Weekly Portfolio Review: 29 January 2011

You must be feeling letdown as market continue to go down mercilessly. I am not different! The loss in BSE Sensex is 10% in the month to date which is after a lacklustre year of 2010. My month to date loss also stands at 10%.

Declining foreign direct investments (FDI), widening trade deficit, escalating inflation, and RBI increasing benchmark short term rates all added to fire. On global front, though American economy grew at faster pace in the fourth quarter of last year, the unemployment rate is increasing. In the UK, amid increasing inflation, the consumer confidence plunged the most since 1994 as per a report.

HDFC Securities, in its weekly report, states that market closed below the 200 day EMA (Exponential Moving Average) and it expects further downside in the coming week.

It is not end of the world. A long term investor would see such ups and downs from time to time. In 2009 the market gained about 100% after a loss of 52% in 2008. It was just 17% gain in 2010! For a long term investor, the downturn in the market must be seen as opportunity to enter into fundamentally sound companies.

I am not buying anything in the coming week. There are a number of good companies available at attractive valuation. However most of them are trading below their daily moving averages. My investment decisions have never been based on technical analysis. But technical trend will give an indication of good entry/exit point. Sometimes it may turn out to be a wrong decision. Nobody can predict the market and we can’t say how far it will go down!


Weekly Portfolio Review: 23 January 2011

My portfolio lost 1.15% in the last week while BSE Sensex gained 0.78% and NSE Nifty 0.74%. The loss in the month to date for Sensex and Nifty is 7% and for my portfolio 6%.

Top gainers                                           Top Losers

Opto Circuits 10.88% Zensar Tech 7.11%
HCLT 6.36% GAIL 6.88%
Tata Communications 2.96% Mangalam Cement 4.99%
Ess Dee Aluminium 2.03% Amara Raja Batteries 4.99%
Tech Mahindra 1.77% Tractors India Ltd 4.21%

I bought Swaraj Engines, Bharti Airtel, Zensar Technology, Honeywell Automation and Clariant Chemicals in the last week.

So what’s next? Continue buying in instalments!

Good buys in my watch list

Company Sector 3 Years Target Current Price Expected Margin
Mazda Ltd Engineering 207.00 108.50 91%
Zensar Tech IT 318.00 167.20 90%
Honeywell Automation Engineering 4,100.00 2,394.85 71%

I will be buying all of the above in small quantities in the coming week.

Mazda Ltd is new to my portfolio. It is predominantly an engineering company producing different types of engineering equipments used by various industries. It has also ventured into food segment with brand name of BCool!


Mazda Ltd

Mazda Limited is predominantly an engineering company producing different types of engineering equipments like vacuum systems, evaporator systems, air pollution control equipment. It’s one of the largest sellers of steam jet vacuum systems and condensers worldwide.

Mazda Limited has built a strategic alliance with Croll-Reynolds Inc. USA (C-R), who is a major shareholder in Mazda Controls. Croll-Reynolds has shared a substantial amount of technology with Mazda. At its facilities in Ahmedabad, Gujarat State, India, Mazda and Croll-Reynolds work together to design, manufacture and test high quality equipments for sale to all the regions of the world.

Company’s 85-90% of export orders come from Croll-Reynolds. As on date Croll-Reynolds holds 6.8% stake in Mazda Ltd. Croll-Reynolds clients in India are being served by Mazda ltd.

Divisions

Vacuum, Evaporators and Food

Vacuum division produces Steam Jet Air Ejector (SJAE) System, Chill Vactors Systems, Surface Condenser, Heat Exchanger, Feed Water Heater

Evaporators division produces Forced Circulation Evaporators, Combination Type Evaporators, Air Pollution Control Equipment

Food division produces Bcool brand soft drink concentrates, essences and jams etc and also supply for private labelling.

Consuming Industry

The equipments manufactured by the company are widely used in the petrochemicals, power generation, fertilizer manufacturing, chemical, bulk drugs, edible oil extraction, steel manufacturing and other industries.

ML’s clients include Reliance Industries, Indian Oil Corporation (IOC), Siemens, Triveni Engineering, Aventis, Clariant Group, Unilever, Kvaerner Gas Power, Bhel, Cadila Transpek, United Phosphorus, Voltas, Atul, Grasim, Aarti Group, Wockhardt, Jacobs, Sterlite, Thermax, Shasun, Unilever, Atul, and GHCL among others. ML also supplies its products to the Nuclear Power Plants at Tarapore.

