These top holdings of Madhu Kela outperformed BSE Sensex in the first half of 2021.

These top holdings of Madhu Kela outperformed BSE Sensex in the first half of 2021.
by 5paisa Research Team 07/10/2021

While BSE Sensex was 10% up till June 2021 quarter, the portfolio of stocks held by Madusudhan Kela outperformed Sensex with an astronomical return of 124% from one IT company.

2021 Outperformers till June quarter:

  • Madhu Kela had a stake of 5.58% in this micro-cap company IRIS business service on Jun 30, 2021, worth Rs 11.5 crore. The stock has surged from Rs 38 to Rs 86 in a very short time. In six months the stock registered a return of 124%. 

  • The second outperformer is Radico Khaitan Limited, he had a stake below 1% in this mid-cap liquor company. The stock has surged from Rs 456 to Rs 780 in the first half of 2021. In six months it registered a return of 70%.

  • Third outperformer is SMS Pharmaceuticals Ltd. Madhu Kela had a stake of 1.10% in this mico cap pharma company worth Rs 14.3 crore. The stock has surged from Rs 118 to Rs 180 and registered a return of 45% in a similar time horizon.

Investment strategy of Madhu Kela

Theme Identification:

Identify big growth themes and special situations for both tactical and long-term investments.  

Bottom-up Construct:

Within the identified theme, they filter out companies with better risk-adjusted return characteristics. They use a combination of proprietary sector models, earnings/balance sheet analysis tools, risk assessment frameworks to further narrow the field for investment.  

Quality of Management:

This forms the bedrock of their investing philosophy. They look out for entrepreneurs with passion and a hunger to win. The individual must demonstrate both vision and execution capabilities.

Quality of Business:

There should be a runway for sustainable growth, capital allocation decisions, investment into IP, comparison of key operating metrics against industry benchmarks, scalability potential and right to win incremental market share/business etc, are some of the points they look out for.

These are some of the steps behind Madhu Kela's stock screening process. They are size agnostic and generally prefer concentrated, medium-term bets (2-4 years).

Madhusudan Kela (Madhu), the founder of Invexa Capital, is one of the most eminent and seasoned investors in the Indian Capital Markets. In a long and highly successful career spanning three decades, Madhu has received several prestigious accolades for his investing acumen - including the Best Equity Fund Manager from the Prime Minister of India.

When you pick a stock do you prefer using any of Madhu Kela's strategies?

Next Article

What does the relative price strength predict about HDFC Bank share price?.

What does the relative price strength predict about HDFC Bank share price?.
by 5paisa Research Team 07/10/2021

Last five-year data shows that once this ratio starts increasing, it can go as high as two standard deviations above its average before reverting back towards its five-year average.

Most technical analysts employ various types of screening methods to identify the winners. One of the most widely used is a concept called relative strength to judge which securities have the promise. Relative price strength is a reliable concept and has been widely used to find the strength of stocks. One of the most common means of establishing relative strength is called the ratio method. It is merely the ratio between stocks and their index.

It has been witnessed that this ratio of well-established companies keeps on moving around the average. Divergence analysis, trend lines, and even patterns appear in the ratio lines. For example, in the last five years, the average ratio for HDFC Bank has been around 0.0942. A rising ratio shows the strength of the stock. The ratio of HDFC Bank to Nifty 50 after reaching a high of 0.11 on November 10, 2020, saw a steady decline. It reached its recent minimum of 0.085 in September. Now again it is showing a consistent gain and now it is at 0.091, which is below its five year average of 0.0942.

Last five year data shows that once this ratio starts increasing, it can go as high as two standard deviations above its average before reverting towards its five-year average.

Besides, there are fundamental reasons that can help the bank to continue its momentum. For example, on October 6, Moody's has affirmed the long-term local and foreign currency deposit ratings of HDFC Bank, at Baa3. At the same time, their rating outlooks have been changed to stable from negative. The bank also plans to unlock value through the listing of its non-banking subsidiary, HDB Financial Services. The bank is eying a valuation of anywhere between Rs 60,000-67,500 crore in which Bank holds more than 90%.

Next Article

These stocks see huge volume burst in the last leg of the trading session.

