Out of these, Infosys and Laurus Labs, I will be selling soon.
Posts in category Value Pickr
Usha Martin- Coming out of Chaos (28-08-2023)
I still cannot understand your grouse against Usha Martin except for the run up in prices and the valuations… Regarding benefit of doubt, what is the doubt regarding this business? Valuations is something given by markets, which is a collective wisdom of a lot of market participants.
And this ML and AI and IT companies comparision is not apple to apple comparision.
I suggest you attempt to answer the questions I put up and you will understand the transformation this company has gone through. And this transformation in business has been well received by investors and there is a change in perception towards the company.
There was a similar situation in case of Ajanta Pharma, back in 2010-11 when it used to quote at 5-7 PE for nearly 3-4 quarters inspite of consistently reporting 25-35% CAGR in profits. And once perception changed, stock went up 60 times in a matter of hardly 4 years and stock used to quote at 35 PE… That’s how markets work and that’s how multibaggers happen.
Idea should be to learn how multibaggers evolve and have an open mind without any pre conceived notions of our own.
Usha as of now might be richly valued, but when perception regarding a company changes, valuations can sustain high levels as long as growth continues, and promise of further growth is visible.
The key determinants of high PE being accorded to any company are
- Opportunity size. this provides run way for growth.
- Scalability. Here execution of management comes into play.
- Balance sheet and return ratios.
- Management quality.
- Competitive advantage.
There may be more factors at play for above PE equation, but these are the ones that immediately come to mind.
Hitesh portfolio (28-08-2023)
That’s an excellent answer. No stock tips but provide informed information which is helpful to analyse a company/or latest trend in any sector. Thanks Hitesh bhai.
Tata Motors – DVR (28-08-2023)
Hi @GourabPaul Divgi appears to be an interesting business with very few competitors in their business. Their order book, financials, previous execution everything looks good but valuation is on the higher side. If you’ve studied this company, what’s your take w.r.t valuation?
Disclosure: I’ve a invested a very small quantity in Divgi for tracking purpose.
Deep Value Portfolio (28-08-2023)
This is a very controversial selection but my 2 proposals for a value portfolio are Wockhart and Spicejet…I think these 2 are appropriate because they are both very well known brands…Of course they both have huge finance problems but their market caps reflect this…
SPICEJET is valued at 50th of Indigo market cap and yet has 1/3rd of the amount of planes of indigo…It is also a leader in carrying the poorer indian traveller an area that has huge potential in my view as train and road infrastructure still lagging compared to other countries…I feel it is a company that will always have interest from abroad.
WOCKHARDT has definitely had huge problems but still is a well known brand name and has potentially huge prospects in the antibiotic space.it also makes reliable revenues in the API space…of course it made a mistake during covid getting in bed with russians in the Sputnik area but Covid was a very stressful time for companies…
Of course neither of these companies are too big to fail but their prospective value is tremndous…
I think a lot of value companies are not value anymore after their recent rises
Caveat…I am building up a 1 crore rupee imvestment each in these 2 companies…nearly there !
IIFL Finance (erstwhile IIFL Holdings) ~ Retail focused diversified NBFC (28-08-2023)
What could be probable demèger scenario in iifl finance if it happens in future
Mudit’s Portfolio (Passively Active) (28-08-2023)
Hi Mudit
I’ve gone briefly through this topic and could see how your stock preference has gone from low growth stalwarts medium (high?) growth cos.
Just curious how your portfolio looks currently. Could you pleas share?
Of course, I’ll not take it as advise to buy or sell. Just out of curiosity
KRBL- The King of Basmati rice (28-08-2023)
KRBL buyback starts 31st Aug 2023 as opening date and closing date being 6th Sept 2023
PDS Limited – A platform for entrepreneurs (28-08-2023)
had it not been for inflation in western world, this could have been a potential rocket this year 
…
Disc: Invested