When Nalanda Capital stormed the Cera Sanitaryware counter in January 2014 and bought a massive chunk of shares, a lot of investors were taken aback. Cera was considered to be quoting at stratospheric levels then and there were murmurs that the stock was over-priced. So, why would Nalanda pump in more funds to increase its holding in Cera, investors wondered.
However, now, with the benefit of hindsight, we can see how much of a visionary the wizards in Nalanda Capital are. They were able to correctly assess the long-term capability of the stock given its market dominance and the huge scale of opportunity. They were not deterred by the price of the stock. The stock is up nearly 145% since then.
The same can also be said for Dolly Khanna and Vijay Kedia who have entrusted a huge part of their wealth to Cera. These visionaries are early investors in the stock and have earned a massive fortune from it.
Basant Maheshwari also advocated a buy of Cera on the same premise i.e. that the growing affluence of the middle class means that consumer stocks like Cera would do well.
Daljeet Kohli is an astute stock picker who does not miss out on such opportunities. While Daljeet did not pick Cera Sanitaryware, he recommended its peer, HSIL.
Daljeet and his band of faithful followers have also reaped a rich harvest from HSIL. From the first recommended price of Rs. 136 in April 2014 to the CMP of Rs. 391 is a gain of 186% (in just 6 months).
Now, Cera’s spectacular Q2FY15 results have prompted Daljeet to issue an update on HSIL in which he says:
“CERA Sanitaryware Ltd – Stellar set of Q2FY15 results | Rub‐off impact on HSIL
Rub‐off impact on HSIL
However, we expect the same trend to be visible in HSIL –building product segment. HSIL has also been focussing on value added products and lowering its power costs by usage of alternate fuels. It has been improving its EBITDA margin of building products which stood at 22.8% in FY14 against 20.5% in FY13. At CMP of Rs 373, HSIL trades at PE of 22.8x and 14.6x FY15E and FY16E earnings of Rs 16.4 and Rs 14.6 per share. We maintain our positive stance on HSIL with a BUY rating and SOTP based target price of Rs 425.”
Apart from Cera and HSIL, if you are looking for a stock that the savvy investors are bullish on, you can consider Ashiana Housing which boasts of having won the confidence of stalwarts like Nalanda Capital, Prof. Sanjay Bakshi, Ashish Kacholia etc. Daljeet has recommended this stock with convincing logic. Yet another stock is AIA Engineering. It has one of the largest confluence of savvy investors you can find in a stock. This stock comes highly recommended by the charming Vineeta Mahnot of Hem Securities & Ekansh Mittal of Katalyst Wealth.