Weekly Portfolio Review –17 July 2010

As at the end of the past week, return on the Drops’ suggested portfolio stands at 6.87% with an average investment period of 1.68 months. BSE Sensex gained 0.69% and NSE Nifty 0.77% in the past week while my portfolio returned 0.04%. My year to date return is 7.94% while Sensex gained 2.81%. In the month to date top gainers in my Portfolio are Bharti Airtel (13.47%), Tata Communications (10.60%), Blue Star (9.23%) and NIIT Tech (6.44%) and top losers were Biocon (-3.33%) and Hero Honda (3.13%).

Good buys in my watch list

Company Sector Current price 3 years Target Expected Return
Bharti Airtel Telecom 298.70 531.00 78%
Maharashtra Seamless Metal 402.15 707.00 77%
Hindustan Unilever FMCG 266.05 456.00 73%
GAIL Energy 441.75 684.00 55%
Mahindra & Mahindra Auto 604.10 925.00 53%

GAIL and Mahindra & Mahindra are new entrants in the good buys list.

–  Bharti Airtel, the number one GSM operator, added three million new users in June, taking its total subscriber base to 136.6 million. Bharti is the leader with a 29.92 per cent market share. Indian GSM telecom operators added 12.29 million new subscribers in the month of June, taking the all-India GSM cellular subscriber base to 456.58 million, according to Cellular Operators’ Association COAI report released last week.

– Bharti Airtel announced that the company would do a brand launch in Africa in October and that the capex plan for the first year of operation, ending March 2011, is around $800 million. It will partner with existing players in the continent to share infrastructure to reduce operational costs. Bharti Airtel’s annual debt servicing cost for its African deal has been pegged at $200 million. Bharti Airtel has won a key concession from the government as it prepares to invest Sh12 billion on its network in Kenya, including the construction of its headquarters in Nairobi and the establishment of a call centre that will employ 1,000 people.

– As per a survey by telecom industry journal Voice & Data, the telecom services industry posted a meagre growth rate of 2.5 per cent in revenues at Rs 1,59,510 crore in 2009-10 due to intense domestic tariff war. The industry had seen a robust growth of 20 per cent in revenues at Rs 1,55,683 crore in 2008-09. Despite a near 50 per cent subscriber growth, the mobile services segment grew a meagre 3.6 per cent to Rs 96,860 crore from Rs 93,522 crore. Tariff cuts and introduction of 1 paisa per second calling introduced by new players forced leading players to cut rates.

– A Business Line report last week shows that HUL was planning to intensify its rural push for brands. Speaking to Business Line, Mr Sudhanshu Vats, Vice President, Home Care and Skin Cleansing, HUL, said, “Deep down in India, the frequency of usage of FMCG categories is low. We want to drive consumption reaching out to the top villages in the top states. Our target is to reach out to 50,000-60,000 villages with experiential and educational campaigns for our brands.”

– With a Buy recommendation, The Hindu Business Line reported that GAIL plans to almost double its pipeline network and capacity over the next four-to-five years. The company’s massive expansion plans in the gas market and regulatory upsides are reasons to invest in the stock. They count the company’s strong positioning, good performance and massive expansion plans in the burgeoning Indian gas market, where demand growth outpaces rapid growth in supplies as reasons for upside.

– The Hindu Business Line finds the Mahindra and Mahindra as a good buy due to its presence in almost all segments, promising launches and initiatives on the farm equipment front. With strategically-priced launches like the Xylo, M&M had a dream run in FY-10.

Drops Model Portfolio

If you have been investing following my Good Buy List as above, now you would have accumulated shares of 12 companies. As of end of the past week, the average investment period is 0.14 year and gave a return of 6.87%. Download the spreadsheet for the detailed study. Last week there were 5 companies in good buy list. Since Top Ten holding is 88% of the total value and all except NTPC are already in the top ten holding, only NTPC was taken as bought in the last week.

The top 5 companies:

Company No. of Shares Market Value Return % Weight Rank
Bharti Airtel 36 10,753.20 6.92% 12% 1
Crompton Greave 39 10,590.45 5.35% 12% 2
NIIT Tech 58 10,544.40 6.84% 12% 3
NTPC 50 9,912.50 -0.91% 12% 4
Geometric 80 6,500.00 31.34% 8% 5

Top gainers to date:

Company No. of Shares Market Value Return % Weight in Portfolio Rank in Portfolio
Geometric 80 6,500.00 31.34% 8% 5
HUL 21 5,587.05 13.36% 6% 8
Cadila Health 9 5,706.90 13.22% 7% 7
Bharti Airtel 36 10,753.20 6.92% 12% 1
NIIT Tech 58 10,544.40 6.84% 12% 3

Top losers!

Company No. of Shares Market Value Return % Weight Rank
NTPC 50 9,912.50 -0.91% 12% 4

Valappil’s Portfolio

Return

Period Valappil’s Portfolio BSE Sensex NSE Nifty
This month 2.13% 1.45% 1.54%
This Year 7.94% 2.81% 3.71%
Since 1-1-2009 121.02 86.13 82.29
Since 1-1-2008 48.55 -11.14 -11.28
Since 1-4-2007 84.56 37.36 41.14

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 15 2.9 Years 66
Tata Tea FMCG 10 1.66 Years 125
Bharti Airtel Telecom 9 6 months 3
Dabur India FMCG 6 3.33 Years 168
Maharashtra Seamless Metal 6 0.5 month 1

Shares I bought this month

Company Average Price
Maharashtra Seamless 388.88
NIIT Tech 176.30
NTPC 198.28

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 168 26 months
Dabur India 137 40 months
Tata Tea 125 20 months
Berger Paints 90 41 months
Infosys 66 34 months

Archive of previous portfolio reviews


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