Diwali ’23 to Diwali ’24 | Samir Arora, Helios Capital | PMS AIF WORLD
In the current market condition, We are focusing on results like a hawk, and will only buy those companies where excellent growth is there.
Wherever there is slowdown, we will sell. No fuxking excuses ki we will show growth next quarter or anything.
The guy who will disappoint in results will be frustrated as after 3 years this is the first time disappointing result has came up.
Don’t buy a guy who is saying it’s just 1Q of slowdown.
Broader market rally is over now, narrow down rally will happen.
Chinese auto will certainly come in, will do JV with Indian company or Vietnam step down subsidiary.
Need to be cautious for Solar cells n modules. In China solar panels are so fuxking cheap that they are used as fencing! If chinese modules n cells finds a way to India all these players such as waaree n premier will fuxking bleed and die down totally. Chinese modules are so so cheap that it’s lying as garbage in China.
The whooping dividend received by RBI was used by the govt to reduce fiscal deficit instead of paying it to the citizens.
HUL, Nestle are saying growth is not there, middle class is shrinking etc etc. Its not like that, see the brands around you. Cottage grown, PE funded brands are coming up in all sectors. See the snacking and FMCG market, earlier there were only HUL, Nestle, Dabur now we have tons of companies making different products. Eg: see Sharktank, the numbers of companies that are coming up in all those categories.
See cosmetics, earlier there were Lakme, chamber, revnol 2-3 more; now we have 40+ brands selling cosmetics;
We can’t take the number of the legacy brands n say growth isnt there. Most of them are PE funded.
EMS: everone wants to make fridge, ac, microwave. Real manufacturers are 2-3, all brands go to them n ask them to make devices, after that THAPPA of brands come up, be it Croma, Voltas etc. Now flipkart, amazon will come in these categories.
Growth is shifting from legacy brands.
The desperate selling that happened by FII from India, the money is following not to China or not any EM, its going to America. People are forecasting Trump to win and if he will it will lead to rally in USA.
Results are very bad this season. We will be only present in the places where growth is there.
Worst possible sector to invest is Auto. EV R&D is very very huge. Budget of Volkswagen is 200 B$. Everyone is coming to make EVs, not just legacy ICE makers, everyone is coming on the bandwagon. Chinese are so fucking good in EVs. No one can compete with them. Indian makers can be protected for so so long. Chinese will somehow come. Check PE of BMW, Volkswagen its 3, 5. Like that. Tesla is feared of the Chinese competition, they are moving towards autonomous vehicles n robots. Volkswagen PE is 2.9 , BMW is 3.
We had defense n railways, but we sold post elections. And no plans to enter again as of now. If a story goes bad, it goes bad for longer time, until the next cycle kicks in.
Never buy with 3 year or 5 year view, buy with 1 year view and hope this trajectory will continue.
We will deploy fresh money where the trajectory of earnings is strongly there.
If the good earnings start to come, the momentum lasts for quarters to come and if result comes bad, it comes bad for quarters to come, momentum comes.
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