These stocks see huge volume burst in the last leg of the trading session!
by 5paisa Research Team 07/10/2021

MCX, Kalyan Jewellers, Blue Dart has witnessed volume burst in the last 75-minutes of trade.

As the saying goes, the first and the last hour of each trading session is the most important and active in terms of price and volume. More so, the activity in the last hour is said to be of utmost importance because most of the pro traders and institutions are active at this time. Hence, when a stock sees a good spike in volume in the last leg of trade along with price rise it is said to be the pro and institutions have a keen interest in the stock. Market participants should keep a close watch on these stocks as they can witness good momentum in the short-medium term. 

So, based on this principle we have shortlisted three stocks, which have witnessed volume burst in the last leg of trade along with price rise.  

Multi Commodity Exchange of India (MCX): The stock of MCX jumped over 8% and it has closed at a fresh 52-week high on Thursday. The most striking fact is that the stock has witnessed a majority of the volume activity in the last 75-minutes of the trading session. Total traded volume for the session was nearly 22.53 lakh and 70% of the volume activity was seen in the last 75-minutes of trading. Furthermore, the price too witnessed a sharp spike in the last 75-minutes, which indicates that there was a lot of interest seen in the stock. Hence, market participants can keep a close on this stock.

Kalyan Jewellers India: The stock had gained nearly 14% on Thursday and interestingly, one-third of the volume for the day was recorded in the last 75-minutes of the trading session. Plus, the price of the stock also shot up and closed near its day’s high. Keep a watch on this stock.

Blue Dart: The stock moved in a lacklustre manner for the majority part of the trading session on Thursday. However, in the last leg of the trade, the stock had witnessed buying interest. This is quite evident from the fact that nearly 70% of the volume of the day was registered in the last 75-minutes of the trade. Along with this, the price also surged higher, which suggest that the stock could remain in action in the coming trading session. Don’t miss out on this stock.

Next Article

These stocks are likely to be in focus on October 8.

These stocks are likely to be in focus on October 8.
by 5paisa Research Team 07/10/2021

Indian equity benchmarks traded on neutral lines on Thursday. Both Sensex and Nifty held the gains from the start of the trading session. Sensex ended 482.20 points or 0.82% higher and Nifty gained 142.10 points or 0.82%.

In the broader market, the BSE midcap and smallcap indices settled in green with gains of 1.68% and 1.38%, respectively. The domestic sentiments were dampened by the negative cues from other Asian markets.

On the sectoral front, all the indices ended on the higher side except BSE Telecom and BSE Oil & Gas. BSE Realty, BSE Consumer Durables and BSE Auto have rallied up to 6.03%.

Keep a watch on these stocks on Friday:

Infosys- The company announced its partnership with ATP Tour to launch a suite of exciting match stats and analysis tools designed to bring fans, coaches and media closer to the action of men’s professional tennis. The new features launched today have been enabled using the Infosys Tennis Platform which leverages tech such as big data analytics and natural language generation (NLG) to produce match insights in 3D.

Piramal Enterprises – The stock has made a fresh 52-week high price of Rs 3014.95 in Thursday’s trading session. The board of directors of Piramal Enterprises at their meeting held on October 7, 2021, approved the demerger of pharma operations. Piramal Pharma will be listed on BSE and NSE. For one share held in the company, four shares of Piramal Pharma will be issued.

Mahindra & Mahindra - The company shared that on Thursday, Mahindra XUV700 clocked 25,000 bookings in 57 minutes of its commencement which is an unprecedented milestone in the Indian automotive industry. The volume of 25,000 XUV700s made available today at the launch prices reflects up to six months of production depending on the variant. With this, XUV700 qualifies to be the first four-wheeler in India to hit this milestone.

52-week high stocks – Sensex rallied up to 500 points in Thursday’s trading session. Among the index, stocks of Oil & Natural Gas Corporation and Titan made new 52-week high prices.

Next Article

Small-cap stocks: Keep a close eye on these trending stocks on October 8, 2021.

Small-cap stocks: Keep a close eye on these trending stocks on October 8, 2021.
by 5paisa Research Team 07/10/2021

The following small-cap stocks have made fresh 52-week high today – Lemon Tree Hotels, Vascon Engineers, Shanti Overseas (India), VIP Industries, Dollar Industries and Trent.

