Stock Picking Formula

Picking gems that can turn out to be true multi-baggers:

Gems are those stories that has a long way to go because of strong order book and execution capabilities or strong business model or a hidden gem in the balance sheet that will be recognized once it nears its fair value. It is always good to pick stocks that will be the flavors of tomorrow rather than chasing stocks that has hogged limelight and once thing works out as expected a fair value on clear picture can be estimated. The return these stocks can give is tremendous, with sentiments towards equity markets not being positive such investments provide cushion to the investors.
The logic behind picking stocks:

• Pick a stock in a category that’s under-owned by financial institution: An under owned sector hogs limelight and gives good returns as financial institutions try mopping up stocks in the sector, once outlook on the sector changes. These sectors go through re-rating and gems identified in the sector can give returns that are much higher than index leaders. IT companies a classical eg in the case
• In addition to it, the stock has to be Low on valuation to its peers, preferably sectors that are beaten down in terms of scenario they are into and going forward a slight positive can result in faster re-rating of stocks.
  Principle of investment: PEG ratio<0.3>
• Price Earning (P/E) in single digit: It reflects the market price divided by EPS of the company. Companies of similar size and similar earnings, a stock with lower P/E will be preferred. However some sectors do not command high P/E, it is always good to compare stock with large players and similar peers.
• Growth potential of close to 20% CAGR: A company having visibility of 20 % y-o-y will always have some interest either by financial institution or large players. A clear cut accumulation can be seen in such stocks during market corrections.
• Other factors that needs to be considered: Large players in the range of 13-15 times forward. Strong order book and execution capabilities, management track record and uniqueness in business model and low on risk. Look for cushion in these stocks in terms of price to book value or EV to sales or other financial ratios that can justify its potential going forward.

This is just a brief guideline and one of the way of picking stocks.

Contributed by ,

SPL Investments

Another Venture from SPL Group

Have you ever thought the way Investments are done

Karm Bhumi hai teri karm karta ja placement ki kya sochta hai pagle aage badhta jaa

Manegi Duniya loha tera bas apni Soch aur samjh ko Duniya ke saath badalta jaa.....

One of the motivational force that drives SPL conquest and thats why we inspire confidence..

This is for all of them who is feeling a bit low today but don't be worried life is full of opportunities and if you miss one you have another waiting for you.So cheer up

Talking about opportunities, Lets share the thought on Investments today,

a friend of mine told its a place where people with experience and people with money meet to exchange the goods they own Money and Experience Is it the fact?

Finance students please think about it,that market today does not look at pricing alone, or even simple concepts which are of no relevance in real world like Beta or PE Ratio. The world of investment is about gaining experience and lot of solid research makes you a deadly wine that attracts profit.

A very simple equation that we as a team talk about is the concept of replacing cost of proven businesses during the tougher times. Do remember an investor is one who knows what he is doing to protect his portfolio and not the one who buys on other recommendations.

Few of the investment formula jargons that we heavily rely on are

Identifying Growth Sectors, Themes that will be winning investments, EV/EBITDA, replacement cost theory PEG ratio and many more sophisticated tools of investment technical and otherwise.

Identifying gems based on there intrinsic value which does not even involve using a DCF technique just a simple call on the valuation front and you get it

Doing lot of Value research as a team we never focus on Reliance or SBI but we do focus on small mid cap gems. This is an area where true baggers are identified lot of risk and even higher return. Want to learn more about investment write to us/follow us on our blog and do not forget to register as a follower.

Today I wanted to know how many of you are actually curious about learning new things on investments. So vote or either write to us if you want more. we will teach you the real investment market and real meaning of investment. To learn more about Investments forward your queries to splconquest@gmail.com and learn about Indian Equity Markets

Important Data

Rates %
Bank rate 6
Repo rate 4.75
Reverse Repo Rate 3.25
CRR 5
SLR 24
PLR 12.75-13.25
Savings Rate 7.5-9.6
Deposit rate 3.5
Call rate 2.25-4.3

RBI GOvernor : Mr Subba Rao
Sebi Chairman : C B bhave
Mahindra Satyam: Under Vineet Nayyar

Vice President: Mohammad Hamid Ansari
President: Smt. Pratibha Devsingh Patil
Speaker of Lok Sabha: Meira Kumar

Basic Information on HDFC bank

Along with the basic search on HDFC make sure you are updated with the following facts too:

HDFC Bank Promoted by Deepak Parekh was incorporated in the year 1994. 16 years down the line, the bank has become a mammoth. Who does not know about HDFC bank. A bank which has a track record of giving consistent growth maintaining highest net margins in the sector and still emerging as a winner during the toughest situation

HDFC is a 64000 crore market Capitalized bank which has a very steady model of growth. The strength of the business structure of HDFC extends to its unlisted companies.

