Stock Recommendation – Sejal Architect

The way Sejal has shown strength in recent time, we recommend this stock as buy for long term target of 250-350.

However, we would advise you to wait for 1-2 months before you buy it. It should come down to around 50-60. This will be best buy price for this stock to buy.

Stock Category – Growth

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Growth/Value/Junk Stocks from our recommendation

Hello Friend, we know every one wants to know what stocks belong to which category we have recommended recently.

Just to give you an idea -

Growth Stocks – HCC, ABG Shipyard, Bharati Shipyard, Welspun Gujarat, IDFC, Jaiprakash Associates, Tata Motors, Godawari Power, Nucleus Software, Himadri Chemicals, Rolta, Bilcare, HDIL etc.

Value Stocks - Suzlon, Alok Industries, Rei Agro, Rcom, Provogue, Tanla Solution, Gati, Satyam, 3i, Balaji Telefilm, Anant Raj

Junk Stocks - PVP,  Sel Man.

Now big thing here is that a value stock may become a growth stock over the period of time. While a Growth stock can also become a value stock over a period of time. Like Rcom was a Growth stock earlier but because Telecom sector was beaten in india and this stock dipped so much, its value at current market price is of a “Value Stock”

If we have to buy 10 stocks for long term, We will buy 5 growth stocks, 4 value and 1 junk. OR, 6 growth, 3 value and 1 junk. Growth stocks will help your portfolio to keep from going down too much in short period. A value stock will help you to make very good money in longer run. While a junk stock as we always say, can make you millionnaire in longer run with small amount of investment if your luck favors you.

Hope this will help you.

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Sterlite Technology – Live example

When Sterlite Technologies was quoting at around 40 last year no one wanted to buy it simply because there was no end to downside. All of a sudden it started moving up and crossed 250. Everyone analyst jumped in to recommend to buy Sterlite Tech. Everyone knows what happened to Sterlite Tech then. It touched 450 then stock split and gave bonus in March 2010.  Suppose you had bought Sterlite Tech at 40 last year for total 1000 shares (i.e. Rs 40000 investment). Now after stock split (5:2) and bonus (1:1) you total shares count would be 5000. Price after split and bonus was approx 90. That means your initial investment of Rs 40000 have now become 450000. Now suppose Sterlite touches to 500 again in next 5 yrs then your total amount would be 25 Lacs (5000*500). Oooph…6150% profit in almost 6 yrs. What else you need guys?

What does this tell?

When you buy a stock always think from long term perspective. You should have confidence and faith in yourself and you will see you succeed in stock market.  Fear and Greed will always prohibit you from succeeding in stock market.

We always say “If your luck favours you and your choice is right”, a small amount of investment can make you Millionaire in longer run.

Remember few things -

1. Stock market always fluctuate in short term. Even if you ask any stock market Guru, no one can tell you that what will happen in next moment or next day. It is only long run when your investment starts giving you good return.

2. When you buy you need to buy right and hold tight (Rakesh Jhunjhunwala tip)

3. It is always good that you pickup a stock at its bottom to reap maximum profit (otherwise you will just end up chasing a stock to buy and return may not be very high).

Hope this was useful…

Happy Investing

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How investors make money in long run….

Suppose you own 15 stocks for a 5 yrs investment period. Now what you need is 2 stocks to give you bonus (1:1) two times in 5 yrs and two stocks to split (1:1) 2 times in 5 yrs.

Essentially now those 4 stocks (out of your 15 stocks) are increasing your number of shares by 4 times in 5 yrs.

Again assume you bought all those 4 stocks at 100 Rs in beginning and your investment in all those 4 stocks was total 1 Lac. Lets say their price after 5 yrs is Rs 500. This mean your 1Lac investment in those 4 stocks has turned into Rs 20Lacs  in 5 yrs.

Coming to rest 11 stocks. Lets say you had invested 4Lacs in those 11 stocks and after 5 yrs their average return is only double. Then your total return after 5 yrs would be 28 Lacs from an intial investment of Rs 5 Lac in beginning.

This means you are getting a whopping 600% return on your investment in 5 yrs which no one except only stock market can give you.

These are just manipulation and your return can be higher or lower as well but if you are riding on your fortunes plus on our strategy of Growth, Value, junk stocks investment then you should definitely get at least 600% return in longer run. Those 4 stocks which returened you 20Lacs will be considered as multibaggers. “Dont be too greedy….you can’t have all your stocks as multibagger”.

Thats it and this is the phlosophy of all longer term investors and thats why they make huge money.

Always remember market will exhaust you completely and take full exam of your patience before giving 600% return.

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Our recent recommendation – Tata Motors

In Dec 09, we said Indian Auto Industry would flourish in coming years and Tata Motors can be highly growth stock and give you very handsome return in long run.

http://netstock.wordpress.com/2009/12/22/auto-sector-india-next-giant/

You can see the potential of Tata Motors. In just one day it has jumped for 86 points (12.10%)…wow what a one day gain for such a giant.

It is very important that you ride good growth stocks as well when playing for long term.

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