DistrictD

  FILTER THE NOISE AND REANALYZE YOUR PORTFOLIO



Udit Garg

Published on 26/09/2018 12:00 AM

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Seeing the massive drop in markets over the past few days, I wondered if this situation presented any opportunities. While India story remains still strong for me, Investing has been tough over the past couple of years, simply because I feel that valuations are irrationally high, which has forced analysts to justify unduly high earnings expectations. Hence a correction like this presents a good opportunity to revisit the stocks.

So I fired up my DistrictD account and looked up models on my portfolio companies. I adjusted the business drivers to reflect any changes to the recent developments. Checked if the quarterly performance was in any way different from my full year expectations. Did my fair valuations and even did DCFs for some. I avoided companies where Fuel Costs or Cost of Funds is important part of cost structure. Did a simple exercise where you detach yourself from all the market hullaballoo and just see how the core business is doing and what is the fair value for it under reasonable and achievable expectations.

At the end of this simple exercise, I built a screen with my upsides and valuations that gave me insights into which stocks to hold onto, which ones could be sold off for better opportunities, or where there were irrational moves which I do not necessarily agree with. Overall, it helped me de-clutter my mind and focus on certain key stocks withing my portfolio in these uncertain times.

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