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NANO CHAMPS (DEEPLY UNDERVALUED & UNDISCOVERED MICRO CAPS)

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Thursday, January 5, 2023

Nano Champs - Performance Update

Dear Reader,

The year 2022 turned out be a dull year for broader market as more than 80% small and mid caps are down by 30% to 70% from their peak made in 2021. New investors who invested in the year 2020 - 2021 thinking that making money from stock market is very easy might have experienced the harsh reality looking at their losses widening in the year 2022. Since the equity market is volatile, it is advisable to invest for the medium to long term.

In a time frame of 5 years and beyond, even despite the volatility, markets tend to give an above average return. For example, Sensex has given a CAGR of 17% over the past 5 years which means investing for the long term is a gainful strategy.

It is often said that a consistent patient investor always wins in the long term. Warren Buffet rightly said that “The stock market is a device for transferring money from the impatient to the patient.”

We released our first issue of Nano Champs [Deeply Undervalued & Undiscovered Micro Caps] report on 09 Oct 2022. The objective of Nano Champs is to achieve 10X returns in a period of 6 years (6Y-10X). Under this service, we have researched on micro-sized companies with market capital of less 120 crores and put our efforts to identify the companies which are not only deeply undervalued but also have the potential to grow at faster pace.

The market capital of 10 Nano Champs stocks covered in the report is in the range of 25 crores to 120 crores. 
As there is always a higher risk involved while investing in micro caps, we have created a well diversified basket of 10 stocks from different sectors / industries. We advise our members to limit their maximum investment exposure in Nano Champs to 10 percent of their equity portfolio. It means, if your equity portfolio is of INR 10 lakh, the maximum allocation in Nano Champs will be 1 lakh i.e. 10k in each Nano Champs stock (maximum 10% in 10 Nano champs, maximum 1% of your equity portfolio in each Nano Champs).

In this report, for each Nano Champs stock, we have covered information related to:
i) Company's Business at a Glance (Important data points)
ii) Company's Background
iii) Financial Performance
iv) Investment Rationale
v) Recommendation & Buying Strategy

We will review these stocks on 6 monthly basis, we may also release an ad-hoc update in case of any major change or development happens in any of these particular companies. As Nano Champs are micro caps, the daily trading volume in some of Nano Champs is just a few thousand shares, hence its advisable to accumulate them over next few weeks / months as per buying strategy rather than aggressively buying them at one go.


Below is the performance update of 10 Nano Champs stocks released on 09 Oct 2022.

Nano Champs Stocks

NANO CHAMPS - STOCK SELECTION PARAMETERS:

i) QUALITATIVE PARAMETERS:
  • Quality of Management - able & honest with good integrity
  • Promoter holding - should not be less than 45%
  • Pledging of shares by Promoters - should be nil
  • Demand & supply gap in the Industry - sustainability of business
  • Growth drivers - scalable business / catalyst in business
ii) QUANTITATIVE PARAMETERS:
  • Cash Flows - Positive operating cash flows
  • Leverage - Debt to equity ratio should be less than 1.5
  • Capacity expansion - Capex and financing through equity / debt
  • Visibility of future growth - Expected revenue and profitability
  • Management of Accounts - Any change in accounting policy
iii) VALUATION PARAMETERS:
  • Business valuations should be below its intrinsic value
  • Market capital to Revenue / Sales - should be less than 1
  • Relatively cheap business -  compared to peers and overall market

PAST PERFORMANCE (MARKET CAP < 200 CR):

S.NO

COMPANY

RELEASE DATE

MARKET CAP

X-BAGGER (IN 6 YRS)

% CAGR

OLD REPORT

1

CAMLIN FINE

27 MAR11

56 CR

21-BAGGER

66%

DOWNLOAD

2

WIM PLAST

30 AUG11

123 CR

17-BAGGER

60%

DOWNLOAD

3

KOVAI MEDI

27 OCT11

126 CR

13-BAGGER

53%

DOWNLOAD

4

ROTO PUMPS

05 AUG12

32 CR

9-BAGGER

44%

DOWNLOAD

5

ACRYSIL INDIA

25 NOV12

51 CR

8-BAGGER

41%

DOWNLOAD

6

TCPL PACK

31 JAN13

65 CR

11-BAGGER

49%

DOWNLOAD

7

DYNEMIC PRO

29 JUL14

52 CR

6-BAGGER

35%

DOWNLOAD

8

INDO BORAX

10 APR16

100 CR

7-BAGGER

38%

DOWNLOAD

9

STYLAM IND.

08 MAY16

159 CR

13-BAGGER

53%

DOWNLOAD

10

SAHYADRI IND

30 AUG17

166 CR

5-BAGGER

36%

DOWNLOAD


These companies were covered under Hidden Gems service over last 10 years, all above companies market capital was less than 200 crores at the time of recommendation. Over last 7 to 11 years, companies like Acrysil (51 Cr), Camlin Fine Sciences (56 Cr), Kovai Medical (126 Cr), TCPL Packaging (65 Cr), Roto Pumps (32 Cr) etc. have multiplied investment by 20X to 50X. You can click on the download link to access these reports.

Ongoing market correction is giving good opportunity to long term investors to start accumulating good quality companies at lower levels. Do not get panic if you recently started investing, riding through difficult times in equities is most important step towards long term wealth creation. In fact, we need to be greedy when others are fearful. If you wish to receive our first issue of Nano Champs you can subscribe to the service. 

SUBSCRIPTION OPTION

PAY VIA CARD

(3% CHARGES EXTRA)

Nano Champs– 1 Year  - Rs 12,000 10.800 (-10%)

SUBSCRIBE

Nano Champs– 3  Year - Rs. 30,000 27,000 (-10%)

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Click here to know more about Nano Champs service.

We are pleased to inform you that you can avail discount upto 30% and valuable freebies under Merry Christmas - Happy New Year 2023 offer. Click here for details.

Regards,
Team - Saral Gyan