[vinit.merchant]

Originally Posted by JMaruru

Any here applying for SBI Insurance IPO? Would it be worthwhile?

Please advise!!

Current say on the street is that the issue is fairly priced and hence there is nothing in it for those looking for listing gains. The grey market premium for a Rs. 700 issue is a meagre Rs. 20-25.
But the business has a lot of potential and it will grow slowly. If you wish to keep the shares for very long term, go ahead and apply. I feel one will easily get the opportunity to buy it from the market at issue price or maybe a little lower if one is patient.

I am giving this issue a pass. I would rather apply in Pratap Snacks IPO coming up later this week.

[SmartCat]

Originally Posted by vishal9999

Hi Smartcat,
Can you explain us in brief how do EPS and PE ratio work for layman and how to analyse a company based on above two parameters.
Thanks.

Price to Earning Ratio (PE Ratio) = price of stock divided by EPS (earnings per share). So EPS & PE are inter-connected. But this can be a bit confusing for a layman. So let's take a different route:

PE ratio of a stock will also be roughly equal to market capitalization divided by net profit for the previous 4 quarters (1 year).

So in layman terms -

A stock trading at PE of 20 means - you are willing to pay Rs. 20 now to receive just Rs. 1 back at the end of one year. That means, if the net profit of the company remains constant, it will take 20 years to get back your money.

Now that sounds like a terrible deal. But then when we invest in a stock, we expect the company to grow its profits every year and not remain constant. That's why PE ratio should be looked at in conjunction with its estimated future profit growth.

1) If a stock is trading at PE of 20 and is expected to grow its profits at 20% per annum, then you have got yourself a great deal. Eg: YES BANK

2) If a stock is trading at PE of 10 and is expected to grow its profits at 5% per annum, then it is not as great deal as the first one. Eg: NTPC

You can get an idea about future growth prospects by reading analyst reports. Go to www.trendlyne.com and type in the company name. Click on REPORTS link to read analyst estimates.

Add a dash of salt though.

Sometimes, these analyst estimates turn out to be wrong. That's why you should look at past track record in profit growth too. MOTHERSON SUMI has grown its profits at a rate of 30% per year in the past 10 years. Now if an analyst report says Motherson is likely to grow at 25% for the next 2 years, it is much more believable. Now, SUZLON has a terrible past track record. But if you read an analyst report that says it will double its profits over the next 2 years, you need to be cautious and not take the analyst report at face value.

[daretodream]

Folks

What is your opinion on BOSCH?
I'm holding shares at average 23k cost price and now it's holding at 21-22k range.

Should I buy more or just hold and invest the amount in some other stock? What are possible stock recommendations instead of BOSCH?

[Ithaca]

Wanted to share an excellent video I saw recently.
Nilesh Shah of Kotak Mutuals gives his take on our economy and where he hopes the markets are headed.

Worth a view.

https://www.youtube.com/watch?v=5TwqSoShVCg

[VKumar]

Okay guys, anyone here who has invested a huge volume in HEG Ltd.?

This stock all alone has made me eligible to buy a BMW from a Honda City

In 4 months!!

[fordday]

Originally Posted by VKumar

Okay guys, anyone here who has invested a huge volume in HEG Ltd.?

This stock all alone has made me eligible to buy a BMW from a Honda City

In 4 months!!

This seems to have climbed up four times in four months.

Enjoy your profits.

How did you get into HEG? I haven't even heard about them till today.

[VKumar]

Originally Posted by fordday

This seems to have climbed up four times in four months.

Enjoy your profits.

How did you get into HEG? I haven't even heard about them till today.

A random friend just recommended me this stock in June.

I bought a decent quantity at 278, then it flew and I again bought some at 370, and once it was at 480, I took high risk of putting every egg I had in this one basket. Now the 10% growth of today has made it immensely profitable for me(that's around 35% of first time purchase value) and probably for the first time in my life I am happy to have not put my entire cash in a car. 4 segment upgrade possible in 4 months, this market can do anything

[fordday]

Originally Posted by VKumar

I took high risk of putting every egg I had in this one basket.

Assuming you had done due diligence and analysis of the stock and convinced yourself, then this is the major takeaway and should be an eye opener.

As Vishal of Safal Niveshak said something like "My biggest regret is having small positions in stocks where I had large convictions."

[VKumar]

Originally Posted by fordday

Assuming you had done due diligence and analysis of the stock and convinced yourself, then this is the major takeaway and should be an eye opener.