Bank has never been too aggressive and that’s why it has managed the down turn so well. Think about its competitors ICICI bank a drastic fall from the peak of 2008 was almost on the verge of shut down. The bank has always received premium over its competitors because of its strategic growth. During the slowdown too, it merged Centurion Bank of Punjab with itself in 2008 as the management knew how much downside is there in the global scenario.

Do remember friends Mr. Parekh, was heading the Satyam saga to safeguard the confidence of the investor and their wealth stuck in the company.

The bank is all set for Basel Norms and would benefit the most once the sector opens up for foreign players in a large scale.

HDFC sister concerns are FII’s favorites whenever the bank index has to recover it makes the first move on the bourses.

Highest Net Interest Margin, best CASA Ratio and its subsidiaries (not exactly) but sort of a Subsidiary like HDFC securities Mutual Fund Life Insurance etc. makes it clear the bank has all the potential to grow even bigger.

Please prepare about the company on these lines I am sure that’s all you would need to know about the company.

Note:- Please note this is to provide basic information about the topic to make sure that you get an idea on the subject in the sense what lines you need t0 prepare on.

All the very best friends,
SPL Conquest

Swine Flu – Global Bedlam or Edpidemic

Do we fear volcanic eruption, do we think about global warming, and then don’t you think that this new pandemonium deserves a serious attention?

History:-

Novel H1N1 earlier referred to as Swine Flu was first detected in US in April 2009. In 2008, World Bank estimated that a flu pandemic could cost $3 trillion and would result in a nearly 5% drop in world GDP. Do you think that the World Bank were correct with the stats? Let’s see!

Facts & Figures:-

According to latest estimate of WHO, approx 816 people have died from infection. An estimated 1 in every 158 people in England is thought to have had swine flu since the outbreak began in England at the end of April. In India itself, 525 cases have been identified mostly in the state of Andhra Pradesh, Maharashtra, Manipur and Delhi and yesterday a girl in Pune died and I think everyone must be aware of the reason by now. It has the power of swiping away 12% of US GDP.

Researchers do have come up with anti virus Tamiflu but they are effective only if taken in the first 48 hours of infection but they also bear side effects like nauseau and diarrhoea.

Steps taken by the governement:-

In UK, government has started a national pandemic flu service helpline, which helps people diagnose whether they have swine flu and tells them what to do if they are ill.

Similarly, Maharashtra government has decided to boost homeopathic research on the H1N1 virus with an initial provision of Rs 5 lakh.

Even in Jordan, ministry will purchase Thermal Scanning Cameras, a device that images transmitted heat which would be placed at airport and at border crossings.

Beneficiary:-

But overall it has come as a boon for vaccines and anti-viral drug maker. (Justification: Shares of Novavax Inc touched a two-year high of $4.40, Vical Incs shares rose to a new 52-week high of $3.96 on Nasdaq, Biocryst Pharmaceuticals Incs shares rose as much as 18% to a two-year high of $11.20).

Precaution:-

If you think we are safe, I think we are mistaken because on 14th June, around 100 software professionals in Hyderabad walked into the Government Chest Hospital, the nodal centre for handling swine flu cases in the state, to get them checked for the virus, out of message spread about Swine flu. This booby hatch deserves special attention, in terms of awareness, safety precaution, initial diagnose if one is suffering from fever so that it does not spread. Your fellow citizen’ life is equally important.

Note:- Please note this is to provide basic information about the topic to make sure that you get an idea on this.

GD TOPIC for PLACEMENTS

Here's the list of Important GD Topics

Indian Film At Oscars
Realty TV Shows should be banned as its in bad taste for our Culture
Gayism in India
Delhi Metro Mishap who should be blamed
Maytas and Satyam the link to the Hyderabad-metro project
General Motors
Cash for Clunkers
Common Wealth
Tata Motors movement to Gujarat from Singur- Political financial
Google Vs Microhoo
Are social networking sites a medium to promote vulgarity
RNRL vs RIL
Tie up of ADAG with Dream Works
and Many more