Daljeet Kohli is usually very conservative in his stock picks. He prefers to err on the side of caution rather than to take unnecessary risks. A classic example of this is the advice that Daljeet offered with regard to his blockbuster stock picks, Ajanta Pharma, Alembic Pharma and Shilpa Medicare. Though Daljeet carefully nurtured these stocks and guided them to multibagger gains, he lost his nerve when he thought that the valuations had gone beyond comfort zone. He advised a ‘sell’/ ‘hold’ of these stocks instead of advocating a buy.
Daljeet’s conservatism backfired because each of these stocks has gone on to deliver hefty gains even from there. However, it is better to be safe than sorry is Daljeet’s investment philosophy (see What We Can Learn From Daljeet Kohli’s Mistakes In Ajanta Pharma & Shilpa Medicare).
Daljeet has got into serious trouble whenever he has stepped outside his comfort zone and tried to be aggressive. Sharon Bio-Medicine is a good example of this. Daljeet was uncharacteristically aggressive in his buy call and the result is that there was a big disaster.
Fortunately, though Daljeet has demonstrated an aggressive streak in recommending OnMobile Global, it is scripting a different story.
Daljeet first put a buy on OnMobile on 3rd November 2014 when the stock was at Rs. 39. He repeated the call on 10th November 2014 when the stock had surged to Rs. 52. Later, on 9th December 2014, when the stock met that target price as well, Daljeet issued yet another buy call.
On 17th March 2015, when OnMobile was at Rs. 67, Daljeet uttered prophetic words:
“The management’s announcement of business plan to add new service line or to enhance existing services remains the additional trigger for the stock. Additionally, the cash per share of Rs.17 also bring lot of cushion.
In our view, the turnaround in operations post major restructuring looks sustainable and likely to deliver growth and profitably on back of robust business model. We recommend investors to be greedy and start accumulating.”
Daljeet’s prophecy came true on Friday, 10th July 2015, when OnMobile Global surged a massive 17% to rest at Rs. 98.
The returns to OnMobile’s shareholders, since Daljeet’s first buy call of 3rd November 2014, is a massive 151% (in just eight months).
If you look at the situation since Daljeet’s “be greedy” call of 17th March 2015, the returns are a hefty 46% for a couple of month’s work.
Daljeet’s target price of Rs. 101 is within touching distance. We’ll have to wait for an update from him to decide what to do with the stock. Stay tuned till then!