Expensive Market मैं सही Stocks कैसे Identify करे ? Strategy Revealed with Aditya Khemka

Aditya Khemka, a fund manager, talks about how to find equities in a pricey market. He clarifies that not all equities are overpriced, even though the market may be pricey overall. Khemka observes that only roughly 4500 of the 5500 listed businesses are trading at all-time highs in terms of values, using the Nifty 50 index as an example. Khemka highlights the significance of investing counter cyclically stock and figuring out which industries will drive the following cycle. In order to develop a strong investment thesis, he also talks about how crucial it is to connect the story with the data and dig beyond conventional indicators like Earnings (E) and Price to Earnings (PE) ratios when assessing equities.

Khemka talks about the investment technique of purchasing stocks of companies that have completed significant capital expenditures but have not yet monetized their investments. He also recounts his experiences of making profitable investments in Maruti and Ipka Laboratories. He also discusses the difficulties facing the pharmaceutical industry as well as the possible growth prospects in the telecom, IT, and urban discretionary sectors. Khemka stresses the value of perseverance, concentration, and studying from actual market professionals throughout the entire movie.

Aditya presents a case study of how they used a bottom-up strategy to find UPL, a winning stock. After examining the competitive environment, they discovered that, of the seven agrichemical companies, five had significant net debt to EBITDA ratios and could thus be insolvent. UPL, on the other hand, would have survived in any case because of its lower debt ratio. As investors, they would have profited regardless of whether prices rose as a result of UPL's higher margin or volume rose as a result of competitors filing for bankruptcy. They also talked about the significance of value and counter-cyclical investing, which involves purchasing underperforming companies with the possibility of future gains. They stressed the necessity of multiple re-ratings in addition to earning increases.

Aditya Khemka talks about how it's critical to assess a company's solvency risk in order to decide whether or not to buy its stocks. He says that because there is more risk involved, pricing goes up as a company gets closer to solvency. The stock could tank if the industry is dominated by a small number of companies. However, the cost will go up as more participants join in.