One stock investment can change your financial destiny.
But, how to find that one stock?
Here is a framework to find that one stock
A thread 🧵
#nifty50 #StockMarketindia #StockMarket
But, how to find that one stock?
Here is a framework to find that one stock
A thread 🧵
#nifty50 #StockMarketindia #StockMarket
1. The framework
In this framework, we will discuss:
1. Moat
2. Sales and profit growth
3. Cash flow
4. Market Cap
5. RoCE
6. Promoter Holding
7. Technical Analysis
8. Management
9. Mindset
In this framework, we will discuss:
1. Moat
2. Sales and profit growth
3. Cash flow
4. Market Cap
5. RoCE
6. Promoter Holding
7. Technical Analysis
8. Management
9. Mindset
2. Moat
A moat is a competitive advantage - it helps a stock to perform well even in the bad phase of the market.
If a company has a monopoly then that is an added advantage.
Example :Tata elxsi focussed high growth sectors like AI, EVs and semiconductors.
A moat is a competitive advantage - it helps a stock to perform well even in the bad phase of the market.
If a company has a monopoly then that is an added advantage.
Example :Tata elxsi focussed high growth sectors like AI, EVs and semiconductors.
3. Sales and profit growth
Good sales and profit CAGR - company’s products or services have acceptance.
Stock has good chances of continuing its growth .
Last three year’s sales and profit CAGR should be tracked to know growth
Example : TataElxsi
Good sales and profit CAGR - company’s products or services have acceptance.
Stock has good chances of continuing its growth .
Last three year’s sales and profit CAGR should be tracked to know growth
Example : TataElxsi
4. Cash flows
A consistent increase in cash means the company hai more legroom for CapEx
Companies can use this financial bandwidth to
position themselves better in the market and provide
them cushion against shocks.
Example : TataElxsi
A consistent increase in cash means the company hai more legroom for CapEx
Companies can use this financial bandwidth to
position themselves better in the market and provide
them cushion against shocks.
Example : TataElxsi
5. Market Cap
Less market cap - higher chance of becoming a mulibagger.
Try to find a company below 6000 Cr of market cap before they get noticed by the institutions.
Tata Elxsi in 2012 was a 600 Cr company and now it’s over 50,000 Cr.
Less market cap - higher chance of becoming a mulibagger.
Try to find a company below 6000 Cr of market cap before they get noticed by the institutions.
Tata Elxsi in 2012 was a 600 Cr company and now it’s over 50,000 Cr.
6. RoCE
It is a financial metric that tells how efficiently a company uses its capital.
RoCE above 20 is considered good.
Past 3 years’ RoCE should be tracked for finding a multi-bagger.
Example: Tata Elxsi maintained a very healthy RoCE.
It is a financial metric that tells how efficiently a company uses its capital.
RoCE above 20 is considered good.
Past 3 years’ RoCE should be tracked for finding a multi-bagger.
Example: Tata Elxsi maintained a very healthy RoCE.
7. Promoters’ Holding
Good promoter holding indicates the confidence of the promoters in the business.
Tata Elxsi has maintained a shareholding of about 44% since 2012
Good promoter holding indicates the confidence of the promoters in the business.
Tata Elxsi has maintained a shareholding of about 44% since 2012
8. Does TA matter ?
TA is good for timing the market but a multibagger can only be found using Fundamental analysis.
Lets see how a TA and FA would have entered TataElxsi
TA Entry - 300/2000 levels after breakout ( 30X /5X return)
FA entry - 100 ( 100 X return )
TA is good for timing the market but a multibagger can only be found using Fundamental analysis.
Lets see how a TA and FA would have entered TataElxsi
TA Entry - 300/2000 levels after breakout ( 30X /5X return)
FA entry - 100 ( 100 X return )
9. Management
Management matters a lot.
A good management can take an average company to the top
But a bad management will take a good company nowhere
Management matters a lot.
A good management can take an average company to the top
But a bad management will take a good company nowhere
10. Mindset
Most essential thing to get 10X / 100X return
Patience.
It needs no explanation.
Most essential thing to get 10X / 100X return
Patience.
It needs no explanation.
11. A video that explains above thing nicely
youtu.be
youtu.be
12. Tired of high brokerage on equity intraday
asthatrade.com
asthatrade.com
Loading suggestions...