BC SCREENERS
Saved by @SAnngeri

A very pertinent question investors ask:-

"When to sell a stock?"

A small thread🧵which can help u in this process

Hit "Retweet" to educate maximum investors

Lets go👇

(1/20)

 First things first:-

There is no set methodology to decide when to sell a stock.

Everybody has their own framework.

These are just some pointers that work for us.

One should create their own framework

(2/20)
Many investors have an anchorship bias.

They never sell in loss even if the fundamentals are deteriorating.

Numerous examples like Yes Bank,DHFL,Vodafone Idea can be seen where retail investors are now stuck.

Don't shy away from admitting mistakes and taking losses

(3/20)
So when to sell a stock?

1. Framework for investment not working out:-

Fundamentals of the company deteriorate:-

When we invest in a company....we create a broad vision of how the targets the company will achieve in the next 3-5 years.

(4/20)
Each quarter we just make sure that the company is slowly moving toward the guided path.

There can be delays due to business realities.

If the company completely digresses from the required path!

Eg:-

Since 2018,Sterlite tech saw a sharp deterioration in fundamentals

(5/20)
The Classic Case of deterioration in fundamentals has been Vodafone Idea:-

The company has been consistently losing subscribers which is making the company fundamentally weak.

(6/20)
2. Management woes:-

Sometimes the top management leaves the company

For eg:-

Strides and Solara have seen a complete rejig in the top management

(7/20)
The management enters a new business that is not exactly value accretive to the company.

For eg:-

Balaji amines entered the LED business or the Hotel business

(8/20)
Many times management refuses to share the details about the business transparently

For eg:-

Sterlite technologies refused to share details of the fibre optic price fall...which led to investors not understanding the fall in share price.

(9/20)
Overpromise and Underdeliver:-

Many times the management gives out aggressive growth plans only to give some reason or the other to not meet the targets

Eg:-

Varroc engineering gave aggressive growth targets in 2018.

Only to never meet those targets till 2022

(10/20)
3. Wrong entry in a cyclical sector

If u enter a cyclical sector at peak sentiment..u may get stuck at the wrong price.

For eg :-

2017 was the auto sector peak,Maruti touched Rs.10,000.

From then on a severe down cycle followed and the stock never breached that price

(11/20)
Getting stuck in cyclical sectors at the wrong price can be extremely brutal

Tata Steel had a high of Rs 849 in 2008.
The stock breached this high only in 2018.

10 long years of extreme pain.

(12/20)
4. Overvaluation:-

We have seen many overvalued stocks like Kotak, Vinati, Astral, Divis, etc go on and create huge wealth for investors!

What is overvalued may remain overvalued for 10-15 years and create great returns!

(13/20)
So what to do when a stock is overvalued?

You must identify the sector in which the company operates in

1. Cyclical or
2. Secular compounders

On cyclical sectors, u should exit as soon as everybody wants to buy them.

(14/20)
On long-term compounders rather than think about selling the stock, one should think about averaging upwards!

Long-term compounders will continue to surprise.

The latest example is the spectacular rise of Tata Elxsi

10x bagger in the last 3 years

(15/20)
5. Fraud/Regulatory Action/Auditor Resignation

As soon as u discover a fraud or an auditor resignation one must not think twice and sell the stock

Numerous examples of this have been seen

PNB with Mehul choksi scam
Manpasand beverages with auditor resignation

(16/20)
6. Spot better opportunities:-

If you spot a better company with better business/capital allocation and overall better return generating opportunities.

Even if u need to sell the existing stock in a loss....one must not shy away!

(17/20)
What if u need money?

Never interrupt equity compounding for the want of money

Please create

1. Insurance
2. Emergency corpus
3. Asset allocation

So that u can first touch other assets before u touch equities

Needing money should be the last reason to sell ur stocks

(18/20)
Conclusion:-

1. Selling is not easy and the entire process is a piece of art.
2. No clear rules govern the process of selling.
3. If u get a buy good price on steady compounders....try to average them up

(19/20)
4. Sell Cyclicals as soon as every retail investor wants to buy them
5. Business fundamentals deterioration will provide clues to sell
6. Concentrate secularly on management performance.

Dont marry a stock....be ready to sell as soon as there are signals!

Cheers!😄

(20/20)

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How big is India's Infra push?

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Another $7 Trillion will be spent in the next 9 years!

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HDFC Bank has announced a merger with HDFC Ltd

What does it mean for the banking system and the shareholders of both companies?

A thread🧵explaining the pros and cons of the merger.

Hit "Retweet" to educate maximum investors

Lets go👇

(1/19)


What is happening?

HDFC Bank will take over HDFC Ltd....effectively making a huge bank

25 shares of HDFC ltd will receive 42 shares of HDFC Bank.

(2/19)


Potential to be India's largest Bank?

