Porinju Veliyath Goes For Jugular Of High-Quality Purists Even As Two Low-Quality Stocks Breach Circuits

Porinju Veliyath is enjoying mind-boggling success with his stock picks. Yesterday, I reported on how Ansal Buildwell, his high-conviction micro-cap realty stock, had surged 20% on the back of blockbuster Q1FY16 results. Today, I have to repeat the story because Ansal Buildwell surged another 20%. This means that in just two days, the stock is up a fabulous 44%. This is on the back of a spectacular three-digit gain on a YOY basis.

Jubilant Industries, another of Porinju’s favourites, showed its mettle by surging 20% today. The stock has gained 40% in just the last week. What caused the sudden euphoria is not known.

It may be recalled that Jubilant Industries had earlier dragged Porinju into an embarrassing situation. Porinju bought a truckload of the stock and publicly announced that he expected the management to demerge the loss making division sooner or later. To everyone’s surprise, Jubilant did just that a few days later and the stock was locked in a series of upper circuits. Some people suspected that Porinju had a whiff of the impending demerger and that he had bought the stock on insider information. Porinju was at pains to clarify that it was all an incredible coincidence and he was just plain lucky to be in the right place at the right time.

Porinju’s fascination for the so-called “low quality” stocks has put him in the cross-hairs of the purists who believe that such stocks are inherently “risky” and a “gamble” and do not make a prudent long-term investment. Neither party misses a chance to take a dig at the other whenever the opportunity presents itself.

Presently, Porinju is enjoying the upper hand. He has been fearlessly making forays into the purists’ camp and taunting them over their choice of stocks.

A few days ago, he mocked investors in Page Industries by calling it “over-priced”:

Page is over-priced unless govt makes it compulsory to wear 2 underwears, like superman 🙂 https://t.co/OVTovP99Lq

— Porinju Veliyath (@porinju) August 14, 2015

(Page is over-priced unless govt makes it compulsory to wear 2 underwears, like superman 🙂 )

Today, on the back of the spectacular success of Ansal and Jubilant, Porinju was in high spirits. He unleashed a barrage of tweets designed to hit the purists where it hurt most by implying that the purists did not know the difference between a “great company” and a “great stock”.

Great Cos may not be Great Stocks: Ashiana was 'Great Company' at ~325 in Feb, while I was buying Ansal Buildwell, a 'Great Stock' at ~70

— Porinju Veliyath (@porinju) August 17, 2015

(Great Cos may not be Great Stocks: Ashiana was ‘Great Company’ at ~325 in Feb, while I was buying Ansal Buildwell, a ‘Great Stock’ at ~70)

Porinju also leveled the ultimate insult on the purists by calling them “amateurs” for buying the so-called high-quality stocks at exorbitant valuations.

Sad that amateurs are chasing success stories at wrong prices; I have been warning about Page, Kitex, Ashiana, Atul Auto, Symphony, KSCL etc

— Porinju Veliyath (@porinju) August 17, 2015

(Sad that amateurs are chasing success stories at wrong prices; I have been warning about Page, Kitex, Ashiana, Atul Auto, Symphony, KSCL etc)

When I last checked, the purists were bristling at the ultimate insult. However, they were in no position to retaliate because Kaveri Seeds, one of their favourite stocks, which was hitherto lauded for its “high entry barriers”, “moat”, “corporate governance”, “management quality” etc, etc crumpled a miserable 16% today. In just the last week, Kaveri has lost a whopping 33%. Coming as this does on the back of heavy losses from other high-quality blue chip stocks, the purists have decided that the best strategy for the moment is to lie low and not provoke Porinju any further.