Share price of Cairn India has been relentlessly falling since past 10 months and made fresh 52 week low on 12th May 2015. The stock is down more than 48% from it's 52 week high and is trading at very attractive valuation (The stock trading at roughly 37000 crores mkt cap and the company as 17000 crores of cash as on 31st March 2015). Clearly irrational exuberance is playing here on downside and investors are dumping shares on fear and panic. But a closer look at the overall health of the company and it's valuation standing vis-a-vis global peers presents a compelling opportunity for medium to long term investors. Before comparing it's valuation against a large U.S based shale oil producer, some of the key points that go in favor for investing in the company at current price of Rs.198.
2. If you believe in the growth prospects of a company, invest in the stock and give it sufficient time.
3. Be an optimist. Pessimistic investors always lose money in stock markets.
4. Greedy investors will never make money in stock markets. Book profits after reaching your target price.
5. Never put your hard earned money without proper research. Never invest according to “Stock tips”.
A brief comparison of India's 2nd tier public sector banks (Bank of India, Bank of Baroda, Punjab National Bank) on parameters of total business, NPAs, restructured loans, profitability, return on equity and valuation reveals that Bank of India is trading at cheapest valuation among the lot in-spite of being largest in terms of global credit and holds promising upside potential in 2 years time-frame.
Having started "Amit Agarwal Model Equity Portfolio" on 21st March 2013, primarily to educate investors on stock selection, diversification (risk management) & portfolio management, the practice completes it's 2nd year of existence and has come a long way in terms of popularity and acceptance among small investors/ traders/ students.
The detailed performance review of the portfolio at market value as on 21st March 2015 is given below:
Booked profits in couple of names and allocated the released capital to average some of the existing one and also bought couple of new scrips. The net portfolio at cost stands increased to little over Rs. 2.02 lakhs.
The model portfolio will complete it's 2nd year on 21st March and we will gauge the performance of the portfolio at market value on that date.
In case you are on the blog for the first time, we started the model portfolio exercise (the first of its kind in India) on 21st March 2013 with a sum of Rs.1 lakh in order to help small investors in understanding the stock selection and portfolio diversification. Also many investors follow this model portfolio closely and buy and sell stocks based on the portfolio action.