Why i am Buying this Smallcap Multibagger Gem

hello everyone hope you're all doing great welcome back to another video in this video we are going to discuss about a fundamentally strong company which has multibagger potential returns into the next 3 to 5 years when I say fundamentally strong company don't think about c r r where she will say fundamentally strong company and then the stock goes down by 20% I have done the research I've invested myself I'm going to show you my investments and give you all the facts step by step and then you can decide for yourself whether to invest or Not by God's grace I have made enough in the market what you see is my 2.25 CR portfolio all of this I have built from the scratch in the last 6 years even though I have 15 years of experience I started um I had to sell everything in 2017 and then I restarted in 2018 what you see is been built in the last 6 years so I don't have to cheat anyone I don't have to take money from anyone to promote anything I have started this YouTube channel to give free educ ation to the community so that everyone gets past the line and everyone is financially independent with that being said if you're new to this channel my name is Manoj and you're watching Trend following don't forget to subscribe to the channel and like the video I went through all the 100 pages of the annual report taken the most important points and I'm going to present to you step by step which I felt that as a subscriber it is important for you to know so spend the time watch the video from end to end this will definitely make sure you will learn something out of this video the name of the company is mastera limited all right do I have it do I own the stock yes I do how many stocks I own in this account I have about four accounts in this account I have about 232 shares in total how much is my holding I have uh 600 shares I think yes I have 600 shares at an average price of 1,560 after I bought Company stock price has gone down that is fine I'm willing to buy more now I'm going to show you the step by step fundamental analysis about the company so stick around my first criteria in my multibagger portfolio this is my multibagger portfolio if you look at this most of it is like small companies that have high potential to grow the first criteria before putting any company into this account is the size of the company I don't want to buy big companies that have the potential to grow less if you look at the market cap the company's market cap is only 600 that is my first criteria it went through now the next criteria is is the stock trending is the stock making higher high is a stock is a compounder right if I want to own a stock I want to own for period of 3 to 5 years where it will make 10x and then I can sell it I check if it is a compounder if you look at the chart pattern it is a compounder in The Last 5 Years the company has compounded time after time from 350 in 2019 to 1,500 it has compounded at about 30 to 35% all right so it is a compounder which means that into the next 5 to 8 years maybe 10 years it can still compound at 30% making 10x returns so right now my investment of 8 lakhs in the next 10 years if this company makes 10x that is going to become 1 CR all right so that is my first criteria is the company small enough and if the company is trending now the next thing that I looked into is the sector that the company is situated in it is into industrial manufacturing remember there is going to be two sectors that will perform really well into the next decade one is the broking sector where you will see a lot of hat from mutual fund say here to influencers from influencers to fake influencers who is like selling you courses that should be you are like click away to read all these materials in the internet rather than that people are selling courses for like 50,000 1 lakh rupees which is like worth literally nothing all right so that is the first sector broking sector the next sector that will perform really well is the industrial manufacturing because slowly the China's importance into manufacturing is becoming less and less as people are like waging Wars ego Wars between us and China and slowly this manufacturing Market is coming into India So eventually in the next 10 years industrial engineering will do definitely well and this company is into industrial engineering which is why the next filter also went through it is small enough the company is trending the company is compounding so I don't have to worry about my Capital put into this company and next the sector is very lucrative all right so these are the few important points I checked before investing into this company okay now what we are looking is the company's website I'll leave the link in the description if you want to go and check that out these are all the different types of Industrial Products that the company actually is making vacuum division a operator division Chiller division heat transfer Division and Air Pollution Control they make filters to transfer heat to transfer evaporators to transfer vacuum into industrial applications if you look at the clients I looked at the clients they had Simmons vanta I'm not sure the website is not showing up but if you go and click this you will see vidanta seens and then there are several other steel manufacturing Industries to where the company is scattering into the only thing that is bit off for me is the food division generally a company that is into pure manufacturing I don't know how they will actually um cope up with the food business but we will see as the time goes by how they are actually growing this food side of the business all right for now they're making jams and juices and it is growing a bit slower than the manufacturing division for now we'll have to give it some time to see how this food business is actually growing it is too early to decide and uh put the food business under the bus okay now what we are seeing at the back is the annual report and at the foreground is the screener all right so this is the total revenue that the company has made for 2022 2023 and uh blah blah blah blah total comprehensive income for the year is 26 CR 70 lakhs look at this Surplus brought forward this is nothing but the retained profits that the company has made in the past years they are building this what is this component this component is nothing but the reserves in the balance sheet okay since we are talking about 2022 to 2023 this is the number they are saying on this number what they have done they have added all the profits of this year's profit 26 CR 7 lakhs to this number and this is the number that they have arrived at so next year the company starts at 1 182 cror so if you add both of this 18 186 cr70 lakh the remaining 4 CR they have spent it as dividends if you look at a company that has compounded 20 25% over a period of 20 years 30 years 40 years you will see this retained profits which is nothing but the reserves in the balance sheet go up at least 15% 18% 20% Time After Time After Time what the management does they make the profits and then they put the profits back into the balance sheet of the company so any funds that the company want they they can use it from this money without any further debt you see that the borrowing they have is almost literally zero the latest number which means the company is debt free all the money that they are using to expand the business is coming from the internal accural which is nothing but the profits that was made during the early years so the money