[sgiitk]

Originally Posted by ajmat

Well I bought into Tatamotors, a couple of weeks back and already made a 6% gain. You need to pick companies about to make a big leap or something where they have made a miss (Mahindra are done but they will claw back).

The issue is will the market go higher or correct. There are always stocks which may go the other way.

Nobody knows, only think I can see is some softening of interest rates in expectation of a dropping inflation and a rate cut sooner than later.

[VindyWheels]

Hi Swift,

I do not have any names for next 6-12 month horizon. For long term I have already mentioned numerous names that I like in this thread.

Originally Posted by swiftnfurious

Mind shedding some names?

[manduvindupondu]

Only the Nifty 50 companies and a bunch of BS 200 (Business Standard) are at their 52 week/life time highs. Many mid cap stocks are still at 2009 March (Lowest in recent years, when Nifty was at 2300) levels.
This is just a liquidity based rally and market is going ahead of fundamentals.

I may incur an opportunity loss but I am fine with it. Recovering lost money is very very difficult. Missing opportunities are fine, as they are many.
Btw, It is just my opinion. I am not pessimistic or too conservative.
I bought Adani at 180 rs per share (In 2013), Infosys at 2800 (In 2013), DLF at 107 (recently), bought numerous other companies in 2014 (When Nifty was at 7700 recently) and traded multiple times on Financial technologies .

But I feel the current rates are too expensive. I will wait and watch.
Co Team-Bhpians, eager to read your comments.

[Ravijai]

Hi Vindywheels,
Your posts are truly enlightening for novices like me and I have developed a likening towards CCL products and initiated positions (it started with your posts and confirmed by my own research). I am sure it has the potential to minimum double from here in FY17.
Whats your ID in Valuepickr, would be good to follow you there also :-)
Keep posting!

[VindyWheels]

Thank you Ravi. I hardly post in VP now but is definitely active in the background, taking part in management Q&As.

Yes, CCL definitely looks good. Now-a-days all the investments I am making have a decent normal valuation for their usual business and has something "extra". Kitex has high valuation for normal business but has two "extras" - US foray and merger with KCL. Moldtek packaging has normal business growing well with decent valuations, but export segment and new product experiments can positively surprise (just started buying Moldtek). Zen Technologies' India business looks great with a neat "extra" available with the Rockwell partnership (I had bought Zen at 268 levels).

In CCL the extra is the Indian branded play. My last visit to Hyderabad confirmed they are more widely present in good supermarkets. The management confirmed they are confident now and are expanding to other parts of the country. I am clear about the competitive advantage of this company now.

Nestle has some 75% market share globally enjoying anywhere near 80% margins! You might say they reached there through marketing and brand building, but its not just that. They reached there due to product superiority too. Getting the right blend is not easy. In each step from selecting the beans there are parameters. That's why globally Nestle never outsourced production except when an aberration happened in the 90's...did a bell ring? Now that same company is probably the only one which can make good quality products and give some competition. The reason CCL is able to pass on raw material price hikes to its clients is due to the high margins at the top. If nestle has 80% margins, CCLs clients have 50%! They can absorb cost increases passed on by CCL. Not only that they can't risk going to another supplier. They invested time and effort in working together with the QC team of CCL, got the blend right, marketed the product in their markets and now cannot afford to step out of the relationship. As the CCL MD puts it - "relationships play very important part in this business".

I am fairly certain that CCL will get a small share with own brand in India. Nestle cannot lower the price and compete as they will lose much more doing that. Whom ever I asked vouched that the CCL "Continental Premium" coffee tasted better than Nestle.

I had met the managements of CCL, Zen and Moldtek last week and have invested in all the three with considerable allocations to CCL and Zen.

Cheers

Vindy

[Lalvaz]

Originally Posted by VindyWheels

In CCL the extra is the Indian branded play. My last visit to Hyderabad confirmed they are more widely present in good supermarkets. The management confirmed they are confident now and are expanding to other parts of the country. I am clear about the competitive advantage of this company now.

