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Dear Readers,

Wish to share a touching as well as pleasant history in the course of my Portfolio Advisory Services.

One of my clients, Mr Mohit Singhania (26) has compelled to sell out his entire holdings behind a superior humankind motive. I am privileged as I have such a true human being as my client or is still hard to believe, people like him are exists in this self-seeking world. He blanked his entire Portfolio for the purpose of treatment of his friend’s daughter who is a victim of Blood Cancer. I am praying for the child and hope you too..

A few history..

Mohit joined in the Portfolio Advisory Services in the month of August 2009 with an existing holdings of around 16000/-(3 stocks). He gradually accumulated the recommended stocks in a disciplined manner with his own affordable funds.

Without much preface, I would like to place a couple of screenshots of our mail conversations with his permission.

Please don't take it as a self praising effort.. but I wish to make this space useful for every kind of investors especially youngsters with limited funds.

Comment please...

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regards

Shabu Thachat
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Be cool...

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Dear Readers,

The Market is swinging in an annoying manner on global cues and subsequent profit booking ... It is continuously testing the patience of investor community by last few sessions. I wish to say, please don’t be panic on this flux and treat the instance as a simple self balancing tremble by the market prior to stand solid. History says, it is a common episode with every developing market/economy/country. Instead of getting mystified, long term investors have to exploit this opportunity by accumulating good scrips in better valuations, but in small batches.

This Post is primarily intended to my clients who are subscribing the Portfolio Advisory Services. The recent fluctuations in the indices put few of them in bit confusions and are reflecting in their mails/calls. I have received few mails also enquiring the relevant strategy at such occasions. I am using this venue to clarify my stance towards the queries.

I usually specify the buy range for every recommended scrips to my clients. Reaching that price range figures are associated to various stock specific fundamental/technical issues as well as the then market conditions. Try to enter at the lower price levels at your best and having a stock at the cheapest rate is simply your smartness. Buying at 1 or 2% higher from the upper levels of suggested buy ranges does not make any impact as we are likely to invest for few years rather than trading. I would like to refer the following precious post of my friend Mr. Viral Rajnikant Dholakia as a better guideline for the buying strategy in such market conditions. The great accumulation theory in the following link will always work better for you and especially in the ongoing spell.

http://stock-mkts.blogspot.com/2009/03/strategy-for-investment.html

I have placed a screen shot of Portfolio Management Screen maintained in moneycontrol.com by one of my small scale investor client from Pune, Mr Kedar Raghunath. He is a student at his 23 and a fresher to market. He is investing by the savings from his pocket money. Just see how he is brilliantly accumulating a stock with his limited fund levels.

The Rupee Cost Averaging is an established theory and you can apply this tactic without any hesitation on the scrips recommended to you during the course of this service. Don’t get panic on abrupt falls on any of the scrip as I have firm reasons for that. It is a matter of time and you have to make use of every such opportunity. I am closely watching the market conditions and the fluctuations happening on each and every recommended scrips. As a rule, I recommend stocks to my clients only after exhaustive homework by considering various fundamental aspects as well as the future prospects of the company. Nearly all of these companies must have eminence in their respective fields and their growth potentials must be in the pink. Recommending a stock to my client means, I am keeping a robust faith on the Company/Management and the stock is rationally competent to deliver superior returns in the long run. Such stocks can falls too with the collective emotions, but always recovers faster when the trend favors. The every moment between both of these points, fall and recovery is yours and you have to use at its best according to your cash reserves.

Another sort of stocks, few small caps including Pennies are excluded from the above category, which may have not adequate histories to track or may be with thin technicals. Still, I suggest these stocks after the same amount of exertion, by analyzing the industry perception and available statistics. The age factor and risk tolerance level of the client is an important aspect which influences the small cap/penny recommendations. If you are a person above 50, I barely recommend you any penny stock unless you asked for. Penny stocks can be turns to massive multibaggers or may bestow you good fortunes, but equally disastrous. Please refer the following links for a better picture on my previous recommendations.

http://www.stockinfos.in/2009/04/penny-passion-part-i.html

http://www.stockinfos.in/2009/12/historic-year-2009.html

http://www.stockinfos.in/2009/09/review-on-my-recommendations.html

Let me conclude this post here as I hope, I have answered collectively to the queries.

God Father Buffet says “Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it”.

Shabu Thachat – sthachat@gmail.com

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Multibagger series - a solid player

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Dear Readers,

The following is a guest post by Mr Jagadeesh Reddy Yaramada, one of my esteemed clients and a young, fervent investor from Hyderabad. He has prepared an admirable research on an emerging company involved in the niche, LED Lighting and Display sector. The article is with ample statistics and he has concluded with his viewpoint on the business model and the future potentials of the product range with logical means. I am publishing this article with pleasure. Request my readers/clients to have a close read and comment…

MIC Electronics

With current numbers there is a huge gap between the demand and supply of electricity in India and this gap is expected to widen in future, with only so much of electricity available and though new power projects are being built, but the demand is also expected to rise at the same pace. So it is very critical to use the electricity produced efficiently and the company we are talking about operates in the area of LED Lighting and displays, which are 10 times more efficient.

