Some six months ago, I started investing through systematic investment plans (SIPs) in SBI magnum balance, ICICI infrastructure, DSP Merrill Lynch T.I.G.E.R., and Standard Chartered Premium Equity at Rs5,000 each. Should I continue or I should change my portfolio? Also, on 3 March, I invested Rs20,000 in SBI Magnum Contra online. My friends told me that the market would go down further and that I should not invest now. Should I stop this transaction? If I don’t send signed documents to the asset management company, will they refund my money? What will be the impications?
Your portfolio seems quite balanced and is likely to yield good returns in the long term. Since I do not know your risk appetite and the purpose of investment, I will not be able to comment on changes as it would largely depend on your objective of your investment vis-à-vis risk and the time frame.
As far as SBI Magnum Contra is concerned, it is a good fund and if you have a long-term objective for your investment, then you should not worry about this. Despite the stock markets still being shaky and are prone to risk of further fall, I would not recommend you to withdraw this as your choice of fund is correct.
I would like to invest Rs1 lakh in stock, which will give me a decent return in the next 4-5 years. Kindly suggest the stocks I should buy. I presently do not own any stock.
Ajay Kumar Lal
If you have a time frame of 4-5 years, then there are several good stocks. However, stocks such as Bajaj Auto Finance Ltd at Rs375, Alok Industries at Rs58, Allahabad Bank at Rs94, etc., can be considered for long-term investment.
I hold shares in Shivalik Loha (100 shares), Empee Sugars (100 shares), Escorts Finance (500 shares), Gyan Leatherboard (200 shares), JK Pharmachem (100 shares), Kanha Vanaspati (100 shares), Madras Hi-Tech (200 shares), Nuchem (200 shares) and Paam Drugs (100 shares). Please advise what to do with these shares?
Shivalik Loha Metals does not trade anymore as it was delisted on 14 January, 2004, while Empee Sugar is a typical momentum stock. You may come out of this stock around Rs16-17 in the next rally and may invest in other better options. Escorts Finance Ltd is also a non-performer and you may exit this stock around Rs17-18, in the next round of rally. Gyan Leatherboard Ltd was delisted on 20 April, 2004 and hence does not trade. JK Pahrmachem also does not trade now. Kanha Vanaspati was delisted on 20 April, 2004, while Madras Hi-tech also does not trade now. Nuchem Ltd is a volatile stock and you may sell it at around Rs32 and invest in better options. Paam Drugs Ltd was delisted on 2 July, 2004.
I hold shares in Hindustan Oil Exploration (100 shares purchased at Rs93.53 and 133 at Rs177), Shreyas Shipping (100 at Rs217.50 and 500 at Rs114), Gateway Distripark (500 at Rs207) and Varun Shipping (500 at Rs32.60 and 1,000 at Rs71). Kindly advise if these are good for the long term, or if it is better to divest in the near short term?
All the stocks you have mentioned are good, but they may take some time to offer you good returns. Since the markets are in turmoil, you may add to your portfolio to average out the cost of acquisition. In the long term, all these stocks can offer you a return better than the aggregate market. In the short term, I would advise you to hold them.
I hold 500 shares of Super Crop, 100 shares of Rajeshree Sugar, 100 shares of Atul Ltd and 100 shares of Ambalal Sarabhai Enterprises Ltd. Please advise on the above shares.
Super Corp Ltd is a range bound stock with a year high of Rs12.39 and year low of Rs5.47. You may exit this stock at around Rs15. Rajshree Sugar is one of the few sugar stocks, which have not moved much lately.
You may hold this stock for 1-2 years. Atul Ltd has fallen sharply in 2008 so far tracking general weak trend in the industry.
However at this price you may hold this stock and exit at around Rs120-125. You can also hold Ambalal Sarabhai Enterprises Ltd for now and re-evaluate the stock for exiting around Rs55.
I have bought these shares: Ceat, 15 shares at Rs175.90; Harig Crankshaft, 500 shares at Rs03.48; Isapt, 98 shares at Rs44.80; Nagarjuna Fertilizers, 52shares at Rs82; Neyveli Lignite, 50 shares at Rs161.12; Pael, 60 shares at Rs32; TTML, 100 shares at Rs41 and RPL, 40 shares at Rs162.05. I have to give someone Rs9,000. Please suggest which ones to sell. Also suggest me should I wait for some more time.
All your stocks are down from their purchase price and, ideally, this is not the time to sell. However if you have to sell any of these stocks, then you may sell Ceat Ltd and Harig Crankshaft Ltd to meet your requirements.
I am holding Nagarjuna Fertilizers purchased at Rs70 and RPG Cables purchased at Rs56. How long should I hold on to these?
Since the stock markets are currently down and near their bottom in the short term, I think it is not the right time to sell. Going by macro technical indicators, markets are showing signs of good upward momentum in the second half of this year. So, unless you have some compelling requirement, you should hold on to your stocks. Regarding your holding, my advice is the same, since both these stocks have potential and they may do well.
I am 40 years old and need to plan for my children’s education, their marriages and earning after my retirement. Please advise as to how much, and on which pattern I should start investing. I can invest about Rs1-1.5 lakh per annum for 15 years from now. How much money can I expect to get back after the 15 years? Can I target to get about Rs1 crore after 15 years? Or should I try for one lump sum amount and other monthly incomes?
The best option for you is invest through SIPs in mutual funds. Initially, keep the time frame of 2-3 years and on completion of that period, re-evaluate your investments. Since you get tax benefits on investments in mutual funds in addition to good returns, it makes sense to invest in them. Your amount of annual investment is equal to the maximum amount you can invest to claim tax, so this would be most ideal.
However, for any investment above Rs1 lakh, you may invest in good IPOs. If you stick to SIPs and consistently invest and plough back your returns, then you may reach your targets comfortably.
Answers are based on a technical analysis of the markets and individual stocks. The views expressed on this page are not the newspaper’s opinion and are provided for information purposes by Vipul Verma. Readers are requested to do their own research before participating in the stock markets. Neither the paper nor the information provider will be responsible for any outcome based on information provided here.