Investment FAQs with Parimal Ade (Investment Satsang- 12)

3 min read

Here are some questions asked by the viewers in the Investment Satsang dated 9th July 2021. These questions can provide you insights on some grounds. Please read these questions for knowledge purposes only and make any investment decisions only based on your research or the advice of your financial advisor.

Q Which will be giving good return having 10+ years horizon- Mutual Funds or PMS in Small and Mid Cap?
Parimal Ade:

• In PMS if you are not participating on a day-to-day basis then it will be dependent on the manager’s capacity.
• Otherwise in mutual funds, there needs to be discipline on the regular basis from the investment point of view.
• There should be a regular review of the investment.
• It is always better to have the portfolio in your hand or else Mutual funds are also a good place to invest in.

Q View on Clean Science and Technology IPO?
Parimal Ade:

• The chemical and Specialty Chemical Industry going to be good in the next 5 years at least.
• Till the time companies under this sector are delivering good returns there is no doubt about it.
• There is a lot of interest as a lot of applications in the IPO have come and also witnessing good response.
• From a small-cap company, it is going to be a mid-cap company at the time of listing.
• If you know about the products very well then only it good to invest.
• Currently, there is no down side seen.

Q View on Polyplex: Cyclical or growth company?
Parimal Ade:

• In the place where there are crude derivatives, there could be some negative impact for a shorter duration.
• For a longer horizon, things should be good.
• This is going to be cyclical as the crude itself is a cyclical play. Hence it will have its impact.
• Currently, demand is on the good side.

Q View on LIC Housing Finance?
Parimal Ade:

• It is a good value stock.
• The housing finance story will be there for the very long term.
• Strong parentage companies are going to do well.
• In between, there are going to be hiccups like NPAs, etc.
• Being a housing finance company it should not be a problem.
• Good for Conservative and Moderate Investors.

Q View on ITC?
Parimal Ade:

• ITC will start running when the FMCG and Agri-Business will start running well and generate double-digit operating profit margin provided every quarter the results are improving.
• Other FMCG companies are working at 25%-20% operating margins.
• This company on FMCG and Agribusiness which institutional investors are looking for a longer horizon. Till that time there is no improvement in this business it is going to test your patience.
• Until then there will be dividend play of 5%-7% in ITC Stock.

Q Views on CamlinFine?
Parimal Ade:

• This company has reached 52 weeks high after a long time of consolidation.
• It is a small-cap specialty chemicals company with Rs 2500 Cr. Market capitalization.
• The company looks interesting. Looking forward to the new plant doing well.
• The market has started doing discounting. As they have made the biggest investment for the new plant.
• Due to some regulation, there was some delay. but now it is on right track.

Q Should all investments need to be done through a HUF account to save tax?
Parimal Ade:

• The objective of investment should be there to get the returns not to save just taxes.
• Tax Saving should be a byproduct of the right investment decision.
• The investment should be simple.

Q Why is RIL is less in ROE and ROC?
Parimal Ade:

• They had made a good amount of investments into 2 big capital industries.
• One is retail industries and the other one is telecom. Now they are getting additional capital also with them.
• For some time the numbers will look disappointing.
• Need to look at the growth that they are going to give and receive profits also in those segments.

Q Need to make some investment for the mother-in-law?
Parimal Ade:

• It is suggested that it needs to keep the next 3 years’ expenses in debt-oriented securities. From there can be a monthly withdrawal.
• The rest of the money can be parked in debt-oriented hybrid funds with returns of 8%-9%.
• Should not concern about the market hiccups as well. As the liquidity is intact.
• Every year need to review this situation.

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