Industry

Engineering

Peer Group

Thermax, BEML Ltd, Alfa Laval,

Related Links

Updates on Drops Savings | Company website | BSE Market Tracker | Information at Moneycontrol.com | Information at HDFC Securities


Weekly Portfolio Review: 16 January 2011

My portfolio lost 3.15% in the last week, the biggest weekly loss in over a year. BSE Sensex lost 4.22% and NSE Nifty 4.23%. The loss in the month to date for Sensex is 8.04%, for Nifty 7.82% and for my portfolio 4.79%. Inflation continued to be the major news that affected the market negatively.

Zensar Technology, NIIT Technology and Bharti Airtel gained 1% to 4% while TIL, L&T, GAIL and Reliance lost 6% to 8%. I bought Tech Mahindra, Zensar Technology and Clariant Chemicals in the last week.

The market may go up or down J , but what an investor should do is use the opportunity to buy good companies at a better price. Keep buying, slow and steady.

Good buys in my watch list

Company Sector 3 Years Target Current Price Expected Margin
Swaraj Engines Auto Ancil 850.00 471.65 80%
Zensar Tech IT 318.00 180.00 77%
Honeywell Automation Engineering 4,100.00 2,362.90 74%
Bharti Airtel Telecom 551.00 342.70 61%
Clariant Chemicals Chemicals 1,095.00 735.25 49%

I will be buying all of the above in small quantities in the coming week. All of them are already in my portfolio.  Even though it is advised to diversify into multiple companies, it is better to keep within a manageable numbers.  I have 33 companies at present, but would bring it down to 30 as soon as I get an opportunity to sell some of them at a good price.


Weekly Portfolio Review: 08 January 2011

BSE Sensex lost 817 points (3.98%) to close the week at 19,692 and NSE Nifty 230 points (3.75%) to close at 5,905. My portfolio lost 1.69% in the week. In my portfolio, Opto Circuits lost 10.9%. Other major losers were L&T, Oil Country Tubular, Hero Honda, Bharti Airtel and Biocon which lost 5% to 7%.   Zensar Technology and GAIL were major gainers.

Interest rate hike fears amid raising inflation affected the market negatively and going forward it will be a great concern in the short term. Interest rate hike will affect the overall economic activities in the country while food inflation may continue in top gear due to supply constraints.

Good buys in my watch list

Script Sector 3 Years Target Current Price Expected Margin
Mangalam Cement Cement 400.00 133.25 200%
Tata Sponge Iron Metal 700.00 366.00 91%
Zensar Tech IT 318.00 173.25 84%
Tech Mahindra IT 1,074.00 707.95 52%
Clariant Chemicals Chemicals 1,092.00 751.05 45%

I will be buying Zensar Technologies, Tech Mahindra and Clariant Chemicals in coming week.

Clariant Chemicals is a new entrant to my portfolio. Clariant Chemicals (India) Limited is one of India’s leading specialty chemicals companies and is the No. 1 player in  pigments, textile chemicals, leather chemicals. Its products serve a wide range of industries from consumer goods to oil and gas. . www.clariant.in

Zensar Technologies is a globally focused software and services company spread across eighteen countries across the world. Zensar provides end-to-end services from IT development to Business Process Outsourcing, from consulting to implementation.

Tech Mahindra is part of the Mahindra Group, in partnership with British Telecommunications plc (BT), one of the world’s leading communications service providers. Focused primarily on the telecommunications industry, Tech Mahindra is a leading global systems integrator and business transformation consulting organization. Tech Mahindra expanded its IT portfolio by acquiring the leading global business and information technology services company, Mahindra Satyam (earlier known as Satyam Computer Services). www.techmahindra.com

Interesting Read

New arena for 2-wheeler firms

With global markets open to the Hero Group after its split with Japan’s Honda Motor, the next battleground for Indian two-wheeler companies could be overseas. Until now, the joint venture was restricted from exporting freely to other markets and was forced to ship to a handful of countries through Honda subsidiaries. http://www.business-standard.com/taketwo/news/new-arena-for-2-wheeler-firms/420613/

My Portfolio

Return

My Portfolio BSE Sensex NSE Nifty
This Week -1.69% -3.98% -3.75%
Since 1-1-2010 10.21% 12.75% 13.53%
Since 1-1-2009 125.66% 104.12% 99.55%
Since 1-1-2008 51.68% -2.55% -2.88%
Since 1-4-2007 88.44% 50.64% 54.51%

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 7 3.2 Years 102
Graphite India Engineering 6 3 Months 7
HUL FMCG 5 5 Months 19
KSB Pumps Engineering 5 3 Months -5
Divi’s Laboratories Pharma 5 2 Months -9