that they are making the profits they're putting back into the business to grow the business further this is the these are the kind of companies that you should be investing for a long period of time right the other one right that that I wanted to explain is the balance sheet if you look at the balance sheet just uh maximize this this is the area of company oing left side of the balance sheet company owes on the right side company owns when I say company owes it has to give it to someone okay this is not the company's money who is that someone equity share Capital this shareholder funds retained profits and this is the liabilities company has borrowed some money from someone if you take the trade payables company has taken the raw materials to do something they have not paid the actual creditor that is what the trade payables are and then there is other liability items maybe they could have borrowed some money from someone I don't know I have to check the latest annual report but it stands at 25 crores So eventually if you see company don't have any debt most of the money that they are using to grow is coming from the retain profits this is the liability section of the balance sheet now the asset section what do they actually own fixed assets 76 CR last year the land value was 11 cr50 lakhs it was the same for the last few years look at this building building was 17 cr50 lakhs last year now it has grown to 47 lakhs this means they have constructed new buildings for addition of something maybe uh expansion putting up new machinaries or whatever putting up new Workforce or whatever see the plant Machinery last year it was 14 cr50 lakhs now there is a 9 cror extra this is called as capital expenditure capex they have put in more machinaries to produce more so if you add all of this this will match the liability section which is like 275 one thing 235 sorry one thing that caught my eye in the balance sheet is the Investments Time After Time the company is investing into mutual funds bonds and fixed instruments and they are making some money out of this I've checked the annual report I'm going to show you company has invested 43 crores in mutual funds de funds and Equity Funds where they are making some money into the Investments if you look in short they making profits through their operations bringing it to reses and surplus retain profits use that money to invest into somewhere make more money and grow your business time after time this is where a actual multibagger will look like into the early stages all right so I'm going to go show you where they have invested 43 crores in a short while so look at this this is where they have invested 43 crores of rupees 41 crores is actually into current Investments any Investments that can be converted into cash within a year is called as current Investments so here the actual amount invested is 41 cr77 lakhs non-current Investments there is like 1.5 CR if you put both of them together the actual Investments that the company has made is 43 Crowes if you want to know further about it where they have invested and everything I'll leave this uh Link in the description you can just go and check out it is available in 68th page all right so it's up to you to go and look into it all right now the next important thing that I've noticed is in the page number 32 you will find the renumeration of the management if you look at the Management's renumeration they are not taking exuberant fees for running the company if you look at uh the actual directors all put together they are making about 4 and half crores for a company that is making 27 and it is expected to grow at 20 25% 4 crores of renumeration is okay it's still with a mean so this is also one of the important factors that I looked into before investing into the company because I don't want the management to take most of the money that actually belongs to the shareholders all right if you look at the four important numbers rocce Roe OPM and npm rooc is quite healthy 18% r e um I don't want to rule out the company just for the sake of this number number it's a bit low but at the end of the day company is still growing I want to give more time to see how they are actually improving return on equity for the shareholders OPM for every one rupee the company is selling after all the expense operating profit margin stays at 18% and then npm net profit margin for every one rupee the company is selling company is making 14 P this is also Doo good all right so if you look at everything and remember the dividend Factor also company is paying 1% dividend which is also healthy company being a small company the final important factor that I looked into the number of shareholders to see how the company's shareholding pattern behaves because remember one thing the chart pattern that the company shows is nothing but the chart pattern of these holders right however they behave the chart pattern also behaves like that so I generally look at this number before going into the investment to see how the beta and volatility will be if the beta is going to be high I invest small small CHS if the beta is going to be low I'll just put a lump some I know that if the share price Falls it is not going to fall much in case of low beta if the beta is high if the share price Falls I should have some money to actually average it at a lower price so always I look at this number to see how the beta will be there most of the Holdings is into promoter hands so I know that the that the share price will not see big volatility and there is some fi numbers also di numbers also public if you look at the number of holders in the public hands it is going up slowly which means that once in a while either brokerages are suggesting this company or some somebody based on the numbers since the company is growing some retail investors are taking positions right now the company has the highest number of retail investors invested into it into into its history so slowly it's gaining attraction among investors which also means that so 51% retail investors hold that means you can see a lot of retracements during the journey people who bought here they are going to sell here people who bought here they are going to sell here people who bought here are going to sell here since they are retail investors we cannot do anything but if you put all the factors into one place company is small company is compounding company is growing company has good clients company's trending company is literally cheap company is giving 1% dividend company has the highest number of retail shareholders gaining attraction this makes this company one of the good Investments to have in your portfolio but just remember I'm not SE registered just go through the numbers go through the facts that I have explained in this video and make a decision for yourself don't forget to subscribe to the channel I'll meet you again thanks bye-bye take care

Channel: Trend Following with Manoj

Views: 3,306

Keywords: penny stocks, best penny stocks to buy, mutual funds, multibaggers, multibagger, small cap gems, mazda ltd share, mazda ltd share news, mazda ltd share latest news, mazda ltd share analysis, smallcap gem, smallcap stocks for 2024, smallcap stocks to buy now, smallcap stocks to buy now tamil, best smallcap stock to buy now, best smallcap stocks for 2024, best stocks to buy now, best stocks smallcap to buy now, trending penny stocks in india, trending stocks, ca rachana ranade

Id: rl7iCpwpCuQ

Length: 14min 43sec (883 seconds)

Published: Sun May 19 2024