Our Next Recommendation... from the Superinvestor Who Buys Right and Sits Tight - The 5 Minute WrapUp by Equitymaster
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Our Next Recommendation... from the Superinvestor Who Buys Right and Sits Tight

Jul 18, 2018

Sarvajeet Bodas, Research analyst, The 5 Minute Wrapup

14 recommendations in 13 months.

Since June 2017, Kunal Thanvi and I have tracked dozens of stocks bought by India's best investors.

  • Prof Sanjay Bakshi
  • Sumeet Nagar
  • Aakash Prakash
  • Ashish Kacholia
  • Anil Kumar Goel
  • Kenneth Andrade

And we recommend stocks in the portfolios of these superinvestors to Smart Money Secrets subscribers.

But there was this one stock...

We recommended it, in November 2017, as 'buy at lower level'. It wasn't cheap enough at that time.

This stock was in the portfolio of Mr Pulak Prasad, owner of a private equity firm Nalanda Capital.

Kunal and I really like this super investor.

You can find this on Nalanda Capital's website...

  • We consider ourselves to be permanent (part) owners of high-quality publicly listed businesses run by exceptional people.

Pulak Prasad likes to buy big stakes in high-quality stocks and hold them for a long... long time. He refuses to sell his winners even after these stocks have multiplied many times.

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Rich Investors Will Hate Us For What We are About to Reveal...

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A few years ago, the authorities actually made it easier for small investors to do just that!

This regulatory decision started it all off.

Now the average investor can ride along as institutional investors make bets of hundreds of crores...

And claim returns that are just as good - if not better!

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Some examples...

Page Industries - 9.27% stake

Mindtree Ltd. - 10.62% stake

Supreme Industries - 5.94% stake

Nalanda Capital is holding these stocks for the long haul. In fact, Prasad has exited just six stocks in the last ten years!

We like the fact that he invests only in companies that are led by exceptional management and have high returns on capital.

With this framework, we've found this month's recommendation.

Pulak Prasad is holding this company in his portfolio for the past seven years.

What separates this company from others is the vast experience and track record of the management.

Although it operates in a difficult industry, the management's prudent capital allocation has differentiated this company from the competition.

That's the reason, the company has weathered many storms and emerged stronger every time.

This company has been on our radar for a long time. Finally, after the recent correction, the stock is available at an attractive price.

If you've subscribed to Smart Money Secrets, expect the detailed report by next Monday.

If you haven't signed up for Smart Money Secrets...you can get the report by signing up here.

Chart of the Day

One of the important indicators that the company is doing well is an increasing promoter stake.

Promoters raise their stake in their business usually when they find value in the stock or prepare for a positive development in the company.

We, at Smart Money Secrets, track this very closely.

This month's stock recommendation is the case in point. Apart from the presence of superinvestor - Pulak Prasad, the promoters have consistently increased their stake in the last 18 years.

Promoters Increased Their Stake by 10.5% in the Last 18 Years

We'll be publishing the detailed report by next Monday. Watch this space.

Also, remember that changes in promoter stake shouldn't be seen in isolation. Company fundamentals and valuations are equally important.


Sarvajeet Bodas
Sarvajeet Bodas
Research Analyst, Smart Money Secrets

PS: Kunal Thanvi is the Sherlock Holmes of investing. He is on a mission to reveal the top picks of India's best investors to you. For clean, high quality stocks that won't put your wealth in peril, subscribe to Kunal's Smart Money Secrets.

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