As per con call they are not making even breakeven for Nitrile Rubber even for export market. This cycle ask us to consider Apcotex as pure commodity business without any pricing power! Does it reasonable to give such premium P/E for nature of the company!
I always respect management and its vision however unless they innovate some premium product, best jockey on seek hoarse will not do meracle for us

Hey everyone. 21 yo. New here and to investing in general. Started last week only. Amazing community with intellectual folks. Learning a lot. Not sure if MF are discussed here. I have done some research and here are my investment plans. Long term plans. End goal is long term investing (10-20 years and then continue from there as long as I’m alive basically). This current plan I’m planning to use till I turn around 30-35 (around 8-13 years) so I can use investment as a passive earning. Will keep on increasing it as my source of income increase. As of now investments are around 30k pm. Here is the plan:

High Risk

13k total

In this 13k: (10k small cap funds 3k stocks)

6k sip → small cap fund. What I picked: Nippon India small cap fund direct growth (so 6k pm). Looks safe. Decent returns since 2013.

4k sip → Another small cap fund. What I picked: Quant small cap fund direct plan growth. Looks safe. Early returns weren’t good but from what I found out it got acquired post 2020 and since then it is giving some of the highest returns. Still not as safe as Nippon from what I concluded.

3k monthly → My own investment on stocks that I’ll learn. Here I’ll make a lot of mistakes hence the highest risk and lowest investment.

Will keep on increasing the above as my source of income grows.

Low risk

(17k total)

Should be super safe. Something like FD with sip if I might say. Returns aren’t the biggest priority here safety is but will be better if they can be maximised. Here, Liquid funds look promising as I can have sip there with good returns for the negligible risk they provide (same as FD though maybe a little better) but not sure if they’re the best option as they hardly beat inflation. Please let me know if there are any better options than liquid funds. Again I want almost the safest but something liquid for this that I can withdraw in case of emergency + the profit (if possible as I’m not sure if that happens). That’s why maybe fd will be better for this but they require a lump sump instead of sip.

For this will probably divide onto 2 parts again (7k for some safe investment and 10k for another safe investment but can be made liquid in case of emergency like liquid funds)
What I picked: 7k on Invesco india arbitrage fund direct growth, and 10k on liquid funds as to me it looks like that’s where only I can turn it into liquid in case of emergency not sure if it’s good for long term investments I have heard index funds like icici nifty 50 can be better or some flexi cap fund like parag parikh flexi cap but they are mentioned as high risk in various places with no liquidity option)

Please review my investment. Let me know if I am making any mistakes here I’m really new to this and wanna invest at least 30k pm. Apologies if something mentioned above isn’t correct.

Thanks!!

If India’s GDP has to grow at 6%, add 7% to 10% real inflation on top , and then management efforts like increasing branches, its really difficult even for large banks to not grow at 15%, they have to be really lousy at their job to not be able to grow at minimum 15% for next 10 years to come. Can’t say the same about IT service based giants though with all these AI threats looming.

Dhampur Bio Organics Ltd.

OVERVIEW

Founded in 1933 by Late Ram Narain Ji in a small town of Dhampur, the sugar mill started with the capacity of 300 tonnes per day. With time, the company expanded its capacity and integrated backwards to produce electricity, bagasse etc. With the new generations coming in, the Dhampur Bio Organics was finally carved out in 2022 with Mr Vijay Goel acting as a chairman of DBOL and Mr AK Goel getting the control of the Dhampur Sugars

Business Details

Not very different from Dhampur sugars, the company operates three plants: Asmoli, Mansurpur and Meerganj. The company boasts of the consolidated capacities:

1. 29500 TCD for sugarcane crushing
2. 2000 TPD of sugar refining
3. 700 TPD of pharma grade sugar
4. 800 TPD of low quality whites for exports in neighboring SEA countries
5. 3,12,500 LPD of biofuels and spirits
6. 4.2 million cases of country liquor
7. 95.5 MW of electricity generation

The value added products in the form of biofuels and country liquor is processed only from Asmoli plant. In 2022, the company crushed 43.22 lac tonnes of sugarcane and produced 3.51 lac tonnes of sugar indicating a recovery of 9.42% (since 5.99 lac tonnes of sugarcane was diverted to ethanol).

There are 2 important things worth mentioning:

1. The company has repeatedly mentioned that they are not expanding ethanol capacity yet and are in the process of evaluating dual feedstock based distillery. This would help them avoid the heat faced due to government decisions on ethanol policy
2. The company ventured into country liquor due to the fact that the UP government is having a rule to reserve some portion of molasses for open sale so that country liquor can be produced. The molasses in open market fetch Rs 470 per quintal but these reserved molasses fetch Rs 80 per quintal. In order to avoid selling it at lower price, the company ventured into manufacturing country liquor itself

The current capacity at Asmoli is a dual feed capacity where the company can derive either ENA or B Heavy or C Heavy ethanol based on the demand by Oil Marketing Companies.

The company in the last concall mentioned that at current sugar prices, the viability of producing sugar is more economical than ethanol and hence they have paused the ethanol capacity expansion

Also the company has paused converting asmoli unit to multi feed stock since due to maize price increase, the ethanol production from maize would not have been economical. This indicates a very conservative stance for the company. A tonne of sugarcane yields 116 kg of sugarcane (considering 11.6% gross recovery). From ethanol phases, following is the breakup for 1 tonne of sugarcane crushed:

• Syrup based ethanol: 78 l, sugar 0
• Sugar 101 kg, B molasses based ethanol: 21 litres
• Sugar 116 kg, C molasses based ethanol: 10 litres

We had done some calculations based on the current recovery% and by the fair guesstimate. The revenues from sugar segment only can contribute to 672 crores which is the best ever in company’s short history.

Few reasons to keep in mind:

1. El-Nino effect is prominent in Maharashtra which would transfer the demand to UP Sugar mills

2. The company will not sacrifice the production of ethanol from B-Heavy molasses which will contribute to another ~120 cr of revenues since the recovery of sugar from B heavy is minimal

3. This leads to a solid 792 cr of revenues and 2550 cr of revenue at the end of FY 24. We have considered the realization at RS 38 Per Kg. This can lead to atleast 80cr more profits than last year. Considering the current price, the stock is undervalued and can go up quite considerably.

4. Last year profits were 111 cr. This year is expected to be ~190cr

5. At mcap of 930 cr, the stock can go up by 50%

Tell me what use is holding HDFC Bank if it is not giving out any dividends?
No dividends policy is for the company which are currently in huge growth stage and can re-invest.
HDFC Bank, TCS are matured companies, and they have no short of cash. They are in the stage where they need to return money to the shareholder through dividends and buybacks.

All the smallcaps we are investing in is speculation and hope that one day once they have 10x their earnings, then they will give us small dividend % like 2-3% which would be 20-30% for us since we bought the stock when share price was 1/10.

I see absolutely no point in owning a large matured company which does not give me dividends, as otherwise my holding is just a record in demat form.