Shares I bought this month

Company Average Cost
Amara Raja Batteries 195.57
Zensar Technology 170.48
Oil Country Tubular 98.45

Shares I sold this month

Company Average Price

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 209 2.7 Years
Dabur India 152 4.7 Years
Tata Global Beverages 103 2.2 Years
Berger Paints 148 3.8 Years
Infosys 102 3.2 Years

Top 5 most loss (absolute)

Company Return % Average Holding Period
Opto Circuits -19 2 months
Ess Dee Aluminium -5 2 month
Tata Communication -25 12 months
Mangalam Cement -15 3 months
Divi’s Laboratories -9 2 months

Archive of previous portfolio reviews

Clariant Chemicals (India) Limited represents a valuable repository of manufacturing and marketing experience. Its constituents were all well respected companies who played an invaluable role in the development of the textiles, leather, paints, plastics, printing inks and agrochemicals industries in India. Today Clariant Chemicals (India) Limited is – No.1 in pigments, No.1 in textile chemicals and No.1 in leather chemicals.


Honeywell Automation India Ltd. (HAIL)

Honeywell Automation India Ltd. (HAIL) is a leading provider of integrated automation and software solutions that improve productivity, enhance comfort and ensure safety and security of homes and business premises. With over 2500 employees and an annual turnover of about Rs. 868 crores, HAIL is headquartered in Pune with 8 offices all over India. It is part of Honeywell Inc. the technology leader with 120,000 employees across 100 countries world wide.

HAIL has an impressive 36000 sq ft. state-of-the-art manufacturing facility in Pune, and is the first Automation and Control Solutions company in India to receive double certifications of ISO 9001 and OHSAS 18001 certifications.

Honeywell International is a $36 billion diversified technology and manufacturing leader, serving customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products; turbochargers; and specialty materials. Based in Morris Township, N.J., Honeywell’s shares are traded on the New York, London and Chicago Stock Exchanges.

Divisions

Honeywell Process Solution, Honeywell Building Solutions, Global Engineering Services, Environmental and Combustion Control, Sensing and Control and Honeywell Security Group.

Consuming Industry

It serves a wide range of industries that include Infrastructure, Petrochemicals, Refining, Chemicals, Mining & Metals, Automobiles and Hospitality.

Honeywell brands can be seen on the thermostats in buildings, in the electronic voting machines, process control systems in refineries and factories or as sensors in automobiles.

Industry

Industrial Electronics/Consumer Durables/Engineering

Competitors

Siemens, Bharat Electronics, Opto Circuits etc.

Related Links

Updates on Drops Savings | Company website | NSE Market Tracker | Information at Moneycontrol.com | Information at HDFC Securities

Maharashtra Seamless

Maharastra Seamless Limited (MSL) is one of the flagship companies of D.P. Jindal Group. Incorporated in the year 1989, Maharashtra Seamless Limited (MSL) is leading manufacturer of Seamless, ERW Carbon and Alloy Steel Pipes and Tubes in India. Its plant at Raigad in Maharashtra has a capacity of 3,500,000 MT p.a. of Seamless Pipes and 2,000,000 MT p.a. of ERW pipes and external and internal coating facility. Both Seamless & ERW Plants are first of its kind in India and are having Technical Tie-up with SMS MEER (earlier known as MANNESMANN DEMAG) of Germany. MSL enjoys 45% market share of seamless pipes in India.

It has forayed in to wind power generation business for captive consumption leading to low cost of power and substantial saving thereby. At Satara in Maharashtra, it has 20 wind turbine generators with an aggregate capacity of 7 MW.

Division

Seamless, ERW and Power

Products

Seamless Pipes and Tubes: Hot finished pipes & tubes, cold pilgered / cold drawn tubes, API oil country tubular goods (OCTG) range, line pipe

ERW pipes: ERW line pipe; steam, water gas and air line ERW pipes, ERW casing pipes

Consuming Industry

Seamless Pipes have wide application in high pressure oil & gas exploration & drilling, boiler, automobiles, process, pipelines, refineries.

ERW Pipes are used for low pressure application in cross country line pipes for oil & gas and water transport.

Maharashtra Seamless Ltd has customers across various industries such as oil & gas, Hydrocarbon and process industry, automotive Industry, bearing industry and mechanical and general engineering.

Raw Materials

Billets and Hot Rolled Coils

Competitors

Indian Seamless Tubes, Jindal Saw, BHEL, Remi Metals, Jindal Pipes, Surya Roshni, Welspun Gujarat and Oil Country Tubular.

