Aditya Birla Capital a Long term secular growth story

Stock was definitely highly Over Priced at the time of listing at 250 but below or around 200 it can be accumulated but only if there is plan to average if it go down further.I did enter in morning ,this was highest amount by me invested in a single day (aprox 2% of my portfolio)and plan to add more at lower level . This is going to be a long term portfolio stock for me.This is high price to be paid and may have to leave some appreciation of initial period but can give 15%CAGR or market beating returns in long term and fits my criteria .This is no recommendation to buy(As I am not an expert) but is my view for discussion in this forum.

 

Excellent stock pick. Stock is blue chip stock. It will shoot up like L&T Finance

 

Good pick...I too entered today in small quantities....

 

It seems price discovery is coming to end ;it may face resistance to cross 250 for some time as many investers may have been traped between 225 to250 and some of them may be waiting for exit.But long term investers should do scatred buying to avg out buying price.I expect market beating returns in long run .I have this stock in my portfolio .No recommendation to buy ;just for discussion.

 

Thankfully I did not get carried away by all the initial jazz around the stock. No need for me to average out nor become a forced long term investor (forced) just because of a high holding cost.

 

@ Kharb ji
what is the present EPS of AB Capital stock ? .... what is the Debt position ?
any information ?

 

As per valueresearch its EPS as on 31 March was 5.6.Debt for financial compnies is like raw material ,so book value is considered relevant ,its stand alone book is around 25 and consolidated book value may be higher.Any way it is over priced stock and fair value seems to be 170 but I don't feel it will go down below 180 unless market itself corrects .I am invested only for long term fully knowing it may not give returns for next two years but is a very good longer term story and is a retirement stock for me .I have already entred in a period of five years before retirement ,so would be investing in this and few insurance companies stocks which are also over priced but are good longer term retirement stocks.

 

My brother is working in AB Capital mumbai , company given 40000 shares to him in employees stock scheme
2000 shares at Rs. 10 .... and remaining 38000 shares at 120 Rs. those stocks are locking period 2022

 

If AB Capital EPS 5.6 STOCK PE Ratio is at 34.8

in my view it is very expensive , so i want to wait until corrected stock price
or it is better reliance capital buy at dips to me in financial sector ...

 

@ Sastry ji, ( @wild_hipman[/USER)----At what level I should buy AB Capital ,keeping in view risk reward ratio,if at all I decide to buy it.. Kindly guide me. Kindly brief me on why should I prefer it over Reliance Capital, or other similar companies.As I am already invested. in Rel. Cap.,hence I must have recieved A B Cap.. shares also as bonus,. but I would retain one ,either of these two. As I am just a learner in investing,I need guidence of learned investors like you, Mr Kharb,Mr Wild-Hipman. Since I intend to invest ,not to speculate, knowing WHY is crucial .

 

@Shakti ji

my view is Reliance capital valuations are reasonable than AB Capital
in NBFC sector is not in fair valuation , and market is also costly , so we have to select low PE Ratio is better

In my view AB Capital below Rs. 150 is better to start accumulating at that level based on EPS 5.6

but i think your selection Relcapital is best in this sector
De merger always give clean focus on business improvement .. so congratulations for Housing shares bonus ...

i always invest banks or financial service companies stocks low PE ratio and sales growth combination always

you think you are learner always , it reflects your obedience and learning interest in stock market sir , i think you are very experienced Investor with good skills sir

ALL THE BEST SIR

 

@RAMA MURTHY SASTRY CHALLA

when do you expect AB Capital to hit 150 levels?

The best in the sector RelCap cracks over 20% in this last one week. if best in class destroys wealth to this extent can you throw some light how other stocks from this sector have fared?

Wonder what the proponents of this stock have to say about the Relcap ride this month - a high of 880 and a low of 590 or will they again choose to disappear when its inconvenient and post only when it suits them.

 

@shakti khanduri

I have a strong dislike for Reliance Cap and everything that ADAG stands for. this is a good enough reason for me to consider AB Capital over Rel Cap. I do not believe AB Cap is likely to touch 150 and current levels of 180 do capture the erosion of the earlier rich valuations.

I have however gone in for HUDCO. Might buy some AB Cap. Not decided yet

 

earlier i am expecting correction in market in my charts i also posted , NBFC stocks are not in my priority stocks , but for employees stock option AB Capital alloted each share Rs. 125 , so it is a good price for long term investors ....

if i am not satisfied i will discord those NBFC stocks ....
mostly i want to get advantage of trading in my favorite stocks , rather than Investing
for investing it is very costly market , in my view this is only give Trading advantage market

in correction i want to buy karnataka bank and GMDC only , AB Capital or Relcapital i will look some more quarterly results also and i always follow chart anaysis , actually i will not attached to any stock in my mind ...
Basically i am a Trader , specially i will not focus on investment , some of my trading profit will convert in to investment , if market corrected drastically i will by some selected shares with my 25 % of my capital
remaining 75 % of the capital is only for Trading ....

 

Well I suppose Employee stock options are available to employees and is part of their compensation - more in the nature of bonus and used as employee retention tool. Rs125/- stock options is not reflective of true value of the company as this exercise price serves the purposes I have stated above - unless you believe that 125/- is also the fair value of AB Cap. If so, happy to hear your rationale for this - for certainly stock option exercise price does not usually capture true value

 

basically AB Capital 's details are not clear except EPS 5.6
and technically i can study with at least 6 months chart
and my assumption Rs. 125 may not correct ...for that matter
Fair value calculations in the world are deferent and not proved with accuracy also
so dont take as it is , who knows about AB Capital , it is a days baby
how can any body say about color of baby
in my priority Aditya Birla group stocks are not in my portfolio