We are glad to introduce our new service – Nano Champs (deeply undervalued & undiscovered micro caps) with an objective to achieve 10X returns in a period of 6 years (6Y-10X). Under this service, we will research on micro-sized companies with market capital of less than 100 crores and put our efforts to identify the companies which are not only deeply undervalued (available well below their intrinsic value) but also have potential to grow at a faster pace.
As there is always a higher risk involved while investing in micro caps, we will have a well diversified basket of 10 stocks from different sectors / industries under this service. Based on our past experience, we realized that micro caps have the potential to deliver maximum returns (higher than small caps and much higher compared to mid and large caps). However, as the universe of micro caps is large enough, picking the right companies requires extensive research. Another very important aspect of investing in micro caps is patience, stock prices of micro caps consolidate for longer time period and deliver maximum returns in shortest span of time. Some of our micro caps which we picked when market capital was less than 100 crores have created enormous wealth for our members over last decade.
You will agree that Investment decisions for the long term can’t be taken by timing the market movement. It is important to understand the Industry potential, company’s fundamentals and valuations with a real long term perspective. This service is suitable for those investors who have an investment horizon of more than 5 years, want to see some of their stocks turning out to 5X, 10X, 20X or even 50X to 100X over next 5 to 10 years, and have the courage to digest the negative returns of 40 to 70 percent from top during market crash / bear phase of the market.
NANO CHAMPS SUBSCRIPTION DETAILS: |
SUBSCRIPTION: | 1 YEAR & 3 YEARS |
SUBSCRIPTION PRICE (1 YEAR): | INR 13,000 |
SUBSCRIPTION PRICE (3 YEARS): | INR 33,000 |
NO. OF REPORTS: | BI-ANNUALLY (2 PER YEAR) |
EACH REPORT CONTAINS: | 10 NANO CHAMPS STOCKS UPDATE |
ENTRY / EXIT UPDATE: | AD HOC (AS & WHEN THE NEED ARISE) |
PROFIT BOOKING: | AS PER THE PROFIT BOOKING STRATEGY |
ACCESS TO REPORT & UPDATES: | WILL BE SENT TO REGISTERED EMAIL ID |
1ST REPORT SCHEDULE RELEASE | MID OCT 2022 |
NANO CHAMPS - INVESTMENT HORIZON: 5 YEARS & ABOVE
The time frame over which investors stay invested in a particular asset class is referred to as an investment horizon. Determining the investment horizon is one key decision an investor must take in the investing journey.
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.
BSE SMALL CAP INDEX - YEARLY RETURNS |
YEAR | 1ST JAN START YEAR | 1ST JAN NEXT YEAR | RETURN % |
2003* | 834.59 | 2481.95 | 197.4% |
2004 | 2481.95 | 3505.83 | 41.3% |
2005 | 3505.83 | 6027.56 | 71.9% |
2006 | 6027.56 | 7004.1 | 16.2% |
2007 | 7004.1 | 13703.07 | 95.6% |
2008 | 13703.07 | 3810.41 | -72.2% |
2009 | 3810.41 | 8491.73 | 122.9% |
2010 | 8491.73 | 9845.05 | 15.9% |
2011 | 9845.05 | 5556.48 | -43.6% |
2012 | 5556.48 | 7452.88 | 34.1% |
2013 | 7452.88 | 6649.16 | -10.8% |
2014 | 6649.16 | 11225.22 | 68.8% |
2015 | 11225.22 | 11940.75 | 6.4% |
2016 | 11940.75 | 12190.15 | 2.1% |
2017 | 12190.15 | 19279.96 | 58.2% |
2018 | 19279.96 | 14766.86 | -23.4% |
2019 | 14766.86 | 13786.69 | -6.6% |
2020 | 13786.69 | 18261.03 | 32.5% |
2021 | 18261.03 | 29807.95 | 63.2% |
2022 | 29807.95 | (01 Sep'22) 28789.30 | -3.2% |
* starting 1st April 2003 | Source: BSE |
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.”
