[Ferrari1976]

Originally Posted by Dieselritzer

HI friends, I currently do invest in stocks but its mostly based on tips and suggestions of broker and friends. I would like to learn how to study stocks, etc. Does anyone know of any such classes or anything like that in Mumbai where i can learn it? Aim is not to do intraday trading, but to ensure I earn good returns in medium to long term on idle cash.

Fundamental Analysis is defining earnings (trust me, there are 100s of ways of defining these terms) and invested capital, determining the rate of return and projecting reinvestments (capex) and growth. Together with an appropriate discount rate (rate of expected return) gives you a net present value of the returns (Free cash flow). This is then equated to the market value and margin of safety then determines the buy or sell decision.

The best way to start is understanding the terms above, step by step. I have learnt a lot thru Prof. Damodaran's youtube classes. I would recommend you take those. https://www.youtube.com/channel/UCLv...RR1T9cbSccaoVw

[shetty_rohan]

Originally Posted by Ferrari1976

The best way to start is understanding the terms above, step by step. I have learnt a lot thru Prof. Damodaran's Youtube classes. I would recommend you take those. https://www.Youtube.com/channel/UCLv...RR1T9cbSccaoVw

Thank you. Just watched the first video

https://www.youtube.com/watch?v=znmQ7oMiQrM

Planning to watch each of his video in coming days.

[Ferrari1976]

Originally Posted by shetty_rohan

Thank you. Just watched the first video
=======
Planning to watch each of his video in coming days.

He has changed his forecasting method to a more revenue assumption basis from a resinvetment*roic calculation. I suggest you follow his latest Valuation Undergraduate (Spring 2017) playlist.

[fordday]

Originally Posted by J.Ravi

Today, I booked partial profit in SKFINDIA by selling 10 @ ₹ 1,550, 10 @ ₹ 1,570 and 10 more @ ₹ 1,579.20. I bought these shares in 2006 at an average price of ₹ 305.25. I still have 70 more shares, which I would sell in the coming days.

Sir,
Your investments seems to multibagger. Really appreciate you for sharing your buy sell actions.

Would you care to share some of your ideas for us novices? Not looking for buy recommendations, but ideas like -

- Do you look into a sector specifically?

- What do you look for in a company?

- How do you identify what is the right price to pay for a share?

- Do you have a timeline to hold when you buy?

- How do you know when to sell?

- What is your strategy like? Buy and sit tight?

That's too much for now :-)

Originally Posted by fordday

Really appreciate you for sharing your buy sell actions.

Thanks, fordday. I write this specifically as there is no 'thanks' button to press for this thread.

- Do you look into a sector specifically?

Private/psu banks, auto, oil & gas, power, hotels [now totally disinvested], pharma [totally disinvested], media, etc.

- What do you look for in a company?

Long term prospects, future growth, management and dividend yield. After my MS Omni/Versa ownership, I invested in Maruti. When I bought Linea, I invested in Tata Motors. Ditto in case of M&M, when I bought XUV 500. I have accounts in Axis Bank and SBI. So, I have invested in them. Bought PVR, Inox [disinvested now] and Sun TV [disinvested] too. In nutshell, when I like a product, I invest in that company.

- How do you identify what is the right price to pay for a share?

I buy in phases, whenever the market crashes. I buy, whenever the share price reaches its 52-week low and sell after a few years, when its price hovers around 52-week high.

- Do you have a timeline to hold when you buy?

Minimum one year so that I need not pay capital gains tax.

- How do you know when to sell?

Maybe after 10 years or so. Or whenever I need money for some capital expenditure like house-construction, buying a new car/motorcycle, etc. My wife was allotted with 50 Hero Honda shares at par [₹ 500] in IPO in 1985 against heavy over-subscription at the time of formation of that company. Then, 10% of the production of Hero Honda CD 100 was reserved for allotment to the shareholders. We bought our first motorcycle, Hero Honda CD 100 in 1985 under that quota, when it commanded premium in the open market, enjoyed riding it for the next 15 years, sold it for almost the same price we paid and sold the shares years later - with the rights and bonus - and got back the full cost of the bike! So, keeping invested in some bluechip companies for decades will definitely bring in huge profits by way of capital gains and regular dividends apart from total peace of mind and mental fulfillment.

- What is your strategy like? Buy and sit tight?

I am not a day-trader. I am not a short-term investor. I don't bet on future & options. I don't short-sell. I am a long-term investor, holding for minimum one year . Sometimes, I book losses too. Now, I am under loss in MOIL. I will disinvest in MOIL soon.

[fordday]

Originally Posted by J.Ravi

hotels [now totally disinvested], pharma [totally disinvested].

Why did you disinvest in these sectors? Are these cyclic in nature? Hotels sector may be down but they always seem to bounce back and tourism industry is always growing.

Pharma seems to be always in the news though not always for the right reasons.

Originally Posted by J.Ravi

Long term prospects, future growth, management and dividend yield. After my MS Omni/Versa ownership, I invested in Maruti. When I bought Linea, I invested in Tata Motors. Ditto in case of M&M, when I bought XUV 500. I have accounts in Axis Bank and SBI. So, I have invested in them. Bought PVR, Inox [disinvested now] and Sun TV [disinvested] too. In nutshell, when I like a product, I invest in that company.