Related Links

Updates on Drops Savings | Company website | NSE Market Tracker | Information at Moneycontrol.com | Information at HDFC Securities

Weekly Portfolio Review: 31 December 2010

With a gain of 17% for the year 2010, the Bombay stock market became the best performer among the top 10 biggest stock markets in the world.

My net return for 2010 is 12%. It is after deducting the transaction cost including provision for selling cost on my holding. The top 5 contributors in the year are Infosys, HUL, Bharti Airtel, Dabur India and Tata Global Beverages which together add up to 46% of my total gain. The top 5 losers in the year are Mangalam Cement, Suzlon Energy, Tata Communications, Divis Laboratories and L&T which ate 29% of my total gain. In fact shares that are in loss took away 48% of total gain!

My hope for 2011 is on my holding which are in red at present. They are good companies and reversal of sentiments will guide those shares to reach higher and will give me a good return. Shares that hold 40% of total value of my portfolio are in red.

I have been paying hefty charges for brokerage with ICIC Direct. My average buying cost with ICICI Direct is 1.52% including taxes. I started using HDFC securities since last week and the average cost with them is 0.97% including tax which makes considerable savings on transaction cost. My target for 2011 is to completely shift demat and brokerage account to HDFC Securities.

Good buys in my watch list

Script Sector 3 Years Target Current Price Expected Margin
Mangalam Cement Cement 400.00 132.05 203%
KSB Pumps Engineering 1,072.00 531.40 102%
Maharashtra Seamless Metal 762.00 382.35 99%
Tata Sponge Iron Metal 700.00 363.20 93%
Zensar Tech IT 318.00 166.65 91%
Oil Country Tubular Metal 173.00 96.85 79%
Honeywell Automation Engineering 4,100.00 2,364.90 73%
Divis Laboratories Pharma 1,095.00 645.70 70%
Swaraj Engines Auto Ancil 850.00 501.70 69%
Shanthi Gears Engineering 71.00 44.80 58%
Amara Raja Batteries Auto Ancil 301.60 191.20 58%
Bharti Airtel Telecom 551.00 358.40 54%
Tech Mahindra IT 1,074.00 702.40 53%

I will be buying Zensar Technologies, Oil Country Tubular and Amara Raja Batteries in coming week. My cap on top 10 companies is 50% of total value and at present it has crossed the limit. That is why I am not buying some of the top in the above list this time.

Interesting Read

Shariah 50 index: The whys and the hows

BSE and TASIS have conducted a back-test of the index from 1/1/2008. As per this the BSE TASIS Shariah index has outperformed both the BSE-Sensex and the BSE 500 over all time periods. This demonstrates that the stocks which have been selected using the Shariah conditions are fundamentally sound. http://www.equitymaster.com/detail.asp?date=1/1/2011&story=1&title=Shariah-50-index-The-whys-and-the-hows

Consumption key to India growth story

Consumption is the sole purpose of all production. When a steel manufacturer says it is adding new production capacity, one can assume that people are buying more cars and consumer durables. The same is true for housing, which propels the growth in cement, or for that matter, apparel purchases which stoke the growth in textiles. Clearly, when demand for consumerdriven products rises, manufacturing across segments takes a leap. When that happens, new jobs are created. This, again, boosts consumption. And so on. http://timesofindia.indiatimes.com/business/india-business/Consumption-key-to-India-growth-story/articleshow/7199390.cms#ixzz19nwaLAnT

Gas pipelines set to compete on price

The Petroleum and Natural Gas Regulatory Board (PNGRB), the downstream regulator in the energy sector, has proposed to give gas pipeline operators freedom to compete in overlapping areas so that consumers benefit by way of lower tariff and softer gas prices. Now, pipeline operators like Gail India and Reliance Gas Transportation Infrastructure do not have that freedom and have to charge the regulator-fixed tariff without a premium or discount. http://www.indianexpress.com/news/gas-pipelines-set-to-compete-on-price/730502/

BHEL & Bharat Electronics, two PSUs in top R&D spenders in India

In India Inc’s research and development firmament, it’s the Bharats that shine the brightest. Two public sector undertakings, Bharat Heavy Electricals Limited and Bharat Electronics Limited, are standout performers among brick-and-mortar companies in India. If you leave aside pharma companies, whose R&D average investments are traditionally higher owing to the research-driven sector they operate in, BHEL (Rs 830 crore) and BEL (Rs 292 crore) spend more on R&D than most of their manufacturing industry peers. While it is only recently that large sections of Indian industry have realised the importance of R&D, for both BEL and BHEL, it has been a part of their organisational DNA for more than a decade. http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/bhel–bharat-electronics-two-psus-in-top-rd-spenders-in-india/articleshow/7175544.cms

