After writing on Banking & Paints, this thread focuses on the 'Logistic Sector'. Idea is to give a small start to the retail investors looking at investing in this space from where they can build on.

This thread covers,
- Macro
- Business Model
- 3PL & 4PL
- Valuation (1/n)

Logistics business macro

-14% of India’s GDP is spent on Logistic
-Organized market is 42%
-Growing at 10-15%
-Employs 2.2 cr
-Achieved Infrastructure status
-FY 14-18 attracted 1,00,000 cr FDI (2/n)

What’s the business?

Logistic is traditionally seen as a warehousing & transportation business where goods, needs 2b transported 4m point A to B using Road, Rail, Ship or Air & can be stored at multiple warehouses before the consumer receives the product (3/n)

The business landscape is changing fast with newer competition and technology is challenging the older business models. 3PL (3rd party logistics) & 4PL is one such change in the business of logistics, will discuss about the same ahead. (4/n)

Listed companies involved in the business may or largely may not own the Trucks, Rails, Aircraft, Ships, Warehouses etc., but uses outsourced services of other vendors and the listed companies manage the logistics from point A to point B (5/n)

60 minutes of live session on how to do your own stock research for trading with examples.

Nifty and RSI divergence. It is all about knowing your indicator well. Quick video (Hindi) :-)

Outside followed by inside bar is one of the best pattern to trade.

What does outside bar means?
- Outside bar is when current candle high > previous candle high & current candle low < previous candle high

(1/n)

What does inside bar means?

- Inside bar is when current candle high < previous candle high & current candle low > previous candle low.

(2/n)

What to interpret from outside bar?

- When we get outside bar which means neither buyer nor seller are in control.
- When we get outside bar, we should wait for the follow through/confirmation in next candle.

(3/n)

What to interpret from inside bar?
- volatility is getting compressed.
- both buyers and sellers are waiting for next trigger to create fresh position/ close their existing positions.

(4/n)

What to interpret from OB+IB pattern?

- this is one of the best formation we can get to take a trade.
- Outside bar + Inside bar = Rejection on both side + compression of volatility.

(5/n)

Is HDFC undervalued ?

Market capitalisation of HDFC is 3,10,478 Crores. But HDFC houses listed holdings worth 2,19,437 Crores and several unlisted businesses.

FY20 profit was 21,435 Crores. Setting aside the holdings, HDFC is trading at a PE of 3-4.

Let's dig deeper. A thread.

About HDFC

They are the leaders in housing finance.

AUM: 5,16,773 Crores
Secured Lending: 97%
CAR: 17.6%
NIM: 3.4%
Average Individual Loan: 27 Lakhs
Deposit Agents: 24000
Employees: 3095
Assets Per Employee: 163 Crores
Profit Per Employee: 3 Crores
Auditor Fees: 5.28 Crores

HDFC Bank

HDFC owns 21.24% of HDFC Bank. The stake is worth 1,22,812 Crores. In FY20 HDFC Bank paid a dividend of 864 Crores to HDFC.

HDFC sources 26% of the loans through HDFC Bank. HDFC Bank has the right to buy 70% of the loans sourced.

Performance of HDFC Bank:

HDFC Life

HDFC owns 51.44 of HDFC Life. The stake is worth 61,779 Crores. HDFC Life didn't pay a dividend last year adhering to the suggestions from IRDAI.

RBI has directed HDFC to bring its shareholding in HDFC Life to 50% by 16th December 2020.

Performance of HDFC Life:

HDFC AMC

HDFC owns 52.7% of HDFC AMC. The stake is worth 27,230 Crores. Last year HDFC AMC paid a dividend of 135 Crores to HDFC.

AUM: 3.7 Lakh Crores

Performance of HDFC AMC:

OHLC - Open, High, Low & Close

Everybody that looks into the charts absolutely must know what OHLC means.

Doesn't matter which TF you are looking at, each candle consists of these.

- Wick is the thinnest of the volume of the candle
- Body is the strongest - Most Volume traded

Anatomy of an OHLC in the making.

Each candle on any TF or any market forms this way. It doesn't matter whether this is a Monthly candle or a 1-minute candle

Each candle will have its own OHLC data.

Each candle starts with "O", then shapes "H" and "L" and ends with "C"

Understanding this anatomy is absolutely crucial for your future development in navigating yourself in the markets

OHLC are also the most significant levels in the markets especially on the higher timeframes such as Daily, Weekly and Monthly.

Education on SWINGS

Understanding what is a Swing is crucial in order to understand Market Structure.