Markets ended in the green territory on Thursday on the back of positive global cues. Nifty 50 and Sensex gained 144.35 points and 488.10 points to end at 17,790.3 and 59,677.8 respectively. Nifty Bank climbed 0.62% to end at 37,753.2. BSE Mid-cap and Small-cap indices relatively outperformed broader markets and rose by 1.68% and 1.38% respectively.

Keep a close eye on these trending small-cap stocks for Friday, October 8, 2021:

Sobha – The company has announced that it has achieved the best sales volume at sustainable price realization, primarily driven by good sale numbers achieved in Bengaluru, Gurugram, Pune and GIFT city. The Kerala region has shown improved sales performance as compared to Q1FY22. Quarterly sales volume stood at 1,348,864 square feet of super built-up area valued at Rs 10.30 billion. During the quarter, the company has also launched 'Sobha Manhattan' residential project in Bengaluru and 'Sobha Arbor' residential project in Chennai with a super built-up area of 875,242 square feet and 286,689 square feet respectively.

The company has said in a filing with the exchange that, “Sobha with its presence in 10 cities, poised to enter in new locations and with a good launch pipeline is ready to play its due role in this environment. It is also expected that a continuous increase in vaccination will make the possibility of Covid third-wave less impactful. The recent India rating outlook upgrade from negative to stable by Moody reflects the same.”

Kalyan Jewellers – The company has announced that it has witnessed revenue growth of approximately 60% from their India operations during the quarter ended September 30, 2021, as compared to the same period in the previous year. Non-south markets recorded a higher same-store sales growth close to 70% compared to south markets which recorded same-store sales growth of 40%. The company’s overall same-store sales growth in India during the quarter stood at approximately 50%.

52-week High Stocks - The following small-cap stocks have made fresh 52-week high today – Lemon Tree Hotels, Vascon Engineers, Shanti Overseas (India), VIP Industries, Dollar Industries and Trent. Keep a close eye on these counters on Friday, October 8, 2021.

Next Article

Top swing trading ideas you should not miss.

Top swing trading ideas you should not miss!
by 5paisa Research Team 07/10/2021

Best Swing Trading ideas based on price and volume percentage surge. Minda Industries, Escorts, Pidilite Industries.

Price and volume are two of the most prominent inputs used by traders across the world while swing trading. When used in isolation, they reveal very little but when used in conjunction, they help us to sort the wheat from the chaff. So, this swing trading system is based on the deadly combination of price and volume percentage surge, which helps us to discover high probability swing-trading candidates.

So, here is the list of stocks that fulfil the criteria of volume and price surge and as a result, they flash in our swing-trading system:

  1. Minda Industries: The stock jumped over 5% on Thursday. The stock’s daily range was twice its 10-day average range. In addition to this, the volume for the day was greater than its previous trading session and in fact, was the highest since September 17. Furthermore, it was greater than 10 and 30-day average volume. As a result, the stock met the norms of the swing trading system. In the near term, the stock has the potential to touch levels of Rs 810, while on the downside the support is seen around levels of Rs 743.

  1. Escorts: The stock has formed a bullish candle on Thursday as it surged over 4% on Thursday. The stocks' daily range on Thursday was greater than its 10-day average range. Additionally, the volume for the day was greater than its previous trading session and it was the highest since September 30. With price and volume criteria met, this stock looks ripe for a decent up-move from current levels in the coming days, hence, swing traders can keep this on the radar for up-move towards the level of Rs 1571, while immediate support is seen around Rs 1470.

  1. Pidilite Industries: The stock had gained over 2% on Thursday. Interestingly, the stock has met the criteria of volume and price surge on Thursday. The volumes were higher than its previous trading session and it was higher than 10 and 30-days average volume. In addition to this, the daily range of the stock was greater than its 10-day average range. Considering the strong price movement witnessed in the stock along with volume uptick, Swing traders should not miss this stock as it can touch levels of Rs 2525 in the near term followed by Rs 2565 in the medium term. On the downside, support is seen around Rs 2400 levels.