Considering recent rally in this stock it has given good returns ,but as it said u need to have a sound exit strategy ,on basis of this logic such a stock after reaching at 100 PE should be exited at current price or should wait for the vstop to get negative in order to take a sell call depending on technical analysis.
Plz give some guidance regarding this any senior members who practice technofunda approach.

when it comes to travel, the two Jim Rogers book one with motorcycle and one with his mercedes, combined finance with travel nicely! Always enjoy your summaries and find new books had not hit upon yet! Thanks.

Welcome to the forum. You are in the right forum at a very young age, that is good.

There is no safety in equity, even with MFs. MFs too lose money, the NAV can fall by 20%, and if we don’t want to sell, then we have to wait for longer periods. Better to have a number in mind and time period in mind, because it is volatile, there is no compounding here, the returns are not linear, they are volatile, it goes up and down, what good it is if we want to withdraw and the NAV is the same as 2 years ago, because it has fallen and not yet moved up. Direct equity is an ocean, so it will take time.

Go through freefincal.com for MF related things, it helps.

Invest in debt, if you are concerned about return and safety. And if you think of emergency, split the investments into different products, along with a debt fund, you can go for RDs, keep some in the bank account, keep hard cash too, because in emergency, liquidity is important, we will need cash. With debt funds, there could be limits for instant redemption, and redemption requests may take 2-3 days.

In the initial years, keep it simple, don’t think about returns and focus on learning. And as time passes, with the gained knowledge, and with the capital from your profession, you can do a lot of things, so focus on your profession too.

I had always wondered about this contradictory behavior of returning cash to shareholders via dividend and then raising additional capital by diluting shareholders. Dividend payout ratios for ICICI, HDFC have always been much higher than Kotak which had promoter shareholder who was more aligned with shareholders. Dividend yield for large private banks has been around 1-1.5% where as for Kotak it was around 0.07% so big difference of 100-150 bps vs 7 bps.

I think this behavior is explained by looking at the management incentives. Banks are typically valued at BVPS. When large private sectors banks prefer to raise funds when are trading at P/B of 3-5 unless they are forced to raise funds at lower valuation. Suppose bank BVPS is 100, P/B of 4 (share price of 400) and bank has 100 shares outstanding and. When they issue dividend of 1 then updated BVPS is 99.

Now bank issues 1 share at 4 P/B so updated share count 101. Earlier total book value was 100100 = 10,000 now new book value is 100100 + 1*400 = 10400 so BVPS is 102.97 and now Raising money at P/B > 1 raises book value. Increased book value with same multiple leads to higher share price. 102.97 * 4 = 411.88 (price bump from 400)

If you look at history of growth in the book value of HDFC Bank then you can see book value increasing 3-4% every quarter from net income and also increasing in larger step whenever they did share issuance (typically every 3-4 years whenever price was suitable)

This benefit starts to dilute when P/B decreases towards 1 and reverses completely below P/B of 1.

LME Lead pricing