The Quarter ended – Oct, Nov and Dec 2011 will perhaps see the worst results. This is because this is the Q that will see the full impact of high interest rates, the worst economic data (cause and effect are very difficult to know), bad mood, …etc.

When these results are announced, people’s worst expectation WOULD BE OVER – so the market will start moving UP, not DOWN.

This is not a guess or wishful thinking, nor am I saying this is etched in stone! There are a few shares that I have short listed to buy – and my target is an ambitious 12-14% p.a. over the next 5 years. Which means the share bought for X today should be 2X in 5 years – or 6 years, and assume say 2-3%p.a. yield of dividends. I just bought some shares in the past 2-3 days (these shares are already in my portfolio, so it is not really any fresh investing, at least intellectually!).

2 of these shares flared up a little ahead of the results – Cholamandalam and Cummins – and the returns already got in a week is stunning – but that was sheer luck.

I think instead of concentrating on the index, if you keep looking at battered sectors, good looking companies, neglected sectors, etc. there are some good deals there in the market. Keep you head on your shoulder, expectations low, do good quality research – even the basics – and then you could find them. However if you do not wish to do the ‘effort’ part, just put your money with a good fund manager (to whom the CEO listens!!) and bet on the country’s future!

Too lazy to do that also? There is always an index fund!!

Remember in 2011, the Index beat Warren Buffet also.

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  1. Subraji, Please give some insights on some of the stocks you have shortlisted and why is it attractive?. I know very well that you don’t give tips here, just a wishlist of mine (and probably some more followers) :).

  2. Agreed that Q3 FY12 results is going to be the worst quarter for this fiscal. However 2X in 5 years is an extremely safe side assumption. Today several stocks are at a kind of level that they can hit 2X in merely 15-18 months or if we do get a bull market in anytime in next 24 months, they could go more than 3 times. And I’m talking about even the good quality names rather small cap picks, specially private banks.

    PS – Found your blog through twitter, been following you as I’ve been blogging in the same field.

  3. i bought Cholamandalam Investments, Cummins and Coromandel International about 10-12 days back, and have had a fantastic (super lucky) run…can assure you it is just a coincidence of luck.

  4. Thank you for sharing Subra sir. We (atleast I) look for some some inputs from experts like you to research on some good companies. Otherwise, I am most of the time clueless on what to look for. By providing some names, you have guided me to do research on these. Thank you for sharing again.

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