Investment strategy of Porinju Veliyath.

Porinju Veliyath is one of the most successful investment experts who is stays in the news by his surpise stock picks.I understand his investment strategy has not been properly understood by the market,including me. Is his focus on the present value or is it on the growth of the company ? Or Is he a contrarian? I hope discussions on his investment philosophy and strategy will be interesting and worth learning.Members opinions are requested for.

 

You can guess a few from this interview:

 

My understanding is Mr.Porinju Veliyath is a risk taker (as he can afford) and does not go by current fundamentals always. PV goes by insider information on the upcoming positives of a stock which is cheaply priced and go for it in truck loads. Immediate after his picking, he canvases intelligently through media about the stock, which attracts retail investors and the frenzy starts. Once the stock reaches certain level he unloads without any public information and make big bucks. There are many stocks which went up quickly and later bite the dust(under his portfolio). I advice every body to be careful and not to follow blindly, without own analysis and assessment.
Thanks

 

Will it be right to say that the hidden lesson, for small investor community , derived from PORINJU's strategy is not to trust any big name and one should be on his own.

 

This is followed by most of the so called ACE investors.
Remember dolly khanna, how she offloaded Hawkins, literally few hundred stocks s/he used to sell everyday and no one knew . Small investors usually buy such low quality stocks with news but do not know when to exit .
Thanks,
Prashant

 

I have been watching him in TV channels long before he became popular. He started downgrading when he bought Gokuldas, it is his need to attaract retail invester turn to Gokuldas from kitex. Not only porinju but almost all so called fund managers do the same. He was bullish on DLF when it was quoting 1200 in 2008 which is quoting 110 + lately because he had holding and i guess even now he is bullish and holdings in dlf!

He is the most opporunist when it comes to stock market and his political view also. Better do not go with such big fund managers as they need retailers to follow them. This is the case of much spoken stocks also.
May be I am wrong but this is what i feel.

 

If that is the reality , why read about their recommendations? I am of the view that there are some genuinely good ones & are worth following, strategy wise. We should know their name ,if possible. Can you suggest some names?One name which comes to my mind is Dr Sanjay Bukshi.

 

100% Agreed. You must listen carefully to stock idea and decide whether to go for it or not. I have made big gains by following gurus but only when I am convinced of stock's potential and fundamentals.

 

@ Mr Mukherjee- Kindly suggest some names worth listening to,which is in your know.

 

A few months back on cnbc tv18, Shri. Rakesh Jhunjhunwala was asked whether iinvestors should follow Rakesh Jhunjhunwala? He said NO. In a program on zee business, Mr. Sunil Minglani was asked " Retail investors always follow Institutional Investors and Big Investors/ Big Bulls etc. . Is it a right strategy? He said NO. He quoted a incident. One retail investor informed Sunilji that he had bought a particular stock in large quantity and wanted to know its future. When asked why he bought the stock. He replied that because LIC has just bought the stock. Sunilji asked him Are you LIC? LIC is 5000 crore + co. They can afford to bear loss if the stock does not perform. Can you? You wont even know when LIC would exit from the stock. Sunilji advised the person not to copy institutional investors blindly.

You may recall that Kharbji had once posted a message about three types of Investors.

First type ,starters and many who know that equity give good return but don't have time or knowledge to invest should always go to mutual funds.Second type is of those who has some knowledge and also want first hand action along with some thrill but don't have expertise, should stick with Quality names .They should invest aprox 40 % in Nifty compnies,next30% in BSE 200 compnies,and rest 20% in midcap but not beyond BSE 500. Not more than 10% should be beyoond bse 500 If they still want to play in Unkown smaller names can do it additionally taking exposure in small cap funds.I belong to this class.Third is Master Class.This requires high degree of knowledge,lot of time,first mover advantage in information age ,they know what they are doing ,are trend finders.They also know when to enter and when to jump out ..First type should not try to do second in hurry till they gain some experince and avoid doing third. Second type should not do third type till they are very succesful as Second type and started beating Sensex and NIFTY for at least 5 years.Third type don't need any advice but are requested to reply for benefit of first two type of investers, how and where they are investing as third type investers.

 

Further in another message, Administrator Meenakshi Razdan had made the following suggestion

I suggest you make up your mind on whether you would like to be an "investor" or a "trader". An investor will never invest in a stock without checking the fundamentals and the valuations. The investor will buy for the long-term and not be perturbed by price movements, if the fundamentals are still intact.

On the other hand, the trader will buy based on news and rumors but he will also keep a strict stop loss. He has a short-term view and will exit the stock on a slight gain/loss.

I suggest you decide even at this stage what you want to be and then take the appropriate action.

 

I think importance is not in name but in quality of stock and our belief in it. RJ may make stock recommendation which is junk and somebody small may make stock reco which is priceless. So I suggest listen to everybody and apply mind to merits of stock. I personally pay attention to Vijay Kedia, Dolly Khanna, Sanjay Bakshi, Daljeet Johli, Rahul Arora, RJ, Ramesh Damani, Radhakrishna Damania, etc. I buy stock only if it appeals to me as big gainer

 

VERY GOOD ADVICE. We Keep forgetting it

 

In the same context we should also know some of the not very familiar names of CEOs who have earned names in the corporate world in India as management's quality is very crucial essential while studying a company from investment perspective

 

investing without knowledge is gambling

 

Rightly said.

 

Not very true perception. Even gamblers use acquired knowledge .

 

"investing", not gambling, gamblers take it as their profession

 

Well Said

 

Great words. I would suggest anyone that, try to understand yourself first and how much you want from the Stock Market. Listen everyone, but act should be your own.