Nestle has some 75% market share globally enjoying anywhere near 80% margins! You might say they reached there through marketing and brand building, but its not just that. They reached there due to product superiority too. Getting the right blend is not easy. In each step from selecting the beans there are parameters. That's why globally Nestle never outsourced production except when an aberration happened in the 90's...did a bell ring? Now that same company is probably the only one which can make good quality products and give some competition. The reason CCL is able to pass on raw material price hikes to its clients is due to the high margins at the top. If nestle has 80% margins, CCLs clients have 50%! They can absorb cost increases passed on by CCL. Not only that they can't risk going to another supplier. They invested time and effort in working together with the QC team of CCL, got the blend right, marketed the product in their markets and now cannot afford to step out of the relationship. As the CCL MD puts it - "relationships play very important part in this business".

I am fairly certain that CCL will get a small share with own brand in India. Nestle cannot lower the price and compete as they will lose much more doing that. Whom ever I asked vouched that the CCL "Continental Premium" coffee tasted better than Nestle.

I had met the managements of CCL, Zen and Moldtek last week and have invested in all the three with considerable allocations to CCL and Zen.

Cheers

Vindy

Thanks Vindy - CCL is up big time today, nearly 5% or so. I bought some shares today in CCL. Will need to buy Zen as well, but perhaps next month, once I have researched more about the company and also when my fiscal situation permits.

[pgupta]

Originally Posted by VindyWheels

I had met the managements of CCL, Zen and Moldtek last week and have invested in all the three with considerable allocations to CCL and Zen.

Cheers

Vindy

Thanks for all the very informative posts, the discussions and information shared is hugely useful for a person like me who is a novice when it comes to stocks.

Just a observation based on the charts. When I look at some of the stocks which have been discussed in this thread recently (CCL, ZEN etc.) , there is this common pattern where the stocks have gone up in last 6 months, mostly driven by positive mood created by the election results. Hence do you think that the increase in the stock price can be contributed to strong company performance which, I assume, must not have changed drastically in last 6 months. And if this is true that it is due to the bull run then the moment we see a correction, the prices will also drop significantly. Is this right or there is something here which I am missing ?

Thanks for your comments.

[VindyWheels]

Hi, your concern is very much valid. These stocks have gone up very fast.

Zen is a clear case of a business waiting for conducive environment. After the new government took charge and made clear its policies on defense sector the stock price shot up. Imagine this company has been waiting for last 5 years with excellent products in the defense simulation-training space, but the previous government did little to implement the much needed budget for this. We have been told that files are moving fast, tenders are getting rolled out and there is clearly specified preference for Indian company with Indian technology. Zen stands tall in its space. Tenders pertaining to around 6000 Cr in simulation space is expected to be rolled out in coming 3-4 years and this com has little competition currently. The management expects to get atleast 4000 Cr of this. The AMC contracts itself is expected to reach 60 Cr in next 2 years. The current order book is 170 Cr. The company's annual sales was 48 Cr last year. Its a microcap currently with seemingly dominant position in its space. My personal take is that even if competition comes in, it will take some doing to match-up as defense trial process is stringent and time consuming. And once a company gets the orders, repeat orders and AMC comes to it unless they screw-up. Hence current price despite the 10 times appreciation in a year does not capture the future potential. I see a correction only if order book does not grow. Zen would have been a difficult call earlier without new gov and defense sector policy announcements. So I do not think I would have been able to buy last year. The past numbers do not say anything about what this com is capable of in an enabling environment.

CCL is a case of company coming to the limelight with capacity expansion in Vietnam and the bullish sentiments. Valuation wise I am comfortable, but it would have been good to spot this earlier, certainly a missed case unlike Zen.

Bull phase generally will punish bad results of small companies heavily. But just because a stock ran-up there is no need to fret if you are a long term investor and has conviction in the business. Each person has his own comfort range in valuations and each person's conviction in different businesses will differ. I believe there is adequate margin of safety. But remember I had bought Zen at 268 and CCL average price is 110.

Most stocks have ran up, if your view is that this is not a good time to invest then there is no need to look at individual stocks. If one does not learn to ride the good times it does not justify being a full-time investor. I reserve my right to be stupid

Originally Posted by pgupta

Thanks for all the very informative posts, the discussions and information shared is hugely useful for a person like me who is a novice when it comes to stocks.

