In my piece of 26th July 2014, I had expressed mild surprise over the fact that Dolly Khanna aka Rajiv Khanna had bought Avanti Feeds. I surmised that Dolly is a conservative investor on the basis that she has never bought any Bank or Pharma stocks (which are exposed to RBI/ FDA risks) but has instead always bought stocks with no external risk factors (such as makers of sanitaryware, plastic, paper, cookers, shoes, etc). My theory was that Avanti Feeds is exposed to grave and uncontrollable risk factors such as disease, cyclone etc and that Dolly would not be comfortable in that situation.
Whether the theory is right or not is not known. We will have to study more of Dolly’s stock picks to reach a definite conclusion one way or the other.
The theory that Dolly has sold off her holdings in Avanti Feeds is based on the fact that her name does not appear in the list of major shareholders as of 31st December 2014. It is possible that Dolly might be holding on to some shares. However, given her pattern of making investments, this appears unlikely. Dolly is either wholly in or wholly out. She does not believe in half-hearted measures.
Dolly has made quite a packet from Avanti Feeds during her short stint. Assuming she bought her chunk of 91,500 shares on 15th May 2014 (mid-way in the April to June 2014 quarter), her purchase price would be about Rs. 535. Assuming she sold her holdings on 15th November 2014 (mid-way in the October to December 2014 quarter), her sale price would be about Rs. 1809. This means that Dolly has raked in a mammoth 238% in just a couple of months.
What Dolly has done with the sale proceeds is another issue of great interest to us.
The information available up to date shows that Dolly has bought a chunk of 3,82,454 shares of Asian Granito, a micro-cap, in the December 2014 quarter. The investment is worth about Rs. 6.11 crore at the CMP.
We need to keep a red alert to see if Dolly has made any other additions to her portfolio in the December 2014 quarter.