It shows us the direction of the market and while it may seem obvious at first sight of the market, many still have trouble defining what a swing is.

You could define swing as simply more then 2 consecutive candles moving in one direction

When you get a few in the opposite direction you have another one

The important thing to note is that HTF swings always have more priority than LTF swings

When you zoom-in from an HTF to an LTF you will always find that one HTF swing always consists of many smaller and smaller lower timeframe swings.

You could refine this until you'd get to a 1-minute chart or even a tick chart and still you'd see the same thing happening in there

An important thing to realize is that you can have many smaller swings inside of one, big swing, and you gotta orientate yourself in this.

This takes time and practice to see as all things do but will give you an immense power over the rest when you do.

Swings also do not have to break it's previous high or low. They can happen in a contraction with HL and LH also commonly known as triangles.

You can also have many moves inside of a one Monthly Bar.

How to sell option?
Here let me explain through simple math.
Say BN at 30000
30000 straddle trading at combine premium 800 ( based on current volatility)
Put at 400
Call at 400
You don’t know direction. Sold both.

If move will not come than both will decrease gradually.

At day end it will come down to 720-740 if move will not come. Difference is your profit.

Now case 2:
Move started.
At one points combine premium will start increasing.
Say 810.
Exit immediately. No need to do adjustment.
Let market settle.

Sell again straddle once market settle.
Now repeat same thing.

Straddle selling webinar over.
Good luck.

One can keep SL 550 for both strike to escape from sudden movement.

Which PMS or Advisory in your view is doing a phenomenal job (not only on returns) but in educating the investor or cultivating the client deeper into the subject of investing...?

The absolute best 15 scanners which experts are using.

Got these scanners from the following accounts:

1. @Pathik_Trader
2. @sanjufunda
3. @sanstocktrader
4. @SouravSenguptaI
5. @Rishikesh_ADX

Share for the benefit of everyone.

Listing all scanners from @Pathik_Trader Sir first.

1. Open

2. 80-20 Reversal Setup


3. Fake

4. Trapping Inside Bar (Positional Setup)

We have a habit of looking west and thinking what they do must be right. With all the craziness going on in the US capital markets, I thought it will be a good time to share some of the reasons why India is way better in terms of capital market regulations. 1/n

In US, hedge funds can leverage unlimited & run positions worth hundreds of $billions bringing in systemic risk. In India, no one can hold overnight positions more than ~5 times leverage (SPAN+Exposure for F&O, VAR+ELM for stocks). Even intraday leverages are now capped 2/n

In US your stock holdings are held by the brokers (held in book or street name, also the reason for the large stock lending market). If a broker goes down, your securities is at risk as well. In India, they sit in your Demat with NSDL/CDSL, ring-fenced from any broker risk 3/n

In the US your broker has an option to send the order placed on the trading platform to the exchange or a high-frequency trading firm that pays for the order. As you’d guess most orders are sent to HFT firms. In India, all order matching has to happen on the exchanges 4/n

In US a broker can act almost like a bank. Hold your funds for as long, take risk & lend them to other clients as well. In India, a broker can lend only their own funds and not client funds. Also, all unutilized funds need to be returned back once a quarter to the client bank 5/n

A basic primer on the Indian Paint sector

With the listing of Indigo paints, JSW entering the paint sector & now Grasim announcing to invest 5,000 cr in the sector, lets explore,
-Products
-Industry
-Company

Do hit the ‘re-tweet’ and help us educate more investors (1/n)

Lets start with PRODUCTS

India paint industry is broadly divided into two,
(1) Decorative Paints (used mainly in residential & office infrastructure)–75% of the total paints market
(2) Industrial Paints (used in Auto & other industrial uses)-25% of the total paints market (2/n)

Decorative Paints is further classified as
a. Primer & Putty–They r applied 2 the wall 2 fill the cracks in the wall & make it smooth b4 painting. It also gives a lasting effect to the paint
b. Thinner–Its mixed with the paint 2 reduce the viscosity,applying becomes easy (3/n)

c. Emulsion Paint – Water based premium range paint mainly used in metros & large cities
d. Enamel Paint- Oil based medium range paint for smaller cities
e. Distemper–Water based paint mainly for the rural area as it can be used on the wall directly without using the primer(4/n)

(f) Wood Coating – Used to protect furniture against moisture (5/n)

How to identify momentum stocks for intraday trading

Explained in detail with examples with a scanner to scan stocks(link in youtube description)

https://t.co/wf4EOV9Ktt

#trading #youtube #markets