It is estimated that electricity for lighting costs about $185 billions annually, the globe consumes 2300 TW.h of power and generates about 2bn tones of toxics annually. Since LEDs are about 10 times more efficient and since Governments all over the world are looking to reduce carbon emissions, I think MIC stand to gain from this.

Company Snapshot

BSE Code: 532850

Market Cap: 443.87 Cr

CMP: 43.75(09/02/2010)

EPS: 5.72

P/E: 7.65

52Wk High/Low - 59.90/14.35

Book value: 28.80

Face Value: 2.00

Chairman: Dr. M V Ramana Rao

LED Lighting

MIC has a vast range of LED lighting solutions available to cater from homes to large industries. The application potentials of the LED lights are enormous. The lighting gamut covers Architectural lighting, Channel letter/contour lighting, Consumer portable lights, Residential lighting, Retail Display lighting, Entertainment lighting, Safety/Security lighting, Outdoor lighting, Off-grid lighting(solar powered and others), Commercial / Industrial lighting and Automotive applications.

Indian Railways planning to modernize over 599 railway stations across the nation and decided to replace the single color LED displays with the multi color LED displays. MIC being the only Indian company approved by the RDSO and there is a noteworthy business break of more than Rs.700 cr over the next four to five years.

MIC has secured an order for transforming 10000 street lights of various kinds to LED lights in the city of Rajahmundry (Andhra Pradesh). More cities from in and out of India are expected to transform to the high efficient LED solar lighting systems as a better power saving option. City of Pittsburgh (USA) and Campbell (Australia) has been selected MIC's street lights for evaluation and the lights are undergoing trials. Is the beginning?

The portable Solar Rechargeable LED Lantern has been recognized by The Energy Resources Institute (TERI) and they have declared the adoption of MIC’s solar lanterns for their prestigious 'Light a Billion Lives' (LaBL) program. It is expected that, each Lantern is expected to replace 500-600 liters of Kerosene in general, thus mitigating about 1.5 tons of Carbon Dioxide emissions.

LED Displays

MIC's flagship products, LED Video Displays (indoor/outdoor/mobile) have become an integral part of Sports Stadiums, Transportation Hubs, Digital Theatres and Theme Parks, Advertisements and Public Information Displays in Railways and Airports. MIC has already partnered with IPL for providing LED displays. The company is mastered in following range of LED displays.

Indoor Video Screens
Digital Posters
Outdoor Video Walls
Mobile Video Displays
Digital Billboards
Digital Posters
Ticker Displays
Perimeter Displays
Variable Signage Displays
Networked Displays
Interactive Displays
Passenger Information Displays
Digital Theme Parks
3-D Displays


Recognitions

ISO 9001: 2008 certification.

Approval from MNRE for Solar LED Lantern.

Selected for "Best Under 1 billion" by Forbes Asia, one of the 22 Indian companies among 200 of Asia Pacific region.

RDSO Approval for True Colour Passenger Information Display System.

Only Indian company having ‘Design-to-Display’ capabilities in True colour LED video display Segment.

The first company to introduce LED Mobile Video Display in India, Middle East & South Africa

My View:-

Over 1.6 billion people in the world lack access to electricity and 25% of them live in India. I am expecting these solar lanterns to find more demand in future. Governments have already started talking about reducing emission and saving energy, the LED lighting developed by MIC would find usage in more and more cities across the globe in coming years. Few cities have already started the transformation process. With India’s focus on improving Infrastructure, MIC Electronics appliances like LED sign boards, advertising screens would find a good demand in areas like Expressways, new Highways, Airports or in such public venues.

MIC’s LED Displays have already been deployed at a number of sports stadiums across the world and many more stadiums would soon be follow the suit. There is around 1000 cr marketplace with Indian Railways itself for supplying coach lights, signal lights, emergency lights and for coloured display boards, sign boards and advertising screens. MIC as the only company approved by Research Design and Standards Organization (RDSO) has set to gain good business from the world’s largest Railways.

I am expecting, much more organizations will transform their Industrial and Outdoor lighting systems to more efficient and renewable solar LED lighting systems, which could provide a very good opportunity to MIC. LED lights with their long life span and less maintenance costs are expected to find use in Refrigerators, Traffic lights, Petrol pumps, mobile phones and for a lot others in the 24x7 category.

by Mr Jagadeesh Reddy Yaramada, Hyderabad

Thanks a lot Jagadeesh. I too believe that MIC is in the path of making a multibagger, but we have to offer adequate time to the management. The appealing range of products is compelling me to think vibrant on this scrip. Like all the other products, the fast growing advertising industry will undeniably boost the MIC business in very near future. It seems the flex board advertising trend may shift to the MIC LED displays in short span of time which will illuminate our malls, cities and highways.

Thanks again and keep it up...

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