Capital View & Review

26/03/2017 14:52:35
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Markets will be active only after the Shri Rama Navami. We may not see brisk trading before that, due to the Thursday F&O settlement, Friday fiscal year ending, Monday (April 3) and the following Shri Rama Navami holiday.
 
Still, there is scope for value investment in the market in various sectors. Stocks like SAIL, Prakash Industries in steel sector, Balasore Alloys in ferrochrome industry, Kalyani Forge in forgings, Simbhaoli, Bajaj Hindusthan in sugars, Max Ventures in packaging, Max India in healthcare, India Glycols, Kiri Industries in speciality chemicals, Pincon Spirits in liquors, Gravita, Grauer and Weil (India) in chemical processing, Prabhat Dairy in dairy, Mahindra Life Space Developers, Marathon Nextgen  Realty in housing sector, Palred Technologies in e-commerce, Aditya Birla Fashion Retailing in fashion retailing, Future Consumer Ltd in food processing, Atlanta Ltd  and Indian Hume Pipe Ltd  in infrastructure are trading at lower ‘prices’ than their real ‘values’. All these shares are providing excellent opportunities for long-term investment and are expected to give good returns on investment without any fear of loss in 2017-18. 
 
Many disruptive technologies are in the offing due to which most heavyweights will lose the places they occupied in the Nifty and Sensex indices. The brick and mortar companies will be quoting at ordinary Price to Earnings (PE) ratios and be losing their Market Capitalisation. Futuristic technologies are going to rule the roost. They get fancy PE ratios as investors chase them. Even these companies cannot retain the high PEs. One reason for this, the further shortening of economic cycles thus quickening the rise and fall of shares and lead to the declining the market cycle of 7-8 years that consists bull and bear phases of four years. Because of the sudden arrival of disruptive technologies, no company how big it is can claim a permanent leadership position. The existing behemoths cannot keep up their crowns.
 
The giant businesses and investment trusts of the developed countries mobilise funds at dead cheap interest rates from their countries and simply dump that capital on to the start-up companies of the developing countries. These start-ups lavishly spend the easy funds in the name of expansion. As they spend the capital and fail to generate real money from the business, the start-ups collapse under their own weight. Those which have technological exclusivity can survive the onslaught of cheap capital and increase their market capitalisation or valuation. The other companies that do not have any economic moats may at the most achieve a namesake growth rates. Their market capitalisation, too, reflects their fate.
 
if one is consciously aware of the thumb rule that one has to wait for at least One-Year, surely, every company that Share Guru introduces in its cover page story is a gem like one.  stock will bless them with 100% or more than returns. Some companies may take some more time and disappoint the investors. However, they never cause losses to those who hold them. In the risk and reward based capital markets, enabling the readers to get good returns without any fear of loss is the only principle that Share Guru has been practising. When in the worst situation, the loss should be the lowest. With these parameters, Share Guru selects the cover page company. Speculation and trading may give pleasure sometimes but that is a momentary thing only, whereas in investing we get long lasting blissfulness.  When we invest in a Fixed Deposit account, we simply keep it there and forget about it till maturity, say up to 3-5 years. If we come to stock market we the moment we buy a share we start to think about the returns and go on discussing the matter. One more thing is that we tend to accept the “free tips and advises” from those who do not even know what are the dynamics that drive the markets. We not even bother to question ourselves why these people are giving free tips and advises through sending tens of thousands of SMSs daily by spending huge money. We never doubt the sincerity of the person giving advises and ultimately lose hard earned money. The real culprit in this whole episode is our greed. The greed is our weakness. Our weakness is the market operator’s strength.
 Hevilambi Naama Samvatsara Ugadi Subhakankshalu. 

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