https://www.business-standard.com/industry/news/leading-companies-line-up-for-green-hydrogen-electrolyser-tender-123120300565_1.html

I think you should start your portfolio thread if not already.
Lot of experience for all to learn from and also get inspiration for long term investing.

@1957 that’s pretty insightful. Thanks!!
I agree that REC will be trading at a discounted PE to IREDA, but the point is how much discounted PE as compared to IREDA, currently REC PE is discounted by 50% in comparison to IREDA. What does your mind say?

How I decide to hold average down when company is not performing as expected

Averaging down when only price goes down is much easier as compared when ‘bad news’ or ‘earning miss’ accompanies price movement. It becomes very challenging to take a judgement as there is a thin line between being ‘patient’ and being ‘wrong’. There are many examples where patience was not translated in desired IRR over investors horizon, at the same time there are also examples where investors have lost hope and investment idea becomes many ‘bagger’ in subsequent months. Therefore taking call on averaging down is never easy

My take –
In my view any for any manufacturing company valuation depends on assets on book + franchise value + growth value. Company franchise and growth give company valuations above book value. As an investor i have accepted the bug – Growth for the most of the businesses is non linear. That means I accept – earning up-down swings is feature and not a bug over my investment period. What decides my decision to average down or hold ( during company specific muted earning periods ) is – has the quality of franchise worsen or not. In my opinion broken franchise takes lot of time to comeback but growth comes back easily.

In my portfolio Suprajit eng being a drag from earnings point of view – i still think its franchise is as strong as before because of following reasons

1. Mechanical cable franchise is the strongest in company’s history with global presence of manufacturing, engineering and business development
2. Mechanical cable franchise is not impacted by EV with a diversified portfolio across market segments
3. Company continues to gain market share from global competitors
4. Only Hilex and Suprajit has global presence in mechanical cable space
5. Cash generation has been very strong. Company keeps generating free cash flow even with depressed earnings
6. ROE is still 12-13%

Coming to the earnings ‘Growth’ part. Why I think EPS Growth will swing back

1. The current drag in earnings is because of the newly acquired – konsberg LDC entities
2. Company has long history and track record of acquisition. Company has turned around each and every acquisition they had done in past albeit slight delay. In my book – definition of successful integration is 1)Bringing acquired company in 14-16% margin range and 2) scaling up operations. Last two acquisitions – Phoenix lamps is back to 13% margin and wescon clocked 14% margins last 2 years
3. Jim Ryan who is heading global operations wad working as a head of acquired entities before
4. Sales pipeline is very strong

@Investor_No_1
It is difficult to have this kind of portfolio with steady compounders.
This is the portfolio of mature investor who can hold onto such high ROE, high PE businesses for a very long time.
For most of us, buying low to moderate PE stocks and Selling those once overvalued with time horizon of 2-3-4 years is the norm.
Your portfolio will not go up as as much as SENSEX/NIFTY as those are mostly Low Beta stocks (except HDFC AMC, SBI Life, Mid cap IT), but during massive downfalls they will protect your downside.
I believe in the long run, if you protect the downside well, you will do better than Index.