Friends – I am back after my son’s wedding that kept me busy for the past four months.
With the markets going up post Pulwama attack –there is a renewed urgency to look at stocks where there is still some upside left.
Here are my recent picks along with prices below which I have invested in the past few months:
- 3M India – This is a new addition to my portfolio, and I am slowly accumulating this stock. I am open to buying this below 20100 and the last time this stock was at this level was in Jan 2019 – this stock is likely to give a 20% per annum capital appreciation if bought at these levels.
- Godrej consumer products – my buy price for GCPL is below 710 and currently the price of this stock is 708 – this company grew few years back due to lots of acquisitions abroad – now they are focussing on growing organically and I think it will grow at 15% plus in the coming years.
- Gruh Finance – this was sold by HDFC to Bandhan Bank few months back. HDFC demands a premium and the stock went down post this sale by about 30% – the stock is on the way up now – Bandhan bank also commands a premium in the market (as seen by it’s PE). Even though Bandhan paid a high price for this acquisition, I am hopeful that this merger would be good for the combined entity. My Buy price for Gruh finance is 310 and the current price is below my buy price.
- Maruti Suzuki- There is a bit of slowdown in the car sales recently and that is impacting Maruti – I am open to buying this below 8150 and currently it is 15% below this price – this stock is likely to give a 20% per annum capital appreciation if bought at these levels.
- MRF – this is a stock that is below my buying price right now – my buy price is 64500 and it is currently quoting at 57500. I think this is a 20% ROI kind of stock.
- Pidilite – this company is also my favourite and I am happy to buy it at prices below 1300 -currently it is at 1165.
- Tata Elxsi – this is a compamy that I have started adding last year – the company is growing bottom line at around 30% and the stock is expected to give similar returns if bought at a right price. I believe that the right price for this stock is 1175 or below – currently it is quoting appx 20% below these levels and hence I am buying.
Please note that these are not stock recommendations – I am sharing my recent stock buys and I recommend that you do your own analysis before investing.
In Mutual funds – most funds are under performing the markets in the past one year. Even though I do not invest through MF’s, I would be happy to invest in the following funds:
- Multicap fund – Kotak Standard Multicap fund – this fund is the largest fund by AUM in this category and has a reasonably good performance in 3 and 5 year time frame.
- Large cap fund –I believe that in future, this category would find it difficult to beat sensex as 80% of the fund AUM has to be invested in large caps ( the top100 companies) – add to that appx 2% expense ratio – and so outperforming Sensex post the expense ratio is difficult. It may make sense to buy an ETF that tracks Nifty or Sensex. SBI Sensex ETF is the largest ETF tracking Sensex and that would be my choice.
- Large and Mid cap funds – this category is good for someone who is ready to take reasonable risks – someone in his/her 30’s or 40’s – this category represents the top 250 companies in Indian markets and so it offers a good breadth of companies to chose from. The fund that I would go here is Mirae emerging blue chip fund.
- Mid cap fund – this is a category that I believe in – stars of tomorrow – of the 150 companies in this category – some will surely grow into large caps – the fund that I would go with is HDFC Mid cap opportunities fund.
- Small cap – I do not believe in this category – there will be a few who are tomorrows stars hidden here – but most companies would not grow into mid caps and will stay small.
- ELSS Funds – As there is a three year lock in in ELSS funds, looking at the three and five year rolling returns for the past few years – I would go for Axis long term equity fund.
- Sectoral fund – my preference is for the consumption theme in India – ICICI FMCG Fund and Sundaram Rural and consumption fund – both should give 15% annualised. There are other themes too, like theDigital theme (read IT companies) or the Banking and Financial services theme ( this is doing well right now) – but I guess I am biased.
- Debt funds – with the interest rates expected to go down in the coming months, it would be best to stay invested in money market funds that would give appx 8% annualised – the fund that I would go for is ABSL Money manager fund.
So if you still have liquidity and are waiting for investing opportunity – I would recommend that you invest now. Do your own research and invest for long term.