Restoring Traders/Investors Faith into Investing

[siddhu92]

Please solve my problem.
I bought 1241 shares of Aarya global shares and securities ltd @75.85
It has a record date of issue of bonus share 4:3 (for every 4 share 3 bonus)
Today it's stock price was adjusted by BSE to 36 and today is the ex-date (have no idea what it is)
Now in my bank portfolio it shows around 50% loss

CAN YOU PLEASE HELP ME UNDERSTAND WHAT IS THIS ALL ABOUT AND HOW WILL IT GIVE ME PROFIT ? GENUINE REPLY PLZ ITS A LOT OF MONEY FOR ME.

 

[roketsingh]

Please solve my problem.
I bought 1241 shares of Aarya global shares and securities ltd @75.85
It has a record date of issue of bonus share 4:3 (for every 4 share 3 bonus)
Today it's stock price was adjusted by BSE to 36 and today is the ex-date (have no idea what it is)
Now in my bank portfolio it shows around 50% loss

CAN YOU PLEASE HELP ME UNDERSTAND WHAT IS THIS ALL ABOUT AND HOW WILL IT GIVE ME PROFIT ? GENUINE REPLY PLZ ITS A LOT OF MONEY FOR ME.

Your total investment = 1241*75.85 = 94,129.85

After ex-date your number of shares would be = 4/3*1241 = 1654.66 ~1654

Stock is currently at 32 so your investment has become =1654*32 = 52,928

Or 43.77% loss

Companies announce bonus share when they try to increase liquidity, ex-date is the date after which new pattern would be in effect. In your case assume that earlier 300 shares were in circulation so after ex-date total number of shares would become 400.

From valuation point it does not change anything.

Things that you can do now:

1. Get hold of the person who recommended you this stock
2. Pray to God that this turns out to be a blockbuster (You should have given it a thought before you bought it, as company has mcap of 40 crores, with .2 cr in net income on sales of 0.85 crore for Qtr Dec'14(Source: Moneycontrol)

Hope it helps

 

[Mr.G]

Please solve my problem.
I bought 1241 shares of Aarya global shares and securities ltd @75.85
It has a record date of issue of bonus share 4:3 (for every 4 share 3 bonus)
Today it's stock price was adjusted by BSE to 36 and today is the ex-date (have no idea what it is)
Now in my bank portfolio it shows around 50% loss

CAN YOU PLEASE HELP ME UNDERSTAND WHAT IS THIS ALL ABOUT AND HOW WILL IT GIVE ME PROFIT ? GENUINE REPLY PLZ ITS A LOT OF MONEY FOR ME.

You bought this at more than 60P/E and more than twice its book value.

Bro prepare for a roller-coaster ride. The recent split has put this stock in focus. I suggest you do this to the guy that made you buy this stock.

 

[Prataap_2013]

Now in my bank portfolio it shows around 50% loss

Which bank?

In HDFC securities also they don't show bonus shares or stock splits in the portfolio section.

I had 70 JK Tyre before the stock split. They became 350 and the price was adjusted. Before the result it corrected and I bought 100 shares. Now my portfolio section shows 170 JK Tyre and loss :lol:.

But when I go to the "Demat Balance" section it shows the correct amount: 450 JK Tyre shares.

 

[dinesh_151]

Dear Friends... I am doing an analysis on S.a.k.t.h.i Finance Ltd. (Small Cap). ..It is an assignment from my collage. I see company has a good management and businesss is growing. Eps too growing at around 3% constantly. Everything looks positive but can not understand it's cash flow. Sometimes it is negative and sometimes positive. Could you please provide your views on company overall including cash flow. I have to work on discounted cash flow also to arrive at intrinsic value. But these negative cash flow sometimes making it difficult

Regards,
Dinesh

 

[roketsingh]

Dear Friends... I am doing an analysis on S.a.k.t.h.i Finance Ltd. (Small Cap). ..It is an assignment from my collage. I see company has a good management and businesss is growing. Eps too growing at around 3% constantly. Everything looks positive but can not understand it's cash flow. Sometimes it is negative and sometimes positive. Could you please provide your views on company overall including cash flow. I have to work on discounted cash flow also to arrive at intrinsic value. But these negative cash flow sometimes making it difficult

Regards,
Dinesh

Shouldn't you be using residual income model?

It is a financing firm so you should treat this as a banking firm. I am pretty sure using DCF for a banking stock is just wrong.

Residual Income model focuses on what is left over i.e. net of interest. Of course you can throw in a few buzz words such as NPA etc. Since you are in college you I wouldn't go into the details.

For valuation use RI model and try focusing on porter's five forces as it can provide you nice framework for company analysis.

 

[dinesh_151]

Shouldn't you be using residual income model?

It is a financing firm so you should treat this as a banking firm. I am pretty sure using DCF for a banking stock is just wrong.

Residual Income model focuses on what is left over i.e. net of interest. Of course you can throw in a few buzz words such as NPA etc. Since you are in college you I wouldn't go into the details.

For valuation use RI model and try focusing on porter's five forces as it can provide you nice framework for company analysis.

Thanks you very much for the guidance

 

[rahuld2976]

Einstein ,

one request to you..

please post portfolio for 2015..

 

[Mr.G]

Einstein ,

one request to you..

please post portfolio for 2015..

Sorry Bro, We are not posting any portfolio this time, it beats the purpose of this thread and promotes piggy backing.

 

[Sunnyraj]

Hello seniors, i have a question regarding the amount to be invested in a particular stock when you pick it for long term.

I've read that 5% of the total capital should be invested and like that form a portfolio of 10-20 stocks. This will also provide diversification.

Any views on this?