Nemish Shah Portfolio: Top 5 Stocks

The last two months have been topsy-turvy for Indian equity markets. The ongoing selloff has caused benchmark indices to lose more than 6%.

Investing and trading in such markets can be daunting task, as it calls for exploring market winning strategies to survive economic downturns.

Most retail investors lack this expertise. However, the widely held investment technique of coattail investing can help.

The concept of coattail investing is simple. Mimic the investment picks of financial gurus and hedge fund billionaires.

One such tracked billionaire in the Indian market is Nemish Shah, the man who took Infosys public.

Nemish Shah, the co-founder and director of Enam Holdings, is a value investor who likes to stay in the background.

Today with seven companies in his portfolio, his net worth is over Rs 21.4 billion (bn).

Let's take a look at the top 5 stocks in Nemish Shah's portfolio in value terms (not volume).

Please note the source of holdings listed below is from Ace Equity, and it may or may not be a complete list of holdings.

#1 Lakshmi Machine Works

The first stock on this list is Lakshmi Machine Works.

According to the shareholding pattern of Lakshmi Machine Works, Nemish Shah holds an 8.9% stake in the company or 0.9 million (m) shares as of December 2022.

Considering the company's current market price of Rs 10,250 as of 24 March 2023, Nemish Shah's total value in Lakshmi Machine Works comes to around Rs 10 bn.

He invested in Lakshmi Machine Works back in 2015. Here's how his holding in Lakshmi Machine Works has varied in recent years.

Quarter Ending	No of Shares	stake (%)
Mar-21	994,873	9.32
Jun-21	983,873	9.21
Sep-21	983,873	9.21
Dec-21	973,873	9.12
Mar-22	963,873	9.03
Jun-22	963,873	9.03
Sep-22	958,873	8.98
Dec-22	958,873	8.98

Data Source: BSE

His bet on the company came when Lakshmi Machine Works launched the world's fastest comber LK69 to enhance productivity levels.

Since his bet in 2015, shares of the company have climbed from Rs 3,500 to Rs 10,500, registering a gain of 200%.

However, the ace investor has been constantly disinvesting his stake in the company in recent quarters.

This reduction could be on the back of a substantial reduction in demand due to current economic conditions, high inflation, and poor customer sentiment in these markets.

For the December 2022 quarter, it reported a 33.9% YoY rise in revenue to Rs 12 bn. Its net profit for the quarter came in at Rs 895.2 m, up 75.5% from the December 2021 quarter.

This growth was mainly driven by falling input prices clubbed with higher rising demand in the international market.

For the upcoming quarters, it plans to launch two state-of-the-art machines, the latest winding machine and an Airjet spinning machine, to provide smart AI-enabled solution.

#2 Asahi India Glass

The second company on this list is Asahi India Glass.

According to the latest shareholding pattern of Asahi India Glass, Nemish Shah holds a 6% stake or 14 m shares of the total equity.

Considering the company's current market price of Rs 450 as of 24 March 2023, his total value in Asahi India Glass stands at Rs 6.7 bn.

Mr Shah first invested in the company in 2015. After holding shares till December 2018, his name was missing from the company's key shareholder list till the end of the September 2022 quarter, as his stake slipped below 1%.

Since his investment in the company in December 2015, shares of the company have rallied over 200%.

After reinvesting in September 2022, he has kept his stake in the company constant.

Going forward, the company is set to benefit from the boom in the solar glass sector due to an increasing focus on renewal sources of energy like solar.

Also, with the shift in trend, many commercial buildings, as well as residential apartments, are shifting to glass for better aesthetics, creating more demand for glass companies.

For the December 2022 quarter, Asahi India reported a 21% YoY rise in revenue at Rs 10 bn. Its net profit for the quarter came in at Rs 789 m, down 19% YoY, on account of lower realisations.

#3 Elgi Equipments

Third on the list is Elgi Equipments.

According to the December 2022 shareholding pattern of Elgi Equipments, Nemish Shah Agarwal holds a 1.69% stake in the company or 5.3 m shares.