Indeed I did my complete research, and if I am not wrong then I made a mention of HEG somewhere else on the forum when I was a new investor. Probably in June itself, when I was feeling expert opinion. Probably @smartcat's thread was that.

Now I am expecting a few stocks to do well and the target prices I am expecting are:
HEG 1600+ (I am willing to hold till first 3 dips)
Graphite 800
Asiantiles 650
V2retail and IBventures I am studying.

[deepv]

Originally Posted by VKumar

..
I bought a decent quantity at 278, then it flew and I again bought some at 370, and once it was at 480, I took high risk of putting every egg I had in this one basket. ...

Originally Posted by VKumar

Indeed I did my complete research,
...

Now I am expecting a few stocks to do well and the target prices I am expecting are:
HEG 1600+ (I am willing to hold till first 3 dips)
Graphite 800
...

VKumar, this was a very good catch and by the looks of the chart, very appropriately timed.
Would like to get some insight into how you go about researching for such catches - zeroing in and putting the targets as you mentioned?

[inder]

Guys any views on Indian Energy Exchange IPO . Apply or not ?

[VKumar]

Originally Posted by deepv

VKumar, this was a very good catch and by the looks of the chart, very appropriately timed.
Would like to get some insight into how you go about researching for such catches - zeroing in and putting the targets as you mentioned?

Actually i am a new investor with hardly 5 months of total investing experience, hence I tread very carefully. It takes me at least 10-15 days just to zero down on the shares I am going to put my money on. Graphite India was a recommendation by a friend and HEG was discovered by me while simply exploring. Instead of some particular companies, I zero down on the industry, pick 10 companies and start doing my analytics. At times it goes wrong (I lost sometimes and once I lost in 6 figures too) and at the same time it helps gain too.

What I do?

1) Zero down on an industry.
2) Zero down on 10 companies to research on, mainly midcaps (they are most profitable IMO)
3) Start with financial ratios (I am a PGDM student and this has helped me a lot with my curriculum too)
4) Check market sentiments and what can be the future prospects
5) Do competitor analysis and government policies

Once done, I pick the stock which I find has potential.

Similarly I have done many single day or two day purchases like TCI Logistics on the day of GST rollout (Flat 12% return in one day and I spent in six figures, again high risk), Tata motors after Nexon launch. Today also, i sold a major part of my HEG investment at 1321 bucks at 11:07 am and boom, HEG started felling the next moment and it was a fall of around 80 bucks from that level (I wish I sold at 10:45 though), it was just an intuition that dip is coming. I have no reason for that and I am again purchasing tomorrow if I see a spike coming. Additionally I am planning to bet big on Adanitrans and Graphite once.

Why I don't recommend? Because I am still not very sure of my research and have around 1/4 failure rate. Most of my purchases are based on minor research and intuition, that's where the experienced players like Smartcat do come into play, more experience and hence better research outcomes. Following are a couple of gems of recommendations, quoted from a post above:

Originally Posted by smartcat

Price to Earning Ratio (PE Ratio) = price of stock divided by EPS (earnings per share). So EPS & PE are inter-connected. But this can be a bit confusing for a layman. So let's take a different route:

PE ratio of a stock will also be roughly equal to market capitalization divided by net profit for the previous 4 quarters (1 year).

So in layman terms -

A stock trading at PE of 20 means - you are willing to pay Rs. 20 now to receive just Rs. 1 back at the end of one year. That means, if the net profit of the company remains constant, it will take 20 years to get back your money.

Now that sounds like a terrible deal. But then when we invest in a stock, we expect the company to grow its profits every year and not remain constant. That's why PE ratio should be looked at in conjunction with its estimated future profit growth.

You can get an idea about future growth prospects by reading analyst reports. Go to www.trendlyne.com and type in the company name. Click on REPORTS link to read analyst estimates.

Add a dash of salt though.

Sometimes, these analyst estimates turn out to be wrong.

That's where stocks like HEG etc are.

[skumare]

Anybody following Amara Raja batteries? It has fallen nearly 1/3rd from its peak in the last 12 months. Any thoughts?

[rama75]

Now that the Bharat mala road project has been announced, any suggestions on the companies that will benefit from this over the next few years?

[VKumar]

Originally Posted by VKumar

HEG 1600+ (I am willing to hold till first 3 dips)
Graphite 800
Asiantiles 650

So the desi boy HEG just soared past 1650 and this is when I am in a situation of keep or sell, will probably sell today, as advised by a senior investor once:
"Better regret after you sell than regret for keeping on hold"

Similarly Graphite is also showing quite a bull run.