Q3FY19 – Portfolio Performance

Market Snapshot The Nifty posted positive returns on a year-to-date basis in 2018 while the midcap and smallcap index saw a deep correction. The earnings growth remained in single digits and the PE Ratio continues to trade at expensive levels. Nifty 2018 Snapshot Most of the retail investor’s portfolio was in midcap and smallcaps. This is where the pain was in 2018. A lot of stocks had corrected by 50% (Read: Sentiments – Market correction and more) and popular names have trapped investors. Portfolio Performance The Alphamultiple portfolio rose +0.67% for the quarter. We outperformed the Nifty 50 TRI but under-performed the mid & smallcap TRI. On a YTD basis, the Alphamultiple portfolio fell (9.04%). We maintained high cash positions in the portfolio throughout the year a... Read Full Article

PVR Ltd Stock Analysis

In this blog we analyse the PVR Ltd stock. PVR (Priya Village Roadshow) operates India’s largest multiplex chain. It has ~ 625 screens in 134 theatres across 51 cities. The company has a 40% share of the Hollywood screening and 25% share of the Bollywood screening in India. Industry India is the 5th largest box office market in the world, just behind UK. India is set to overtake UK and Japan soon Hindi movies alone contribute ~ 40% to India’s box office collection. The exhibition space is still dominated by single screens although their share is reducing sharply. Single screens and Multiplexes generate 50% each of the total sales. However as ~ 400/500 single screens are shutting down every year, multiplex chains would become the major contributors. Single screens are decreasing... Read Full Article

Multibagger Stocks for 2019 and 2020

Multibagger stocks for 2019 and 2020 A multibagger is what every investor dreams of. In true sense, it is getting more than 100% returns from a stock. Usually, investors want these multibagger returns over 12-24 months. The chances of getting a multibagger are higher when the market is bullish (like 2013 to 2017). However, many times good stocks are available for fair value and this gives investors a good opportunity to invest. In this blog, we will discuss few multibagger stocks for 2019 and 2020. Disclaimer: These stocks discussed in the “Multibagger Stocks for 2019 and 2020” are on our watchlist. But, as on the date of writing this blog, none of the discussed stocks are a recommendation. We encourage all the readers to study these companies further to decide if it suits thei... Read Full Article

Swaraj Engines Stock Analysis

Swaraj Engines Stock Analysis We do a Swaraj Engines Stock Analysis to see if it is worth investing in for the long term. Predicting multibaggers is tough. However, buying quality companies at a fair value helps compound wealth. About Swaraj Engines Ltd. (SEL) was promoted by Kirloskar Oil Engines and Punjab Tractors in 1985. After Punjab Tractor’s merger with Mahindra & Mahindra, the company primarily supplies engines to M&M’s Swaraj divison. Mahindra & Mahindra is the biggest shareholder. The company’s plant is located in Mohali (Punjab). Industry The Indian tractor industry is the world’s largest by volumes, contributing 35% volume share. There is a mix of both international and domestic players in the industry. The segregation is based on horsepower... Read Full Article

Sharda Motors Stock Analysis

Sharda Motors Stock Analysis The Relan family (Promoter group), owns 73.08% of Sharda Motors Stock. The company’s Managing Director is Ajay Relan while Sharda Relan (Mother of Ajay Relan) is the Co-Chairperson. The company started operations in 1986 and has it’s presence in the Auto Ancillary space. The main products of the company are Exhaust Systems, Suspension Systems and Seat Trim and Frames. Exhaust products make up 60% to 65% of the revenues. Mahindra & Mahindra, Hyundai and Maruti Suzuki (Bharat Seats) make up 81% (Rs 928 Crores) of the revenues Earlier M&M contributed ~45% of the revenues but now the top 3 have equal contribution Auto ancillary companies have a weak bargaining power against the auto makers The company has a ~ 28% stake in Bharat Seats Ltd. wh... Read Full Article

Whirlpool of India Stock Analysis

Whirlpool of India stock is one of the finest quality stocks on our watchlist. The stock ticks of on most of the fundamental parameters. It has also posted decent growth numbers over the last 3 and 5 years. But the stock is expensive. The industry in which it operates will benefit tremendously with the rise in per-capita GDP and higher consumer spending. The current GDP per capita is $ 1,963. Different studies peg the 2023 GDP per capita to be between $ 2,800 and $ 3,300. Industry Details The Indian appliance and consumer electronics market (ACE) was worth $31.48 Billion in 2017. Smartphones made up $17.66 Billion of this market. The growth rate for the ACE industry is pegged at 9% p.a. till FY23. The volume growth in the manufacturing of the white goods is as given below. LG has a ~ 35% ... Read Full Article

Market Valuations – November 2018

Market Valuations Over the last few weeks, the Nifty index has seen a decent double digit percentage correction. The midcap and smallcap index are performing even worse. The buzz on the street is that the market valuations are at a healthy zone and it is a good time to start picking stocks. The current valuations of the Nifty 50 index are given below. The mean PE of the Nifty is ~ 19 and the index is now trading above it’s +1 Standard Deviation. The PE Ratio was at 28.55 in late August 2018. When the PE Ratio is high, the prospective returns are low even over a multi-year period. Sticking to quality stocks at low to fair valuations and a healthy percentage of cash in the portfolio can help navigate inflated valuation periods in the market. The current valuations of ~ 25x PE is stil... Read Full Article