Industries: Looking back and ahead

As the year 2010 coming to an end, reports on various industries appeared across the news papers. Here are the links to those reports on the sectors related to our investments. http://dropssavings.com/2011/01/industries-looking-back-and-ahead/

My Portfolio

Return

My Portfolio BSE Sensex NSE Nifty
This Week 1.25% 2.17% 2.04%
This month 2.82% 5.05% 4.63%
This Year 12.11% 17.43% 17.95%
Since 1-1-2009 129.55% 112.60% 107.32%
Since 1-1-2008 54.29% 1.50% 0.90%
Since 1-4-2007 91.68% 56.89% 60.52%

Top 5 holding in my equity portfolio

Company Sector % of Total Value Average Holding Period Absolute Return %
Infosys IT 8 3.2 Years 106
Graphite India Engineering 5 3 Months 5
HUL FMCG 5 5 Months 19
KSB Pumps Engineering 5 3 Months -4
Divi’s Laboratories Pharma 5 2 Months -7

Shares I bought this month

Company Average Cost
Tata Sponge Iron 364.43
Graphite India 95.62
BHEL 2,339.58
HUL 302.01
Tractors India Ltd 690.22
Swaraj Engines 491.85
KSB Pumps 506.95
Honeywell Automation 2,406.00
Zensar Technology 163.94
Oil Country Tubular 89.66

Shares I sold this month

Company Average Price
Glenmark Pharma 353.32
Dr. Reddy’s 1722.27

Top 5 most gain (absolute)

Company Return % Average Holding Period
Gujarat Gas 217 2.7 Years
Dabur India 152 4.7 Years
Tata Global Beverages 103 2.2 Years
Berger Paints 154 3.8 Years
Infosys 106 3.2 Years

Top 5 most loss (absolute)

Company Return % Average Holding Period
Opto Circuits -10 2 months
Ess Dee Aluminium -5 2 month
Tata Communication -24 12 months
Mangalam Cement -16 3 months
Divi’s Laboratories -7 2 months

Archive of previous portfolio reviews

Weekly Portfolio Review: 31 December 2010

With a gain of 17% for the year 2010 in BSE Sensex, the Bombay Stock market became the best performer among the top 10 biggest stock markets in the world.

My net return for 2010 is 12%. It is after deducting the transaction cost including provision for selling cost on my holding. The top 5 contributors in the year are Infosys, HUL, Bharti Airtel, Dabur India and Tata Global Beverages which together add up to 46% of my total gain. The top 5 losers in the year are Mangalam Cement, Suzlon Energy, Tata Communications, Divis Laboratories and L&T which ate 29% of my total gain. In fact shares that are in loss took away 48% of total gain!

My hope for 2011 is on my holding which are in red at present. They are good companies and reversal of negative sentiment will guide those shares to reach higher and will give me a good return. Shares that hold 40% of total value of my portfolio are in red.

I have been paying hefty charges for brokerage with ICIC Direct. My average buying cost with ICICI Direct is 1.52% including taxes. I started using HDFC securities since last week and the average cost with them is 0.97% including tax which makes considerable savings on transaction cost. My target for 2011 is to completely shift demat and brokerage account to HDFC Securities.

Good buys in my watch list

Script

Sector

3 Years Target

Current Price

Expected Margin

Mangalam Cement

Cement

400.00

132.05

203%

KSB Pumps

Engineering

1,072.00

531.40

102%

Maharashtra Seamless

Metal

762.00

382.35

99%

Tata Sponge Iron

Metal

700.00

363.20

93%

Zensar Tech

IT

318.00

166.65

91%

Oil Country Tubular

Metal

173.00

96.85

79%

Honeywell Automation

Engineering

4,100.00

2,364.90

73%

Divis Laboratories

Pharma

1,095.00

645.70

70%

Swaraj Engines

Auto Ancil

850.00

501.70

69%

Shanthi Gears

Engineering

71.00

44.80

58%

Amara Raja Batteries

Auto Ancil

301.60

191.20

58%

Bharti Airtel

Telecom

551.00

358.40

54%

Tech Mahindra

IT

1,074.00

702.40

53%

I will be buying Zensar Technologies, Oil Country Tubular and Amara Raja Batteries in coming week. My cap on top 10 companies is 50% of total value and at present it has crossed the limit. That is why I am not buying some of the top in the above list this time.