How do you analyse the factors in highlighted bold part? As these are not hard facts or numbers, what rules do you have? Moreover how do you collect these info?

Originally Posted by J.Ravi

keeping invested in some bluechip companies for decades will definitely bring in huge profits by way of capital gains and regular dividends apart from total peace of mind and mental fulfillment.

Agree a blue chip companies have less than little risk. Do you also tend to dig into smaller companies which can sometimes provide enormous returns?

The intention here is to identify your thought process and if possible to think like you.

[audioholic]

Originally Posted by J.Ravi

Thanks, fordday. I write this specifically as there is no 'thanks' button to press for this thread.

Thanks a lot for sharing those tips sir. Helps newbies like me who have started investing in stocks recently. I started my stint a little more than a year ago and it has fairly been a good run for me. Like you said, I dont do the things you dont do and that has proved to be quite reliable, since for the last financial year I had made good profit and ended up paying capital gains tax.

However, from now I want to invest for more than a year, since I dont feel the need to book profits unless I am really in need of money.

Originally Posted by fordday

Why did you disinvest in these sectors?

Many years ago, I needed money for my house-construction. So, I booked profit in Oriental Hotels. Afterwards, I have not reinvested in that sector as I don't want to have too many sectors and too many stocks in my portfolio.

Moreover how do you collect these info?

The detailed analysis from my broker, Kotak Securities and daily updates help in converting numbers into decisions! I also refer to Money Control and Value Research to cross check these facts.

Do you also tend to dig into smaller companies which can sometimes provide enormous returns?

For smaller companies, I resort to the mutual fund route. I have investments in Franklin India Smaller Companies Fund, Prima Fund and DSP BR Micro Cap Fund [all direct - growth]. All are doing nicely.

Originally Posted by audioholic

However, from now I want to invest for more than a year, since I dont feel the need to book profits unless I am really in need of money.

Thanks, audioholic. I wish you all the best.

[fordday]

Originally Posted by J.Ravi

The detailed analysis from my broker, Kotak Securities and daily updates help in converting numbers into decisions! I also refer to Money Control and Value Research to cross check these facts.

Thanks for your reply.

Do you think these days the market is running at irrational valuations?

With NSE PE at around 24, are we at the edge of the cliff?

With some of decent companies at stratospheric levels of 50-60 PE, what is your strategy now?

To be frank I am scared to look at market now. No Buy, only sell if needed is my thinking, in present state.

Originally Posted by fordday

what is your strategy now?

Make hay while the sun shines. It's time to book profit. Today too, I have given some 'sell' orders, which are waiting to be executed. In my case, for every successful 'sell' order, there are four or more unsuccessful orders behind it!

[avingodb]

any calls on the aviation sector?
I am holding Spicejet since 64 and now at about 103. While the temptation to book profit is high, I am also reading conflicting reports on the web on whether to hold or sell.

[audioholic]

Can anyone explain how dividends work? I have had some shares of Vedanta for which a dividend has been announced. I brought these shares on 1/03/2017 and added some more today. Will I get dividend for only the ones brought earlier or include the shares brought today? I could not understand the meaning of the various dates.

Also, since the dividend is announced, will the prices drop soon? Any clarifications will be appreciated.
Thanks in advance

[SmartCat]

Originally Posted by audioholic

Can anyone explain how dividends work? I have had some shares of Vedanta for which a dividend has been announced. I brought these shares on 1/03/2017 and added some more today. Will I get dividend for only the ones brought earlier or include the shares brought today? I could not understand the meaning of the various dates. Also, since the dividend is announced, will the prices drop soon? Any clarifications will be appreciated.

The company makes the dividend announcement on a particular day, and also mentions the "record date" (or effective date). In Vedanta's case, as long as you buy before 11th April 2017, you will get the dividend -

http://www.moneycontrol.com/company-...a/dividends/SG

When its a large dividend payout like the above, yes, the stock will fall. Because there are many investors who pick up this stock only for the dividend. Once that is credited, they will sell the shares. Many don't mind booking losses in sale of shares either - especially if they want to reduce their tax liability (adjusting previous profits against this loss).

This is called 'dividend stripping'.

[vinit.merchant]

Dmart and Shankara. Both these have totally beaten the fundamental basics of valuation.
I have lost count of the multiple earnings at which Dmart now trades.

If you think about Shankara, it had only 45 crore worth of new equity in the IPO. Rest was its promoters offloading their shares. Now, why should the company, just for 45 crore additional capital, raise an IPO and then be bound by the SEBI regulations (which is a lot of work)?

Amazing how the market defies logic time and again.

[fordday]

Originally Posted by vinit.merchant

Dmart and Shankara. Both these have totally beaten the fundamental basics of valuation.
I have lost count of the multiple earnings at which Dmart now trades.

Amazing how the market defies logic time and again.

To me this looks like euphoria. These are 'interesting times'. Everyone's jumping into the game. They will find out when the music stops.