In an interview to Business Line, Porinju Veliyath extolled the virtues of a concentrated portfolio. He said:
“I love a 10-stock portfolio. We have around 650 clients and the average number in a portfolio will be 10 stocks – you can say it is a concentrated portfolio.”
He repeated this in an interview to NDTV.
However, the intriguing aspect is that Porinju is not following this principle in his personal investment portfolio. In fact, on most days, Porinju’s name crops up in the list of bulk deals for buying some random micro-cap stock or the other.
| Company
|
Type |
Date |
Quantity |
Av.Price |
| Abc India Ltd (@) | Buy | 06/Jun/2014 | 27356 | 102.2 |
| Linc Pen & Plastics Ltd | Buy | 25/Aug/2014 | 85000 | 88.23 |
| Samtex Fashions Ltd | Buy | 18/Sep/2014 | 77527 | 42.95 |
| Harrisons Malayalam Ltd | Buy | 30/Sep/2014 | 100000 | 72.19 |
| Stylam Industries Ltd | Buy | 13/Oct/2014 | 50000 | 89.49 |
| Izmo Ltd | Buy | 26/Feb/2015 | 100000 | 36.4 |
| Bdh Industries Ltd | Buy | 25/Mar/2015 | 45942 | 42.84 |
| Simran Farms Ltd | Sell | 08/Apr/2015 | 60000 | 41.1 |
| Jubilant Industries Ltd | Buy | 05/May/2015 | 60000 | 100.96 |
| Jubilant Industries Ltd | Buy | 13/May/2015 | 60000 | 169.97 |
| Palred Technologies Ltd | Buy | 27/May/2015 | 200000 | 23.55 |
| Samtex Fashions Ltd | Buy | 08/Jun/2015 | 77473 | 70.32 |
| Izmo Ltd | Buy | 11/Jun/2015 | 65000 | 38.57 |
| V2 Retail Ltd (#) | Buy | 22/Jun/2015 | 126459 | 39.54 |
| Sahyadri Industries Ltd | Buy | 09/Jul/2015 | 50000 | 86.42 |
| Izmo Ltd (@) | Buy | 13/Jul/2015 | 70000 | 54.21 |
| Archies Ltd (#) | Buy | 20/Jul/2015 | 200000 | 28.23 |
| Gokaldas Exports Ltd (@) | Buy | 22/Jul/2015 | 200000 | 67.81 |
| Arvind Infrastructure Ltd (#) | Buy | 11/Sep/2015 | 160000 | 35.59 |
| Alpa Laboratories Ltd (@) | Buy | 06/Nov/2015 | 110000 | 31.3 |
| Globus Spirits Ltd (@) | Buy | 24/Nov/2015 | 155000 | 66.3 |
| Tera Software Ltd | Buy | 08/Dec/2015 | 65000 | 75.27 |
| Tara Jewels Ltd | Buy | 15/Dec/2015 | 150000 | 52.64 |
@: Shilpa Porinju Veliyath, #: Sunny Porinju Veliyath
You can see that in the period of 18 months from June 2014 to December 2015, Porinju has bought stocks in 18 companies, being ABC India, Linc Pen, Samtex Fashions, Harrisons Malayalam, Stylam Industries, IZMO, BDH Industries, Jubilant Industries, Palred Technologies, V2 Retail, Sahyadri Industries, Archies, Gokaldas Exports, Arvind Infrastructure, Alpa Labs, Globus Spirits, Tera Software and Tara Jewels. There is only one bulk deal sale during this period, namely, that of Simran Farms.
The total funds invested during the period, after deducting the sale, are in excess of Rs. 12 crore.
Whether Porinju is still holding all of the aforementioned stocks is not known.
Prima facie, one explanation for Porinju’s ‘shotgun’ approach of spraying his funds across a number of bulk deals is to take advantage of the excitement that the bulk deal purchase generates amongst retail investors. In the wake of the news of Porinju’s buy, investors throng the counter and send the micro-cap stock rocketing to the upper circuit for a couple of days. Porinju may be taking advantage of the higher prices to gently offload his holding and pocket a tidy profit.
There is nothing wrong in this modus operandi if it is indeed being followed by Porinju. Porinju has not recommended anyone to buy the stock nor has he given any assurance that he will hold the stock for any period of time. It is perfectly legitimate for him to buy the stock in a bulk deal on day one and sell it quietly on day two in a regular sale.
In fact, this modus operandi (if being followed) is a highly profitable way to leverage the huge popularity that Porinju enjoys amongst the masses.
The problem is that novice investors associate Porinju’s purchase as the discovery of a stock with great fundamentals and cheap valuations. They buy the stock for the long-term and may get saddled with a junk stock once the excitement peters out.
The other explanation is that Porinju is indeed a believer in the fundamentals of each stock and that he does intend to hold them for the long-term. The ‘concentrated portfolio’ theory may not work with such stocks given their inherent low quality.
A third explanation is that Porinju does both i.e. he buys some stocks because he believes in their fundamentals and he buys other stocks to take advantage of the resultant excitement.
The third explanation appears to be the most rationale one for Porinju contradicting his own assertion of being a concentrated investor!
Wow! Amazing stock picks! Look at the performance of the stocks as on today instead of trying to speculate on his intentions. Just imagine about an investor who bought all these stocks after him even at a 10-20% higher than his price, its a profitable investment as on today – after 6 months, 12 months and 18 months. Congrats to Porinju – u are amazing!
