Is valuation favorable now?
Posts in category Value Pickr
Phillips Carbon Black (02-04-2024)
Integration of the acquisition is a key item to monitor in the coming quarters. Any positive management commentary regarding the integration can be a potential trigger for the stock since analysts have been skeptical about the management’s ability to execute large acquisitions.
JTL Industries – Fast Grower at an inflexion point (02-04-2024)
From April 24 JTL will also implement same tech.
Special situation (demerger, rights issue, delisting) – checklist (02-04-2024)
Today, on listing of South Indian Bank Rights Share I got really surprized when I didn’t find the shares in my demat account. So I contacted Upstox and they are saying that the shares are lying in my holdings and are not listed by exchange whereas today on 2nd April 2024 the rights issue has been listed. Now they are saying that shares are listed today but it shall reflect not earlier than tomorrow i.e. 3rd April. To what extent they are right?
Yogesh Portfolio (02-04-2024)
How do we establish if these numbers being reported by management and their commentary is for real? And if they are for real how much of the narrative is sustainable or already in the price?
Their revenue and earning performance before 2020 are nothing to write home about, being flat for 6-8 years. Sudden 10x increase in revenue and PAT, in just 3 years, should lead to even more due diligence. If their business just caught the sectoral tailwind then is this remarkable turnaround in their financial performance sustainable? Can they withstand next downturn cycle which is typical of commodity stocks?
They make the same products as other dozens of listed players. Operating margins are much lower than peer group and they only went up due to higher top line growth. Valuations already look very stretched, compared to industry and peer group average, and that too at the top of bull run. Main promoters have sold quite a lot of shares in the last quarter (good timing before 34% correction).
I have been following steel tube/pipe industry for quite some time and every time sector goes through a bull run, it seems permanent what with exciting order flows and feel good factor all around… But I have realized that only thing permanent with this sector is cyclicality and reversion to mean of stock prices. It’s very important to time entry and exit to make profit and avoid getting stuck in a downcycle for a very long time.
CAMS – Indirect Bet on Financialization? (02-04-2024)
Insurance Regulatory and Development Authority of India(“IRDAI) has notified the Insurance Regulatory and Development Authority of India (Protection of Policyholders’ Interests and Allied Matters of Insurers) Regulations, 2024 which has mandated
the issuance of insurance policies by insurance companies in electronic form with effect from 1st April 2024.
How will this benefit CAMSREP and the Bima central platform they are trying to establish? Requesting senior members to share their thoughts.
Regards,
Suhag
CMS Info Systems Ltd (02-04-2024)
CMS has added some marquee investors when Sion exited.
| Name | Avg. Price | Quantity |
|---|---|---|
| NORGES BANK ON ACCOUNT OF THE GOVERNMENT PENSION FUND GLOBAL | 386.33 | 21,84,806 |
| ELIMATH ADVISORS PRIVATE LIMITED | 378.82 | 8,50,000 |
| MORGAN STANLEY ASIA SINGAPORE PTE | 370.05 | 8,69,145 |
| IIFL SECURITIES LIMITED ERROR ACCOUNT | 370.05 | 12,16,050 |
| MATHEW CYRIAC | 370.67 | 12,82,000 |
| SANATAN FINANCIAL ADVISORY SERVICES PRIVATE LIMITED | 375.50 | 10,00,000 |
| THINK INDIA OPPORTUNITIES MASTER FUND LP | 370.05 | 13,81,667 |
| WF ASIAN RECONNAISSANCE FUND LTD | 370.05 | 26,25,167 |
| INDIA ACORN ICAV | 370.05 | 10,39,700 |
| ABU DHABI INVESTMENT AUTHORITY – WAY | 370.05 | 8,46,560 |
| NOMURA FUNDS IRELAND PUBLIC LTD COINDIA EQUITY FUND | 370.05 | 43,10,617 |
| AIG GLOBAL INVESTMENT CORPORATION (ASIA) A/C AIG GLOBAL FUNDS-AIG INDIA EQ | 370.05 | 12,50,000 |
| ICICI PRUDENTIAL MUTUAL FUND | 370.05 | 15,00,000 |
| ICICI PRUDENTIAL MUTUAL FUND | 370.05 | 12,16,947 |
| ICICI PRUDENTIAL MUTUAL FUND | 370.05 | 9,46,514 |
| ICICI PRUDENTIAL MUTUAL FUND | 370.05 | 19,47,116 |
| KOTAK MAHINDRA MUTUAL FUND A/C – KOTAK SMALL CAP FUND | 370.05 | 36,25,712 |
| GRAVITON RESEARCH CAPITAL LLP | 385.99 | 8,36,705 |
| SOCIETE GENERALE | 370.05 | 7,90,833 |
However, the stock has limited visibility amongst the broader analyst community. The presence of such investors which should hopefully improve visibility in the coming quarters.
Smallcap momentum portfolio (02-04-2024)
“let me ask follow up question…how this method can be improved/tweaked for bear market/sideway market.”
Momentum, by definition is following the trend, in this case, the automated approach helps in identifying the best among the lot.
In bear markets, when you get to the irrational extreme, it will be prudent to book out of momentum and chase good stocks whose valuations must have corrected.
Remember, there is a very thin line between momentum and trading. Momentum is a systematic trading whose gains can be fed into core portfolios when the valuations are reasonable.
Long answer short, donot try to perfect this method for bear markets, instead work to build on good watchlists which can give you a wide range of shopping options during bear phases