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Today in a significant departure from our usual style where we largely focus on technical side of story, we will be more focused towards fundamental side of the story. This post is about a small cap pharma company with market cap of around 500 Cr. The product portfolio is impressive. A Debt free, Consistently Dividend…
When big money starts moving in, there is not much left other than stock making some crazy moves and since most individual investors are still in disbelief so they are not positioned yet and soon they will rush in. Sector doing this for few weeks is Information Technology. When you see most of the stocks…
By now the BNP members know that getting a salary or anything where you put your time in return of money is not going to make you wealthy. Nobody has ever got wealthy by selling his time. Then obvious next question is what one can do beyond earning money by selling his time. Answer is…
The mortality rate of small caps and micro caps is way too high for most of the individual investors to make consistent wealth from the space. They, if managing things alone, are better off focusing on more liquid, bigger and proven names. That of course will result in subdued returns. The stories often told to…
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Pharma, Chemicals, Technology, IT, Platform & Agri businesses have been doing great right after the bottom was made in last week of March, 2020. This small cap pharma after doubling in last 8 months has become mid cap and in next reclassification of Jan 2021, it will be classified as such. The company has been…
Claiming that regulatory changes do not affect the stocks is either out of naivety or plain lying. Under that backdrop, new circular by SEBI for multi cap funds to invest minimum 25% of funds in mid caps and 25% in small caps bodes well for market participants. We will talk about a stock which has…
SEBI has come out with circular(SEBI/HO/IMD/DF3/CIR/P/2020/172) which mandates Multi Cap funds to put minimum of 25% funds in each Large, Mid & Small Cap. With size of ~1.5 Lakh Cr, that will result in 37K Cr of inflow to small and mid caps by January 2021. Small caps and Mid caps are ready to run crazy.
How does SEBI defines Large Cap, Mid Cap & Small Cap you may wonder.
List the all companies by Market Cap in descending order and take Top 100 companies they are large cap and next 150 (from 101-250) are mid caps and rest are small cap.
As per the June 30, 2020 AMFI Classification based on SEBI circular market cap of all Mid cap listed in India is 21.07 Lakh Cr and of Small cap is 14.09 Lakh Cr.
Remember funds won’t be interested in most of the small and mid caps. Select mid and small cap they will buy.
A massive buying spree is coming in next 5 months. If you are holding some good quality small cap and mid caps hold onto it much better days are coming your way. Please avoid buying into any and all kinds of small caps and mid caps because of such legal mandates.
This move by securities market regulator SEBI will also result in much wider buoyancy in stock market and that will result into high animal spirits. This will also result in easy and cheap funding for smaller companies which for last 3 years have been beaten down and are trading at ultra cheap valuations. This is win – win for all. Regulator having right mindset, focusing on growth of wider markets augurs well for all.
Disclaimer: Posts on the platforms of BN are our perspective on the market. These are purely meant for learning purposes. The perspective provided should not be construed as investment advice or solicitation to trade. We may have positions in the stock mentioned. You agree to make no trade relying on the above contained information fully or partly. By using the content, you agree to these T&Cs.
Just like any other day, we were scanning through some charts amid the gloom and doom of the market, we spotted a stock making a stupendous move from entertainment industry mostly into owning IP of vast music library and film production. Stock was at its ATH. The name of the stock may sound like it is some tip, Tips Industries. On closer look at chart it looked like 19 years old level of 183 was broken yesterday(01 Sep, 2020) and it came to our radar on 02 Sep, 2020. The price was 215.
Have a look at this chart –
The stock was a buy on 22 June when it crossed its pre covid level at 134. Of course, we did not know back then if Tips was even listed. Again on 01 Sep when it broke out of 185 levels after the retest. 02 Sep was the perfect entry point as per our set up of ATH theme having strong fundamental stock story. That is when we put a broadcast message on this –
Now let’s see basics of the stock –
Investors who are obsessively focused on value which often tends to relate with buying more and more at the bottom will frown over such opportunity because stock has just become 4-5x in 1 year. Since we do not follow the dogma of value investing it does not trouble us.
Some data points –
1. 51 employees, founded in 1975 and run by Taurani family.
2. 25000+ songs in genre of bhajans to remix, 6M followers on Facebook, 1M followers on Twitter and 30M subscribers on YouTube.
3. Falling data rates, cheaper smartphones and wide gamut of streaming platforms and entertainment going digital augurs well for the company.
4. Company is planning to produce 2-3 films a year.
5. Paying subscribers for music in India are quite low(~1%) and they are expected to grow to 2-3% which will help the company.
Debt free, promoter holding 75%, 15%+ ROCE, revenue affected in near term due to less advertising spend because of Corona, last year Free Cash Flow of 29 Cr and company is trading with market cap of 360 Cr. Chart is suggesting good fundamental news will start flowing in.
Mentioned at 215 and in 8 days stock is now up by 28% in such a chaotic market and now trading at 276. One can always be wrong in the market, and in this stock that point is closing below 194.
Disclaimer: Posts on the platforms of BN are our perspective on the market. These are purely meant for learning purposes. The perspective provided should not be construed as investment advice or solicitation to trade. We may have positions in the stock mentioned. You agree to make no trade relying on the above contained information fully or partly. By using the content, you agree to these T&Cs.
Why saving is important and before that earning. Without earning there can not be saving.
Taking good care of your personal finance – budgeting, saving and investing – is often derided in young and cool circles specially if you have just started earning few years back.
First and most obvious question that comes to mind is why you should care about personal finance at all?
In one sentence: Because it’s your money.
Further you work hard, you slog like anything, you spend most of your time living time earning it. That’s why. Good enough reason?
Those who mock idea of saving and those who save prudently realize its value in the last decade or two of their lives. But you know the irony, by that time its all too late to have got this realization.
Balance between living today & saving for tomorrow is must. If you have to err then err on the side of saving more aggressively than spending aggressively.
Saving and investing for your family’s secure future is exception and tiny minority only is able to do it.
Be that minority.
Disclaimer: Posts on the platforms of BN are our perspective on the market. These are purely meant for learning purposes. The perspective provided should not be construed as investment advice or solicitation to trade. We may have positions in the stock mentioned. You agree to make no trade relying on the above contained information fully or partly. By using the content, you agree to these T&Cs.