NANO CHAMPS - EXPECTED RETURNS:
NANO CHAMPS – EXPECTED RETURNS: | BEST CASE SCENARIO |
COMPANY NAME | MARKET CAPITAL | INV. AMOUNT | PERIOD (IN YRS) | X TIMES | EST. CAGR | NET RETURNS |
XXX1 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX2 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX3 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX4 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX5 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX6 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX7 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX8 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX9 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XX10 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
INV. AMOUNT | 1,00,000 | ROI: | 10X | 47% | 1000000 |
As illustrated in the table above, if all 10 Nano Champs stocks deliver 10X returns over period of 6 years (best case scenario), the investment capital will grow by 47% CAGR. If only 4 stocks out of 10 deliver 10X returns, other 3 stocks deliver half of expected returns and remaining 3 stocks deliver 0 returns, investment capital with grow at CAGR of 35% delivering 6X returns.
NANO CHAMPS – EXPECTED RETURNS: | BULL CASE SCENARIO |
COMPANY NAME | MARKET CAPITAL | INV. AMOUNT | PERIOD (IN YRS) | X TIMES | EST. CAGR | NET RETURNS |
XXX1 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX2 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX3 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX4 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX5 | < 100 CR | 10,000 | 6 | 7X | 38% | 70000 |
XXX6 | < 100 CR | 10,000 | 6 | 5X | 31% | 50000 |
XXX7 | < 100 CR | 10,000 | 6 | 5X | 31% | 50000 |
XXX8 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XXX9 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XX10 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
INV. AMOUNT | 1,00,000 | ROI: | 6X | 35% | 600000 |
Even if we take bear case scenario considering that only 2 out of 10 stocks deliver 10X returns and another 3 stocks deliver half of expected returns and remaining 5 stocks deliver 0 returns, investment capital will be quadrupled (4 times) in period of 6 years achieving CAGR of 26% which is also significantly higher compared to any other asset classes or major indices - Sensex and Nifty.
NANO CHAMPS – EXPECTED RETURNS: | BEAR CASE SCENARIO |
COMPANY NAME | MARKET CAPITAL | INV. AMOUNT | PERIOD (IN YRS) | X TIMES | EST. CAGR | NET RETURNS |
XXX1 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX2 | < 100 CR | 10,000 | 6 | 10X | 47% | 100000 |
XXX3 | < 100 CR | 10,000 | 6 | 5X | 38% | 50000 |
XXX4 | < 100 CR | 10,000 | 6 | 5X | 38% | 50000 |
XXX5 | < 100 CR | 10,000 | 6 | 5X | 38% | 50000 |
XXX6 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XXX7 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XXX8 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XXX9 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
XX10 | < 100 CR | 10,000 | 6 | X | 0% | 10000 |
INV. AMOUNT | 1,00,000 | ROI: | 4X | 26% | 400000 |
However, we are confident to achieve CAGR returns of 35% to 45% over a period of 6 years by monitoring performance of these companies and taking corrective measures through entry in new stocks / exit in existing stock and following profit booking strategy.
NANO CHAMPS - PROFIT BOOKING STRATEGY:
PROFIT BOOKING STRATEGY ILLUSTRATION: |
NANO CHAMPS | PORTFOLIO ALLOCATN | INITIAL / POST INV. VALUE | ROI | CURRENT VALUE | PROFIT BOOKING | PROFIT BOOKING AMOUNT |
STK-01 | 1.00% | 10,000 | 3X | 30,000 | 30% | 9,000 |
STK-01 | 0.70% | 7,000 | 5X | 35,000 | 30% | 10,500 |
STK-01 | 0.40% | 4,000 | 10X | 40,000 | 100% | 40,000 |
As per profit booking strategy, 30% profit has to be booked once a particular Nano Champ stock delivers 3X returns, another 30% profit will be booked once stock turns 5-Bagger and full profit booking can be done once Nano Champ stock delivers 10X returns.
Q: Why profit booking before 10X returns? |
A: Mostly, once a stock delivers 3X or say 5X returns over a period of time during market upturn, it also falls by 30 – 60 percent during market downturn. Profit booking strategy not only ensure that you take out your initial investment capital but also give you a cushion to invest in same stock later at lower levels during market / sector down cycle.