Interesting Read

Shariah 50 index: The whys and the hows

BSE and TASIS have conducted a back-test of the index from 1/1/2008. As per this the BSE TASIS Shariah index has outperformed both the BSE-Sensex and the BSE 500 over all time periods. This demonstrates that the stocks which have been selected using the Shariah conditions are fundamentally sound. http://www.equitymaster.com/detail.asp?date=1/1/2011&story=1&title=Shariah-50-index-The-whys-and-the-hows

Consumption key to India growth story

Consumption is the sole purpose of all production. When a steel manufacturer says it is adding new production capacity, one can assume that people are buying more cars and consumer durables. The same is true for housing, which propels the growth in cement, or for that matter, apparel purchases which stoke the growth in textiles. Clearly, when demand for consumerdriven products rises, manufacturing across segments takes a leap. When that happens, new jobs are created. This, again, boosts consumption. And so on. http://timesofindia.indiatimes.com/business/india-business/Consumption-key-to-India-growth-story/articleshow/7199390.cms#ixzz19nwaLAnT

Gas pipelines set to compete on price

The Petroleum and Natural Gas Regulatory Board (PNGRB), the downstream regulator in the energy sector, has proposed to give gas pipeline operators freedom to compete in overlapping areas so that consumers benefit by way of lower tariff and softer gas prices. Now, pipeline operators like Gail India and Reliance Gas Transportation Infrastructure do not have that freedom and have to charge the regulator-fixed tariff without a premium or discount. http://www.indianexpress.com/news/gas-pipelines-set-to-compete-on-price/730502/

BHEL & Bharat Electronics, two PSUs in top R&D spenders in India

In India Inc’s research and development firmament, it’s the Bharats that shine the brightest. Two public sector undertakings, Bharat Heavy Electricals Limited and Bharat Electronics Limited, are standout performers among brick-and-mortar companies in India. If you leave aside pharma companies, whose R&D average investments are traditionally higher owing to the research-driven sector they operate in, BHEL (Rs 830 crore) and BEL (Rs 292 crore) spend more on R&D than most of their manufacturing industry peers. While it is only recently that large sections of Indian industry have realised the importance of R&D, for both BEL and BHEL, it has been a part of their organisational DNA for more than a decade. http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/bhel–bharat-electronics-two-psus-in-top-rd-spenders-in-india/articleshow/7175544.cms

Industries: Looking back and ahead

As the year 2010 coming to an end, reports on various industries appeared across the news papers. Here are the links to those reports on the sectors related to our investments. http://dropssavings.com/2011/01/industries-looking-back-and-ahead/

My Portfolio

Return

My Portfolio

BSE Sensex

NSE Nifty

This Week

1.25%

2.17%

2.04%

This month

2.82%

5.05%

4.63%

This Year

12.11%

17.43%

17.95%

Since 1-1-2009

129.55%

112.60%

107.32%

Since 1-1-2008

54.29%

1.50%

0.90%

Since 1-4-2007

91.68%

56.89%

60.52%

Top 5 holding in my equity portfolio

Company

Sector

% of Total Value

Average Holding Period

Absolute Return %

Infosys

IT

8

3.2 Years

106

Graphite India

Engineering

5

3 Months

5

HUL

FMCG

5

5 Months

19

KSB Pumps

Engineering

5

3 Months

-4

Divi’s Laboratories

Pharma

5

2 Months

-7

Shares I bought this month

Company

Average Cost

Tata Sponge Iron

364.43

Graphite India

95.62

BHEL

2,339.58

HUL

302.01

Tractors India Ltd

690.22

Swaraj Engines

491.85

KSB Pumps

506.95

Honeywell Automation

2,406.00

Zensar Technology

163.94

Oil Country Tubular

89.66

Shares I sold this month

Company

Average Price

Glenmark Pharma

353.32

Dr. Reddy’s

1722.27

Top 5 most gain (absolute)

Company

Return %

Average Holding Period

Gujarat Gas

217

2.7 Years

Dabur India

152

4.7 Years

Tata Global Beverages

103

2.2 Years

Berger Paints

154

3.8 Years

Infosys

106

3.2 Years

Top 5 most loss (absolute)

Company

Return %

Average Holding Period

Opto Circuits

-10

2 months

Ess Dee Aluminium

-5

2 month

Tata Communication

-24

12 months

Mangalam Cement

-16

3 months

Divi’s Laboratories

-7

2 months

Archive of previous portfolio reviews


Industries: Looking back and ahead

As the year 2010 coming to an end, reports on various industries appeared across the news papers. Here are the links to those reports on the sectors related to our investments.

