2 years down the line

It has been more than 2 years now after we started Famous Inc. And it brings me immense pleasure in learning that each one of us are willing to take it forward and are gaining further vigor in this J.

We have learnt many lessons in the past and these days we are learning another valuable lesson of having to book our profits.

In one of my previous analysis of each company that we were holding, it was found that BHEL is not growing with respect to sales or turnover but the stock prices were rocketing up. One year back BHEL was trading at around 1200 (though it was 2400 at that time, we are dividing it by 2 as it was split after that). As Srikanth has mentioned the profits of BHEL has grown by 16% that means the stock price also should have grown the same manner – that is around 1400.

But the stock had hit a high of 2900!! For that the company should have grown by more than 100% - that has not happened. So what we are seeing now with BHEL is very normal. That is why fundamentals are important. But if we would have sold BHEL at around 2900 we would have made more profits.

For how long will this carnage continue? Inflation is at around 7% and in US almost 80,000 jobs have been cut. There is no good news coming ahead. My suggestion is to sell all shares now and wait and watch for some time – probably for a month’s time.

when the tides are low

sensex has touched 16500 levels and famex stands at 11129

Date	Scrip	Price	Buy Qty	Value	Prsnt Qty	M Price	M Value	% Growth
3-Apr-06	RANBAXY	439.95	4	1759.8	4	367.5	1470	-16
5-Apr-06	BHEL	2347	1	2347	2	1905.4	3811	62
9-Jan-08	SUZLON	2242	1	2242	5	301.1	1506	-33
23-Jan-08	BHEL	2114	1	2114	1	1905.4	1905	-10
23-Jan-08	BHARATFORG	294.5	4	1178	4	269.95	1080	-8
25-Jan-08	RELPETRO	167.95	9	1512	9	150.85	1358	-10
		Total		11152			11129	-0.2

when all of our capital is invested

Date	Scrip	Price	Buy Qty	Value	Prsnt Qty	M Price	M Value	% Growth
3-Apr-06	RANBAXY	439.95	4	1759.8	4	369.25	1477	-16
5-Apr-06	BHEL	2347	1	2347	2	2164.55	4329	84
9-Jan-08	SUZLON	2242	1	2242	5	339.55	1698	-24
23-Jan-08	BHEL	2114	1	2114	1	2164.55	2165	2
23-Jan-08	BHARATFORG	294.5	4	1178	4	288.95	1156	-2
25-Jan-08	RELPETRO	167.95	9	1512	9	173.05	1557	3
		Total		11152			12382	11.0

Our investment has grown by 11%. To be able to double our capital we should aim at growing by 6% every month. That is quite challenging, considering that fact that the year 2008 would be the most difficult bull markets.

Name	Capital	Large Caps	Mid Caps
Aravind
Bhargav	1000	592	408
Bunni
Chandu	1500	844	656
Kishore	1000	755	245
Kurian	1000	185	815
MSR
NLK
Ravi	2500	1685	815
Srikanth	1000	185	815
Thomas	1152	837	315
TRK	1000	865	135
Uday	1000	755	245
Vinodh
Total	11152	6703	4449
Invested	11152	6703	4449

By the end of February 08, we should be at a total value of 13125.

when most of our money is invested

Date	Scrip	Price	Buy Qty	Value	Prsnt Qty	M Price	M Value	% Growth
3-Apr-06	RANBAXY	439.95	4	1759.8	4	352.3	1409	-20
5-Apr-06	BHEL	2347	1	2347	2	2148.15	4296	83
9-Jan-08	SUZLON	2242	1	2242	5	371.05	1855	-17
23-Jan-08	BHEL	2114	1	2114	1	2148.15	2148	2
23-Jan-08	BHARATFORG	294.5	4	1178	4	291.5	1166	-1
		Total		9641			10874.9	12.8
		Balance		1359

It is now that we have started taking some serious action in Famous Inc. Most of our funds is invested now (there is a balance of only 1359).

Our over all growth is 12.8% of the funds invested. But if we take the total money set aside for investing, we are on a negative growth (we have a present market value of 10875).

The first investment of BHEL grew by 83% while Ranbaxy and Suzlon has dragged us down. Suzlon might however correct itself by the first week of February, where as there are doubts on how Ranbaxy would perform.

We should invest the balance of 1359 tomorrow (Friday - 25/01/2008) and sell Ranbaxy when it reaches the next high in the coming fortnight.

when we took the next move

Finally after almost 2 years we decided to invest in one more share. Our resolution for the year of 2008 is to grow by 100% and to complete the investment of the balance 6106.8 by the end of January 2008.

After discussion over few shares we finally decided to buy Suzlon at the market price. We have managed to buy the share at Rs. 2242 /-. This share qualifies to enter the Large Caps venture. As there was a shortage in the allocated funds in Large Caps, little amount was borrowed in to it (in order to get things moving).

Name	Capital	Large Caps		Mid Caps
Aravind
Bhargav	1000	278		500
Bunni
Chandu	1500	695		805
Kishore	1000	417		300
Kurian	1000	0		1000
MSR
NLK
Ravi	2500	1391		1000
Srikanth	1000	0		1000
Thomas	1000	417		200
TRK	1000	834		166
Uday	1000	557		300
Vinodh
Total	11000	4589		5271
Invested	6349	4589		1760
Available Cash	4651	0		3940

We still have a total of Rs. 4651 /- as balance. We should aim at taking holdings in good Mid Cap shares.

when the tides are high

BHEL share has almost doubled (it is now at Rs. 2150 /- after the 1:2 split). However Ranbaxy has been on rocky waters and has just surfaced to the levels that we had bought it at - Rs. 430 /-.

Out of the Rs. 11,000 /- that we collected, we had invested Rs. 4106 /-. This invested portion has now become almost Rs. 6,000 /- - that is 46% returns. But when we take the growth rate with respect to the total amount collected it is just 19%.

Famous Inc. as on date has earned us all around Rs. 2000 /-.

Let us all forge ahead and hope for better waves in the coming days with much more action.

As on 07-Jun in the Bond's year

Large Caps has been doing good with almost 13% rise in value as BHEL had a bonus split and is hovering at Rs. 1,350 /- range.

Mid Caps has lost its sheen for quite some time and has dropped to an extent of 12% and is quoting at Rs. 380 /-.

The fundamentals of BHEL still seems good and appears to be a definite winner in the long run.