Narayana Health and Cera and the top of my watchlist and I will look to add them at right valuations and you will hear more about them on this thread as and when I develop insights on business
In terms of allocation, the important aspect which I consider – apart from business, management and valuation ( which are all forward looking)- is : whats the maturity of historic data in terms of giving quality signal
More the matured data, I believe better is the quality and that’s why I am comfortable with larger allocations. I think – auto ancs, branded pharma and building materials have higher maturity of past data and thats why portfolio allocations will be higher
Hospitals – past data is not yet matured to my comfort and thats why allocation will be at max high single digit
What improves the maturity of historic data in my view
- Higher the number of past business cycles for the sector
- Larger number of listed players in the sector
- Sectors having large cap listed companies
The drawback of this thinking is – i have to let go all upcoming sunrise sectors like – defence, electronics manufacturing etc. – which leads to extremely large level of FOMO
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