Q: Why initial investment allocation is just one percent? |
A: As Nano Champs are micro cap companies having less liquidity and high volatility, we suggested 1% allocation in each stock. In fact, just 1% allocation can do wonders in long term. Assuming that your portfolio value is of 10 lakh, you invest 10,000 each (1% of 10 lakh) in all 10 Nano Champs (1 lakh allocation in total 10 stocks) and continue to hold them, now If only 2 Nano Champs stocks turn out to be 50-Bagger stocks in period of 6 to 12 years, it will make up your entire portfolio value (10 lakhs).
NANO CHAMPS - STOCK SELECTION PARAMETERS:
QUALITATIVE PARAMETERS |
Quality of Management – able & honest with good integrity |
Promoters 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 |
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 |
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 MAR’11 | 56 CR | 21-BAGGER | 66% | DOWNLOAD |
2 | WIM PLAST | 30 AUG’11 | 123 CR | 17-BAGGER | 60% | DOWNLOAD |
3 | KOVAI MEDI | 27 OCT’11 | 126 CR | 13-BAGGER | 53% | DOWNLOAD |
4 | ROTO PUMPS | 05 AUG’12 | 32 CR | 9-BAGGER | 44% | DOWNLOAD |
5 | ACRYSIL INDIA | 25 NOV’12 | 51 CR | 8-BAGGER | 41% | DOWNLOAD |
6 | TCPL PACK | 31 JAN’13 | 65 CR | 11-BAGGER | 49% | DOWNLOAD |
7 | DYNEMIC PRO | 29 JUL’14 | 52 CR | 6-BAGGER | 35% | DOWNLOAD |
8 | INDO BORAX | 10 APR’16 | 100 CR | 7-BAGGER | 38% | DOWNLOAD |
9 | STYLAM IND. | 08 MAY’16 | 159 CR | 13-BAGGER | 53% | DOWNLOAD |
10 | SAHYADRI IND | 30 AUG’17 | 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. Please note that Nano Champs will not cover the stocks which were already covered under Hidden Gems service, so there will not be any over-lapping of stocks. However, there is a possibility that Nano Champs of today may get recommended after couple of years under Hidden Gem service so that our members can either continue holding the stock or may increase the investment allocation from 1 percent to 2-3 percent of portfolio
NANO CHAMPS - FAQS:
FREQUENTLY ASKED QUESTIONS |
Q: What is the subscription period of Nano Champs? |
A: We offer 1 year and 3 years subscription for Nano Champs service. You need to renew your subscription every year / every 3 years to continue receiving the Nano Champs update.
Q: How many reports will I get under Nano Champs service? |
A: You will get 2 detailed reports with coverage of 10 Nano Champs every year. Moreover, you will also receive individual stock specific update in case of any entry of new stock / exit of existing stock or profit booking update as per defined profit booking strategy.
Q: Shall the report covers 10 new stocks in every detailed report? |
A: This report will cover 10 Nano Champs stocks and update about these stocks only in next issue. As this report will be released on 6 monthly basis, there may be changes (entry / exit) based on covered companies business developments / change in govt policies / sector tailwinds or headwinds etc
Q: What if a particular stock rice goes down by 30% to 40%? |
A: Nano Champs are less liquid stocks, hence we will advise a price range to accumulate them slowly over a period of time. There is a high possibility that a particular stock price rises or fall by 30 to 40 percent in short term, however being a long term investor, you need to simply hold the stock.
Q: What is suggested investment allocation in Nano Champs? |
A: As Nano Champs are micro caps, we suggest maximum portfolio allocation of 10 percent in Nano Champs, 1 percent allocation to each Nano Champ stock.| |
| NANO CHAMPS |
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PRICE - INR 13,000 (1 YEAR) & INR 39,000 33,000 (3 YEARS) |
| MICRO CAP REPORTS |
| REPORT - 2 / YEAR OF 10 MICRO CAPS |
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SUBSCRIPTION OPTION | PAY VIA CARD (3% CHARGES EXTRA) |
Nano Champs– 1 Year - Rs. 13.000 | SUBSCRIBE |
Nano Champs– 3 Year - Rs. 33,000 | SUBSCRIBE |
Please note that discounted price is for limited period only. Do write to us at info@saralgyan.in in case of any queries, we will be delighted to assist you.
Regards,
Team - Saral Gyan
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