PHARMACEUTICALS and HEALTH CARE

The pharma story: A decade of transition

The last 10 years were a crucial transition period for the Indian pharmaceutical industry. The next 10 years will be more crucial, predict industry experts. The period between 2000 and 2010 witnessed India’s top 10 drug companies growing from sales turnovers, ranging between Rs 500-Rs 800 crore, to professionally-run multinational generic companies with turnovers ranging from Rs 3,500 crore to over Rs 7,000 crore. If most of these companies earlier relied on bulk drug supplies, small exports to unregulated markets in Africa and Asia and formulation sales in the domestic market, the last 10 years saw them aggressively tapping regulated markets of the US and Europe and penetrating into newer and emerging markets. If the Indian industry had filed only three marketing applications with the US Food and Drug Administration (FDA) in 1998, that number swelled to 148 in 2009. http://www.business-standard.com/india/news/the-pharma-storydecadetransition/420227/

Pharma: Walking the tightrope between affordability, profits

It could well turn out to be a significant year for the over Rs 1-lakh-crore pharmaceutical industry, if clarity dawns on contentious issues facing the sector. Be it implementation of intellectual property laws, signing of free-trade agreements (FTAs), policy of price control on medicines or spate of mergers and acquisitions (M&A) – 2011 will have stake-holders looking to the Government for direction. It all boils down to how the Centre walks the fine line in balancing access to affordable medicines with encouraging industry to maintain healthy bottom-lines. http://www.thehindubusinessline.com/2010/12/31/stories/2010123151610300.htm

YEAR 2010: Acquisitions spurred Pharma, healthcare expansion

Looking healthier on booster dose of global alliances, the Indian pharma and healthcare sectors repeatedly hit headlines this year on account of M&As, but inbound buyouts by MNCs raised concerns over availability of low-cost drugs. Be it Sun Pharma’s victory in acquiring Israel’s Taro after a long drawn battle, or Piramal’s selling off its domestic formulations business to Abbott, or Biocon’s marketing deal with Pfizer, Indian drug makers sought strength from global play. http://www.business-standard.com/india/news/year-2010-acquisitions-spurred-pharma-healthcare-expansion/119573/on

Pharma: On a healthy wicket

The Indian pharmaceutical sector closed 2010 on a high note, what with an impressive stock market performance, driven largely by earnings growth and bettering prospects. And if the sector undercurrents are to be relied upon, good times are likely to continue this year as well. Strong demand growth in the US market, increasing generic penetration worldwide besides a robust domestic market, promise to keep the Indian drug makers in good health in 2011 too. http://www.thehindubusinessline.com/2011/01/01/stories/2011010151720200.htm

FMCG

2010 saw fastest FMCG launches, relaunches

2010 could well figure in the fast moving consumer goods (FMCG) annals as the year of product launches and relaunches. Indeed, the year saw almost every major player launching or relaunching as many as 10-30 products or their variants, either under existing brands or under altogether new brands and categories. http://www.dnaindia.com/money/report_2010-saw-fastest-fmcg-launches-relaunches_1488220

In demand: Iconic consumer brands

Good old brands are finding their way into the portfolios of some of the top FMCG companies in the country. They may be small but that hasn’t prevented them from finding their way into the product portfolios of some of the top fast moving consumer goods (FMCG) companies in the country. Iconic consumer brands are much in demand today. http://www.business-standard.com/india/news/in-demand-iconic-consumer-brands/419643/

Spate of price hikes spells good fortune for FMCG industry

FMCG players seem to be regaining their pricing power, with Hindustan Unilever taking price increases of 5-8 per cent in soaps and detergents, Dabur India hiking prices by 3-4 per cent and Britannia Industries 5-10 per cent on select brands of biscuits over the past six months. After dealing with rampant inflation, bruising competition and parsimonious consumers in 2009 and 2010, listed players in the fast-moving consumer goods (FMCG) segment can now look forward to an easier year ahead. http://www.thehindubusinessline.com/2010/12/27/stories/2010122751610100.htm

AUTOMOBILE

Car industry: Great hopes for 2011

The Indian car industry is looking forward to another promising year, even as the global car market struggles to find its feet after the economic slowdown. With car sales rising over 30 per cent in 2010, the momentum is expected to continue into 2011 on the back of new launches, rising income levels, and the continued availability of cheap finance. http://www.thehindubusinessline.com/2011/01/01/stories/2011010151810200.htm