Why Is Porinju Veliyath Buying So Many Stocks If He Is A “Concentrated Portfolio” Investor? ANSWER FOR THIS QUESTION IS ALREADY EXPLAINED HERE BY ARJUN HIMSELF
Prima facie, one explanation for Porinju’s ‘shotgun’ approach of spraying his funds across a number of bulk deals is to take advantage of the excitement that the bulk deal purchase generates amongst retail investors. In the wake of the news of Porinju’s buy, investors throng the counter and send the micro-cap stock rocketing to the upper circuit for a couple of days. Porinju may be taking advantage of the higher prices to gently offload his holding and pocket a tidy profit.
Porinju has recently bought Tara Jewels. It looks very likely to continuous circuits till about 80-90 as it is a very undervalued stock. Swarovski has invested in Tara Jewels at around 222 3 years back.
well he is a market participant …. he is following the concentrated approach in the pms portfolio ..
and when you are a trader cum investor you must take advantage of near to medium term developments in the companies ..if you can analyse that and bet on that nothing wrong in that ..
in all the above stocks there is some or other development taking place ..
in a bull market it happens that the fundamentals and technical heat ups and there are so many investment / trading candidates .
do your home work and enjoy the ride
Vijay
He take the advantage and making profit at the cost of blind followers simple.
Arjun, you seems to be messing up with his statement of ’10 stocks concentrated Portfolio’ about PMS with his personal trades and investments. I was just going through his trades listed by you, have to admit it as outstanding – around 50% annualised return on an average (including few non-performers) while Indexes have been flat to negative.
The blogger has made a huge compliment to Porinju sir by presenting his 18 months picks (only bulk deals) considering their outstanding performance in a muted market environment, though the intention of the blogger looks like to tarnish his clean image
very well said, but one request mr.porinju veliyath should discuss some stock buying in public as well as to buy some stock 4 his followers, because media plays vital role in all kind of areas,why because every one knows
Instead of talking abt is bulk deals had u all have think abt when he is offloading stocks from this portfolio. SEBI must put some regulation on block nd bulk deals after Someone buy. Means if he buy some stock their must be some time period after tht only he can sell that stock
good idea but diffcult to make sure 4 SEBI
I am his client and its true that he has made Concentrated Portfolio for me of only 9 stocks. Great Job by Mr. Porinju.
Stock investments are now FREE at Zerodha in India. Just click link to know below to know more about it and fill your details in the form. Person from Zerodha will call you. https://zerodha.com/?c=ZMPCM
Hi Renuka,
nice to know you are porinju,s client
would you share with us the percentage of returns that he has given you yearly from the time of investment.. not asking you to disclose your investment amount.. just to have an idea of how good his returns are…
with respect to the discussion on porinju’s stock…. logically it would be impossible to buy long term stocks without trading in any… and wait for them to give returns… obviously he has to produce profits for his clients… to me he has a stock portfolio for trading and one for long term… this helps him to make cash both for himself and his clients
money begets money… the more you invest the more you make.. so he has the advantage of 350 crores while we as individual investors can hardly compare with him.. a single digit increment in stock value would make him lacs as he buys shares in lacs… and for the man who buys 10 stocks would hardly make ten rupees to hundred rupees…
lastly i dont think he needs to create the hype to fool his followers… but all of them trade … this is my belief…. and some have said so openly….and obviously will not let us on to their secret trading stratergies
he also has thirty years of experience and walks talks and sleeps stocks… so he also has this uncanny 6th sense to pick up good stocks.. also to pick up stocks that may not be good enough but will rake in a few lacs per trade…
How i wish i could be successful like him and all the great names on the stock market….
these are all ‘khujli stocks’
Who is khujli stocks , where can i find his stocks ?
Lol
If you stop publishing articles related to him, you did yeomen service to people.
For several weeks, you highlight him as a wizard, one day you publish these articles.
stop being a parasite on others (in your words…stock wizards)…do hard work and in-depth research on companies but not on people.
That will help you in long term.
You are right Sunil.
I am just imagining the day Midcap Stocks Crash.This Silly Porinju (really looks like a Joker to me than an Investor) wont even get an exit from his stocks.
He buys most of the Rubbish stocks citing some or the other investment Rationale which to me is insane .I hope the Bear mkt doesnt make him a laughing stock.
Hello Mr Viral! Please change your name to virus! Suits you better.
You do not know a thing about Mr Veliyath. He is the only market guru from whom thousands of investors have benefited in fact.
But it is fine to be jealous of him.
Great Picks
Arjun proved that he is not promoting any one in his blogs. He is expressing the thinking of many readers of the blog.I was one of them confused with the up going of Alpa Lab. We cannot blame Porinju if he is doing this. Responsibility is ours to be Cautious, not to do any thing blindly. Any way I think, Porinju should replay to this, the reason to buy these stocks because he is not an ordinary person but, having about 20000 followers, if not, will be responsible for the loss of his poor followers. I believe, he doesn’t want to be known as a ‘traitor, in future.
Caveat emptor
I think Porunju style works only in start of mid cap rally in market .Now that rally is already two year old.So it will be realy curious to know thät Porunju change his style ,or got trapped in last end of mid cap rally and keep on showing his bravery. Now from fun,it will be adventurous game with lot of pit falls.
Mostly the investments by such experts are “Talk Fundamental … Follow Technical” approach. Nothing wrong. But the message should be clear…
Excellent post. I often wondered why suddenly a value investor is buying 100s of stocks in a month. Recently he even suggested Idea and AB Nuvo, where is the value in telecom with jio launch?
The great investor buys and holds and holds and the stock rises and rises and rises
Money may be raining on him due to his recent popularity. He need to invest them at right place.