Buy Merck

Buy Merck.
Report from outlook money

Two interesting articles

Reading thru various sites, I found these two interesting articles.
One of the full proof ways of making money is following the smart money.
First article tells why the smart money will come to India and the
second one talks about how much this money could be.

A trillion dollar tidal wave

Where is OPEC spending its wealth?

India's 40 Richest

Forbes latest list of 40 richest Indian.

Bulll market

Is it the last phase of bull market?
Emerging markets in last stage of equity boom

Unbelievable amount of money is flowing into emerging markets.
PetroChina's IPO attracts record $440 bn.
In Rupee terms it is 176000 crores.

NRN's Interview

One of the most candid interview by NRN.

NRN's interview.

I liked this statement very much.

"In Ramayana, Rama was accused of letting down the interest of Sita. But there is a lesson in that fable and that is for the sake of majority; leaders have to set an example."

I'm trying to be back

Almost six months since I did anything actively on stock market.
I'm trying to come back now.

I did invested in Power Grid IPO and results are beyond expectation.
Well, bull markets can do anything. No upper limits. I am still holding PowerGrid.

I am keeping all my money for IPOs. Looks like they are the safest bet right now. Don't think, just blindly invest in IPOs, you'll definitely make some money.

Some Inspirational Quotes

"An investment in knowledge pays the best interest!"

Benjamin Franklin (1706 - 1790)

The best way to forecast the future is to invent it

Alan Kay

“To buy when everyone is desperately selling and sell when everyone is buying requires the greatest fortitude but pays the highest rewards.”

Sir John Templeton

"Destiny is not a matter of Chance,
but a matter of choice.
It is not a thing to be waited for,
it is a thing to be achieved..."

William Jennings Bryant

“Purity, patience, and perseverance are the three essentials to success and, above all, love”

Swami Vivekananda, (1863-1902)

Some people Succeed because they are Destined to But, most people Succeed because they are Determined to!

Mutual Funds I have

As I mentioned last time, I have sold almost all my stocks.
I have mutual funds in my portfolio now.
Funds I have are
1. Fidelity Equity Fund
2. Fidelity Tax Saver
3. Fidelity India Special Situation Fund
4. Fidelity International Opportunities Fund
5. HDFC Top 200

As you can see my major investment is in fildelity funds, I am trying to diversify now.
I have a SIP in HDFC Top 200 and Fidelity Equity Fund, rest of them were lump sump
investment.

Everything sold

Last month I got a chance to off load all my stocks.
And first time in last 7 yrs I was able to overcome my emotions and stock mania.
There are multiple reason why I did this.
1. I got bored of stocks.
2. Stocks impacted my primary job too much.
3. For some time I want to concentrate on my IT career.

Now I have taken alternative approach of mutual funds. Have bought couple of SIPs in equity funds.

Australia Won

This world cup cricket was a flop show. No team was even close to giving a fight to Australia. I expected Australia to lose but they proved me wrong.

The way I was against Australia typically represents the mentality we have towards stocks. Let me explain this.
Let's say Australia cricket team is a A category stock and teams like India , Pakistan etc are C category stock.
Most of the time we know that a A category stock will outperform C category ones but still we keep on betting on Cs. Classic case in Infosys. Infosys is just like Asutralian cricket team, consistent performance even in adverse conditions. Yet instead of buying Infosys we keep buying other C category IT stocks.

So next time try to bet on Australian cricket team rather than India.

Relocated to USA

Last few months were very hectic for me as I got relocated to my company's headquarter in Minneapolis. Now that I'm in Minneapolis I will get time to update my blog.


This time no stocks but cricket. Million dollar question is will Australia win the world cup?
Let's take a clue from history , last year in Soccer world cup Brazil looked unstoppable.
But then just one below average performance in semifinal match knocked them out.

To me Australia looks a definite potential case like Brazil.

Let's see if my prediction will be correct.

Stocks I hold

These are the stocks I hold.

Amar Remedies
Apollo Tyre
Classic Diamond
Era Construction
Futura Poly
Gitanjali Gems
Nectar Life
Parsvnath
PBA Infra
Pratibha Industries
Reliance petro
RPG Transmission
Revathi Equipment
Rolta
SRF Poly
Sunil Hitech
TechnoCraft Industries
Valecha Engineering

Total is 18. Now you can understand in what mess I am ? Tracking all of them is pain.
But at the same time it is some fun also.
Moving forward I want to bring this list down to max 10. May be in next few months.