Indian car makers likely to see slower growth in the new year

Even as global peers struggled with the after-effects of the 2008-09 economic slowdown, Indian car makers enjoyed double digit growth this year and saw their share prices outpace the benchmark market index. But as they enter 2011, they may have to get used to a new normal—slower growth and fiercer competition. http://www.livemint.com/2010/12/29214755/Indian-car-makers-likely-to-se.html?atype=tp

2000-2010: A decade of growth in the auto sector

The noughties or 2000-2010 will be remembered for the rise of Indian auto as a strong and lucrative domestic market. During this period, Indian manufacturers became bold and aggressive with global ambitions to boot in the in the second half. Read more at: http://profit.ndtv.com/news/show/2000-2010-a-decade-of-growth-in-the-auto-sector-132884?cp

INFORMATION TECHNOLOGY

Buoyant Indian IT industry rebounds but remains cautious

Recovering from global tech meltdown, the resilient Indian IT industry returned to high growth during a tumultuous 2010 but is cautiously optimistic about 2011 in view of the economic uncertainty in Europe and the US, which account for 80-85 per cent of its export revenue from software services and back office operations. http://economictimes.indiatimes.com/tech/ites/buoyant-indian-it-industry-rebounds-but-remains-cautious/articleshow/7190235.cms

Mid-size IT companies set to join the party in 2011

The demand for IT services remains strong due to better offshoring sentiment and increased spending by clients . A revival in discretionary projects, together with stable pricing, is likely to continue in the New Year as well. But experts caution that demand visibility has narrowed to only three-six months, given the uncertain economic scenario. http://economictimes.indiatimes.com/markets/analysis/it-mid-size-cos-set-to-join-the-party-in-2011/articleshow/7181987.cms

Infotech looks ahead to high growth, innovation

It’s been a happy 2010 for the tech industry. It ushered in glimpses of recovery, while the second half of the year brought in growth, hiring and resilience , pumping in a sense of confidence back to the markets which were shattered by the global economic meltdown. The highlight was the revival and the resilience it showed. IT companies posted good numbers clearly signalling that the risk of a double dip recession emerging and disrupting growth are now behind us. Besides, hiring plans and increments were back on board, demonstrating the feel good in the sector. So while 2010 was characterized by restructuring , consolidation, pragmatic learning and smart budgeting , 2011 will continue to build on that and move ahead, say industry experts. Read more: http://timesofindia.indiatimes.com/business/india-business/Infotech-looks-ahead-to-high-growth-innovation/articleshow/7170339.cms#ixzz19o9GYqMJ

CEMENT

Cement industry will be weighed down by excess supply

2011 could be a challenging year for cement manufacturers. Though demand for cement will reach higher double-digit growth, it will be insufficient to absorb the entire supply. Rising input prices and excess capacity (and resultant pricing pressures) will continue to depress margins for cement manufacturers. A higher growth in despatches (versus 7 per cent growth this year) will follow good housing demand and the Government’s thrust on infrastructure projects as the eleventh Five Year Plan comes to an end. With GDP growth estimates for 2011 coming at around 8.8 per cent, the cement industry can be expected to report a 10-11 per cent growth in consumption. http://www.thehindubusinessline.com/2010/12/30/stories/2010123052220200.htm

POWER

Power companies seen strengthening foundations for big plans in 2010

From disinvestment to cementing nuclear energy pacts, 2010 saw India’s power sector strengthen its foundations for the massive capacity expansion required to meet the growing needs of the energy-starved nation. The year also saw a shift in the process for awarding power projects to a tariff-based bidding system. These developments augur well for the sector, as India — which is eyeing a GDP growth rate in excess of 9 per cent — aims to add 1,00,000 MW of electricity during the XII Five-Year Plan (2012-17), with the major contribution expected to come from private power producers. http://economictimes.indiatimes.com/news/news-by-industry/energy/power/power-companies-seen-strengthening-foundations-for-big-plans-in-2010/articleshow/7189053.cms

MINING

Hunt for overseas coal assets to intensify

With the Indian economy back on the track after the slowdown, merger and acquisition (M&A) activities in the resource sector are likely to pick up momentum in the coming year. After establishing a foothold in the global oil and gas asset market, India now eyes coal assets. Meanwhile, the Indian government has proposed key changes in the existing mines and minerals development act (MMDR to allow trading of exploration and mining concessions to attract foreign investors. If the these legislative changes are approved, Indian mining sector, especially coal, might see a flurry of M&A activities. http://news.in.msn.com/business/article.aspx?cp-documentid=4742358