HDFC Bank+HDFC total size=18 lakh crores
SBI total size=26.5 lakh crores

With steady loan growth over the next 5 years....surely HDFC Bank will become the largest bank

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Over the past year ICICI scored big time on HDFC Bank due to rapid growth on home loans.
ICICI clocked up about 24% loan growth while HDFC Bank did not have a home loan portfolio.

(4/19)


So why merge now?

The regulatory arbitrage b/w Banks and NBFCs is slipping away:-

The IL&FS crisis hit the economy really hard.

Since then the RBI has taken various steps in NBFCs:-
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(5/19)
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So many terminologies in Banking!

Confused?😥🤔

Dont worry.

A thread🧵 on basics of Banking

Hit "Retweet" to educate Maximum Investors

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Types of banks:-

Your money should be parked in scheduled commercial Banks

Scheduled Commercial Banks
-PSU Banks
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Do not park money is Co-operative/Regional Banks

List is shown below

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NPA, NPA, NPA! Kya hain yeh NPA?🤔

Gross NPA (GNPA)-

It is the total loans on which no payment has been paid for 90 days or more.
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Net NPA (NNPA)-

The total figure left after deducting provisions made for bad loans from GNPA.
(GNPA – Provisions+upgrades/writeoffs = NNPA)

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Special Mention Account (SMA) –

SMA-0

SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days.

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Parag Parikh Flexi Cap has been an investor favorite over the past 2 years.

Should u chase the fund?

An in-depth thread🧵 analyzing the performance and strategy of the fund.

Hit "Retweet" to educate maximum investors.

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Scheme:-
Parag Parikh Flexi Cap fund

Fund Manager:-
Mr Rajeev Thakkar

AUM:-
29,294cr

(2/20)

PPFAS has been the vision of the great Late Parag Parikh.

A true Value Investor.....who lost his life while attending a Berkshire Hathway AGM.

The Mutual fund has tried to remain true to the investing concepts laid by Late Mr Parag Parikh.

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Fund Manager:-

Mr Rajeev Thakkar possesses over 15 years of experience.

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Mr.Thakkar is a Chartered Accountant, Cost Accountant, CFA, and CFP. He has been associated with PPFAS AMC since 2013.

Mr Thakkar has been the lead fund manager at PPFAS Mf ever since launch.

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Benefits of writing SRI RAMA Jayam!!!

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You can write this in any language of your choice. It is the connecting chords with the divine and your inner self.

Below are some points that we came across on the benefits :

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1. Vedas tell that as the sun dispels the darkness, the chanting of Rama Nama dispels all evil and obstacles of life. It is a way of liberation and salvation of human suffering.

2. When you think, that all roads are blocked to walk away from day to day problems..

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writing ‘Sri Ram Ram Ram’ gives you the most needed clarity of thoughts to find away out of odd situations.

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Once Parvathi & Shiva were relaxing in the pleasant gardens of Mount Mandhara.


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दधीचि ऋषि को मनाही थी कि वह अश्विनी कुमारों को किसी भी अवस्था में ब्रह्मविद्या का उपदेश नहीं दें। ये आदेश देवराज इन्द्र का था।वह नहीं चाहते थे कि उनके सिंहासन को प्रत्यक्ष या परोक्ष रुप से कोई भी खतरा हो।मगर जब अश्विनी कुमारों ने सहृदय प्रार्थना की तो महर्षि सहर्ष मान गए।


और उन्होनें ब्रह्मविद्या का ज्ञान अश्विनि कुमारों को दे दिया। गुप्तचरों के माध्यम से जब खबर इन्द्रदेव तक पहुंची तो वे क्रोध में खड़ग ले कर गए और महर्षि दधीचि का सर धड़ से अलग कर दिया।मगर अश्विनी कुमार भी कहां चुप बैठने वाले थे।उन्होने तुरंत एक अश्व का सिर महर्षि के धड़ पे...


...प्रत्यारोपित कर उन्हें जीवित रख लिया।उस दिन के पश्चात महर्षि दधीचि अश्वशिरा भी कहलाए जाने लगे।अब आगे सुनिये की किस प्रकार महर्षि दधीचि का सर काटने वाले इन्द्र कैसे अपनी रक्षा हेतु उनके आगे गिड़गिड़ाए ।

एक बार देवराज इन्द्र अपनी सभा में बैठे थे, तो उन्हे खुद पर अभिमान हो आया।


वे सोचने लगे कि हम तीनों लोकों के स्वामी हैं। ब्राह्मण हमें यज्ञ में आहुति देते हैं और हमारी उपासना करते हैं। फिर हम सामान्य ब्राह्मण बृहस्पति से क्यों डरते हैं ?उनके आने पर क्यों खड़े हो जाते हैं?वे तो हमारी जीविका से पलते हैं। देवर्षि बृहस्पति देवताओं के गुरु थे।

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