sound capitol allocation decisions. Aiming to be the top producer of their food colours and pigments in the world, right now they are number 3 .
Shivalink Bimetals:- Its an EV play.Seems like a great way to play EV theme a bit expensive.They have a few additional capacities coming up this year. Actually a beneficiary of inflation it seems. Sticky business and they seem to be eating into their international competitors market share .For a pure play EV point of view kind of cheap.Management might be announcing more capacity expansions as the demand seems to be strong.
Xpro:-Growth stock.Their business Di-electric films vertical seems to be growing in access of 35% annually. The other verticals will see a strong bounce back as the white goods demand comes back with a vengeance. Company has planned to increase capacity by 2-4x in 2 to 4 years .Prominent investors have increased stake. A company headed by Sidharth Birla. Risks:-Geting expensive, white goods related division a bit volatile.
Satia Industries:- A paper company going into recycled packaging and cutlery space.Have 2-3 new capacity coming up which would help increase capacity by 50 % and achieve higher margin.Looks cheap at current valuations. The partnership with zune can be a game changer , seems sticky but lets see what happens. A fully backward integerated player. Can check the below link for a good detailed research on this stock Satia Industries - Undervalued Multibagger Stock Below 100₹ / Highest ROCE & Great Expansion Plans - YouTube . Key risk :- debt seems a bit high coming out of covid and cash conversion cycle is high too.
Polyplex:- A great film producing company which is having 2 new capacities coming up this year. One at the start of Q1 and another from Q3 of this year. These new capacities should be higher margin products for this company. The company is a good dividend play also. The key negative is the cyclicality of the prices of its raw material . Right now they are in upswing and might remain so for a 1-2 years it seems.
Globus spirits :- An ethanol and ENA play. This is the proxy play to the alcohol and ethanol industry I feel . They provide grain based bulk alcohol, bottling service and sell their own consumer branded alcohol. They just doubled their ethanol capacity from Q4 of 2021-2022. They are trying to create a brand and sensibly do capex without taking too much debt for now . With easing govt policy for the alcohol industry and ethanol push they should be key beneficiary .Key risk :- none of these activity are sticky in nature so high competition and factory related risks are high in december their plant was affected by floods.
GMDC :- A turnaround play. The new management is getting the company back on feet. Capacity utilization can double from here.Their products prices seem to be high for the coming year at least. This might change if major world economies go into slow own.The management has appointed 3 big consultancies for improving their ROCE and balance sheet . Along with increasing their sales to major cities and industries. They have rare earths mine as well for which they have appointed a consultancy to start optimising it.This can be a game changer. The stock is cheap for now but has big run. Key risks:- government company trying to turnaround can be very slow .
Chalet hotels :- A raheja group company having hotels managed by accord group and marriot. I believe still cheap . Luxury hotel industry can go through a revenge travel phase as well as shaadi and big corporate events wave. Also forgein travel is back now which will start boosting their business further.
VIP industry:- Another proxy to tourism .A giant in it’s industry and keeps getting bigger. Expanding to other smaller neighbouring countries for more growth prospects.
Mahindra Holiday and Resorts:- A subscription based hotel play. This business model de-risks this business from some of the traditional risks of hotel industry. They have added some decent more locations and once travel comes back from this Q4 their profits should start soaring . Which should start a deleveraging cycle for the company which should lead to better ratios in the future .
Canara bank and bank of baroda :- PSU banks are very cheap, from the concall of these managements I believe they are prudent disbursers of loans as compared to other PSU banks. Beneficiary of capex cycle if it picks up .
Tata motors :- Very interesting stuff they are doing in the EV space and still cheap.They own 75% of tata technologies which i think in the grey market has a market cap of north of 50,000 crore.There are many headwinds in the form of semi-conductor shortage and rising raw material cost. A key risk might be global slowdown as well. I believe in spite of these headwinds the management has done a decent job. The push by government towards adopting EV is a plus .
Talbros automotive :- An auto ancillary which provides parts to EV mostly. Decent financials and poised for growth by going into strategic joint ventures with foreign players to provide exclusive parts to their company . At a PE below 15 seems cheap. Key risk raw material prices and slowdown in western economy. One joint venture production starts from Q1 of 2022-23 though very small but generally higher margin.There is longevity in these orders which leads to predictability of future sales.
Tata power :- One of the best renewable energy plays .They are raising capital from various foreign investors to grow their renewable business faster (black rock being one). Some of their business of EV charging station and solar rooftops have seen huge growth rates abroad . A bit expensive though .
HCG:- health care global group. The company has started to deleverage and has started a journey to better optimize their current facilities . They are specialist in oncology segment . With a lot of spending elective operations coming back and medical tourism also coming back , I believe this stock is poised for growth and cheap in valuations.
GNFC:- Re-rating finally ? The recent up move in the GNFC leads me to believe the market is finally seeing that GNFC is a chemical company and not a fertilizer company. The price of some of it’s commodity are on the rise and with the russia ukraine war may be at elevated levels for 1 year or so .China seems to be moving away from some of these commodity chemicals in the long term is also good for GNFC.
Birlasoft :- An aggressive management guiding for 1 billion dollar in topline growth for the year 2025.Attrition is a concern .
Intellect design: Doing SAAS model for the banking and insurance space seems to be playing out well. The growth rates from here can be big and the pressure of employee will not be too high.Attrition is a concern though.
Mastek:- Just entering the american market properly with the right people. If successful can lead to another upleg in their growth rates. Attrition is an issue. Valuation seems reasonable though.
Tata Elsxi:- Holding from lower levels. The demand seems to be way too strong in this sector . This has even lead margin expansion and topline growth. Which has in turn improved their ROCE and other ratios. This has also lead them to have a better grip on their employees. Highly expensive though, one can think of buying on huge corrections.
Yasho industries:- Some of the increased capacity in Q3 and Q4 of 2022 will getting optimally utilized in the coming quarters(Capacity will go from 9,200 to 12,800). Another capex will be coming live at the end of Q4 of 2024 which will double its capacity. These are all double digit margin products which should take the average operating margin of the business north of 20%. They also have a warehouse completed and running in europe now which lead to improvement in it cash conversion cycle.
WATCHLIST
CRISIL
GATI
Fineotex chemicals
DMCC
IIFL finance
Shree renuka sugars
NIIT
Goldiam international
EKI
BCG
Rushil decor (new addition)
Any views and feedback or corrections are welcome .
