Yes, it's a million-dollar question. If we have to select one business today like Infosys or Asian Paints for investment, which business would it be?
Considering buybacks and bonus issues.. Infosys is not way behind Asian Paints as it appears so due to the present share price.
My experience says one should select the business for investment on the following parameters and stay invested as long as the business is doing good on these parameters
1. High barriers to entry, almost monopolistic
2. High-quality management with a futuristic growth plan
3. Should be able to generate cash flow, Return on equity>15%, and Return on capital employed>20% over the last five years at least
4. Right allocation of funds, should be able to deploy cash toward the growth of business
Once we have selected the business for investment, one should remain invested for a long time with conviction as long as the business is doing well on above parameters irrespective of the stock price movements as the markets may not reflect the true valuations of the business for a fairly long time.
Like Warren Buffet says, if you can not hold a stock for ten years, don't ever think of buying that stock for ten minutes.
My experience says one should select the business for investment on the following parameters and stay invested as long as the business is doing good on these parameters
1. High barriers to entry, almost monopolistic
2. High-quality management with a futuristic growth plan
3. Should be able to generate cash flow, Return on equity>15%, and Return on capital employed>20% over the last five years at least
4. Right allocation of funds, should be able to deploy cash toward the growth of business
Once we have selected the business for investment, one should remain invested for a long time with conviction as long as the business is doing well on above parameters irrespective of the stock price movements as the markets may not reflect the true valuations of the business for a fairly long time.
Like Warren Buffet says, if you can not hold a stock for ten years, don't ever think of buying that stock for ten minutes.
A neighbor in society once asked me, Sir, can you suggest me one stock for investment,
ok, I can, do you have any preference, so I suggest as per that sir, I trust tata group, suggest me any company from Tata only
Another friend, who was not in need of an investment suggestion shared his style, that he invests only in PSU stocks. So people have their own way of investing journey, and generally, everyone must be making a profit as long they keep it for a longer period
If Infosys and Asian Paint with the above performance are considered as class toppers, then comparing TATA STEEL and TATA MOTORS for the same period, they have done miserable and won't even get passing marks!
ok, I can, do you have any preference, so I suggest as per that sir, I trust tata group, suggest me any company from Tata only
Another friend, who was not in need of an investment suggestion shared his style, that he invests only in PSU stocks. So people have their own way of investing journey, and generally, everyone must be making a profit as long they keep it for a longer period
If Infosys and Asian Paint with the above performance are considered as class toppers, then comparing TATA STEEL and TATA MOTORS for the same period, they have done miserable and won't even get passing marks!
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