Considering the company's current market price of Rs 370.8 as of 24 February 2023, Nemish Shah Agarwal's total value in Elgi Equipments is Rs 2.6 bn.

He initially added 5.3 m shares of the company to his portfolio in December 2015. Since then, his holding has remained constant.

After his investment in the company, shares have been on an uptrend, rallying over 550% on the back of financial growth.

The company is cautiously optimistic that it will achieve its goals for the financial year 2023 even if strong headwinds occur in the future.

It is also set to benefit from the government plans to incur a capital expenditure of Rs 7.5 (trillion) tn in the financial year 2023, which is 24% more than the previous fiscal year.

For the December 2022 quarter, Elgi Equipments reported a 17% YoY rise in revenue at Rs 7.7 bn. Its net profit for the quarter rose 62% YoY to Rs 746 m. This growth was due to higher realisation due to falling input costs.

#4 E.I.D Parry (India)

Fourth on the list is E.I.D Parry (India).

As of December 2022, the shareholding pattern of E.I.D Parry shows that Nemish Shah holds a 1.2% stake in the company or 2 m shares in total.

Considering its current market price of Rs 465.5 as of 24 March 2023, Nemish Shah's total value in E.I.D Parry is Rs 977 m.

Initially, Nemish Shah bought 2 m shares of E.I.D Parry in December 2015. Since then, his holding has remained constant.

After his investment in the company, shares have been on an uptrend due to a sharp spike in sugar prices.

EID Parry (India) has always been at the forefront of innovation and sustainability. Upgrading manufacturing processes from time to time has helped the company improve its efficiency.

This resulted in higher revenue and profits. In the last five years, its revenue and net profit have grown at a CAGR of 8.9% and 24.9%, respectively.

Further, it has a noteworthy international presence and exports its products to over 40 countries.

For the December 2022 quarter, it reported a 51% YoY rise in revenue to Rs 99 bn. Its net profit for the quarter rose 11% YoY to Rs 49 bn. This growth was due to higher realizations.

EID Parry (India) has laid out a capex plan on expanding its distillery capacity through greenfield and brownfield projects.

The capex is partly funded through internal accruals and partly through debt. Given that the company is debt free, it has scope to increase its leverage.

It is also exploring opportunities to convert its sugar, distillery, and biopesticides by-products into value-added products suitable for poultry and animal husbandry companies.

#5 Bannari Amman Sugars

Last on the list is Bannari Amman Sugars.

As of December 2022, the shareholding pattern of Bannari Amman Sugars shows that Nemish Shah holds a 1.8% stake in the company or 0.3 m shares in total.

Considering the company's current market price of Rs 2,727.5 as of 24 March 2023, Nemish Shah's total value in Bannari Amman Sugars is Rs 883 m.

Since his initial investment in December 2015, his holding has remained constant.

The sugar sector has been in a sweet spot for the last couple of months.

After the government established the Ethanol Blended Petrol (EBP) programme, the sugar industry became more valuable to investors.

Sugar exports are also on the rise, which has led to a sharp spike in sugar prices. But Indian sugar prices are yet to catch up with global rates.

Apart from this, rising consumption in the confectionery sector is estimated to grow at a CAGR of 6.4% by 2025, driving the sugar industry's development, as sugar makes up around 25% of the segment's raw materials.

For December 2022 quarter, Bannari Amman Sugars reported a 30% YoY rise in revenue to Rs 9.3 bn. Its net profit came in at Rs 408.5 m, up 39% YoY.

Going forward, the company plans to enhance its production capacity. The government has approved 243 projects, and banks have already sanctioned Rs 203.3 bn in loans, out of which Rs 110.9 bn has been disbursed.

For more details, see the Bannari Amman company fact sheet and quarterly results.

Apart from the above five, Nemish Shah is in Zodiac Clothing Company and RANE Engine valve as of December 2022.

Recently we also wrote to you about Sumeet Nagar Portfolio: top 5 stocks and Saurabh Mukherjea Portfolio: Top 5 stocks.

Stay tuned to get more updates on investment gurus as we cover more such pieces in the coming weeks.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...