Just a observation based on the charts. When I look at some of the stocks which have been discussed in this thread recently (CCL, ZEN etc.) , there is this common pattern where the stocks have gone up in last 6 months, mostly driven by positive mood created by the election results. Hence do you think that the increase in the stock price can be contributed to strong company performance which, I assume, must not have changed drastically in last 6 months. And if this is true that it is due to the bull run then the moment we see a correction, the prices will also drop significantly. Is this right or there is something here which I am missing ?

Thanks for your comments.

[pgupta]

Originally Posted by VindyWheels

Hi, your concern is very much valid. These stocks have gone up very fast.

Most stocks have ran up, if your view is that this is not a good time to invest then there is no need to look at individual stocks. If one does not learn to ride the good times it does not justify being a full-time investor. I reserve my right to be stupid

First of all thank you for the detailed answer. Appreciate you taking time to explain.

Riding the bull is not easy and unless you know how to. Novice riders like me will mostly get it wrong, unless they get the required guidance from the 'Matadors'. :-)

I was wondering if it's still worth to get into these stocks from a 2-3 years time frame.

[VindyWheels]

Hi, here is the latest interview of Basant aired by NDTV a few days back. Must watch for retail investors.

http://www.ndtv.com/video/player/new...vesting/345376

Guptaji,

CCL at 150 I am not too sure if you can make large allocations, but if retail foray clicks big time, then its still very attractive. So you can track the retail growth closely and invest later too with more surety. Zen still looks good, but not sure if you will get to buy as its in upper circuit daily. Shilpa Medicare is still attractive. Mold-tek packaging looks good for next 5 years. Shriram City Union Finance still looks good and so does Repco Home Finance. I like Adi Finechem and PI industries too. Ajanta Pharma has ran up to 2400 now, but still looks good to deliver 25% CAGR for next 5 years. Kaveri seeds should also do well if you have a 3-5 year horizon.

There are some in the radar, need to do more work - Tastybites, IPCA labs, Hawkins, GIC Housing. Anybody interested in these do pitch in.

Cheers

Vinod

[VindyWheels]

Zen crossed the psychological Rs 500 figure and is down 2%, the circuit limit! Buyers who bought at much lower levels could be selling. Expect high volatility. There is also a stock split next week, wonder what will happen after that

[sukhoi]

Hello all,

Discussing an old news but still. TCS and CMC merger is happening and as per terms of Scheme of Amalgamation, shareholders of CMC will receive 79 equity shares of TCS for 100 equity shares of CMC (http://www.moneycontrol.com/stocks/r...cs-873103.html).

Today's closing price is CMC @ 1925 per share and TCS @ 2605 per share. 100 shares of CMC need INR 192500 for which I get 79 shares of TCS bringing TCS price to INR 2436.7 odd.

TCS is a good long term story as has been discussed in this thread across posts. My question is, why would it not be better to buy CMC and get TCS in 2015 than buy TCS today? As a layman, I would expect the prices to be similar / in-line yet TCS is available at a premium (if I may say so), when purchased directly as against when purchased via CMC route. Obviously, I am missing something which Mr. Market is aware of and hence the price difference exists but am not able to figure out why. Any inputs.

Cheers

[alpha1]

What's up with Honeywell Automation?
I don't see any reason for its price to shoot up the way it has over past two weeks!

[BaCkSeAtDrIVeR]

TCS vs CMC merger - such difference are normal and you can use the arbitrage opportunity.

Have used similar opportunity in Sesa Goa - Sterlite deal. No huge profit in absolute terms though, coz I never put more than 10% of the portfolio in a single entry.


About Honeywell, well, honey, all auto ancillaries have run up well!

Am holding AL @ 17 and Suprajjit @ 60. I had sold the latter @ 55 where my average cost was 24. Earlier, AL was held at 13 and sold at 19.

[fordday]

Originally Posted by BaCkSeAtDrIVeR

About Honeywell, well, honey, all auto ancillaries have run up well!

I do not know why Honeywell has run up in the last few weeks, but classifying Honeywell as an auto ancillary is incorrect. Their auto business is miniscule compared to their foray into industrial automation, defence, Aviation etc.