Freakonomics

Few days back I got a chance to read this book. And this book is really written by a kind of freak. Through out the book author(Steven D. Levitt) has challenged conventional wisdom. Author's site is www.freakonomics.com

For example in US presendential elections the candidate who recieves maximum donation is winner. So according to conventinal wisdom to win elections you should get more donation than your opponents.
Steve has given counter of this wisdom. Lets say you are giving a donation to a candidate during election. Whom would you prefer?, some one who has no chance of winning at all or someone with strong chances. Answer is obvious. So the truth is winning a election is not a result of getting more donation but a mere confirmation that candidate had good chances of winning election.

Book is full of these kind of examples. But my favorite is section where School Teachers of US are compared with Sumo Wrestlers of Japan.


Back to stock market. Week of 16th Feb was full of excitement , with market crashing like anything and then recovering some what. One stock which is having really bad times is Parsvnath Developers. From the listing price of 550 (IPO price 300) on 30-Nov-2006, it has continuously slided. CMP is 321. Stock deserves better price than this. I picked some in this crash @ 300. Lets see where it goes.

TechnoCraft Industries

TechnoCraft listed on 12-Feb-2007. IPO was at 105 and CMP is 118.
Stocks looks like a decent pick. Company is talking of an eps of 20-21 in FY08 and in 14 in FY07.
More details are at
http://www.moneycontrol.com/india/news/iponewlistings/sharadksaraftechnocraftindustries/seers500crtopli/market/stocks/article/266673

http://content.icicidirect.com/ULFiles/UploadFile_2007118171334.asp

I got some allotment in IPO and I have picked some more.

Stocks was quite stable during the crash of Monday. I am hoping it will give good returns in comming days.

More Stocks

Here is the link on Valecha.
http://www.indiainfoline.com/company/showleader.asp?storyId=382&lmn=4&cat=1
Mangement is quite bullish on business.

Pratibha Industry. It has quite a good order book and I am looking at target of 400 plus in future. CMP 245.

Rolta. This stock has been performing well as per my expectations. CMP 310. It is in FIIs buy list now so will not fall much. But if there is any correction buy it for good returns.

Stocks for year 2007

One of the ways I pick stocks is choose companies which have given results more than expectations. Obviously the results should not be a case of one time earnings become of some asset sale.
Some of the stocks on above criteria is

1. Nectar Life Science CMP 215. 9 months eps is around 23. I am quite bullish on this stock. Target are quite high. Not sure but could be 400 plus in next 1 year.

2. RPG Tranmission, this power hungry country needs lot of transmission line. CMP 215. Target may be 300.

3. Valecha Engineering. CMP 240 . This stock is back in my list. Management is talking about 50% growth in next two years. FY07 expected eps is 18. FY08 expected eps is 27.
Stock should cross 350 in next one year.


More stocks next time.

Themes for 2007

Happy New Year to all readers.
New year has started and here is my point of view for this year.

I have not researched into specfic stocks but these are broad sectors to look out for in 2007.

1. Infrastructure includes roads, ports, air ports, apartments, malls.

2. Power : Transmission and Distribution and power generation

3. Entertainment : Multiplexes

4. IT: Growing outsourcing

5. Pharma: Growing outsourcing.

Some of picks are
Rolta, 3i, Revathi Equipment, Era Constuction, Sunil Hi Tech, PBA, RPG Transmission, Nectar LifeScience, Amar Remedies, Adlabs, PVR, Reliance Energy and IPOs.

I need people who can help in doing stock research. Let me know at bads.stockmarketblog@gmail.com if you are willing to.

PennyWise Pound Foolish

Lot of us have tendency to put buy or sell limit orders at a price which is very close to current market price(CMP) but not at CMP. For example if a stock is trading at 92.50, we are more inclined to buy at 90 (few paisa lesser) and vice versa while selling. Some how it gives us a feeling that we have saved some money by buying at lower rate. By following this we may save some money but ultimately chances are that one bad decision will give much more negative affect than all small transactions put together.

This happened to me this June 06.
Rolta was selling at 203 and I put an order for selling 75 shares at 203.50.
Next day I realized that it did not sell and Rolta closed at 185. And after that slide continued and after few days Rolta settled at 135. Imagine just to get extra 75 paisa I lost approx. 5K. So moral of the story is when you want to buy or sell just do it. Do not fret over few pennies here and there.

Passing Thought.

Height of Optimism:
Metro will be operational in Bangalore in next few years