@Intelligent Investing wrote:
Hello everyone, this website is a very useful resource for investors and I thank all the admins for doing a great job.
I believe in conducting thorough research before buying a share and everyone here should follow the same investing strategy. Without just listening to people, investors should learn to conduct their own research.
I personally feel that it is a good time to get into the market for the following reasons:
Fundamentally attractive (one of the lowest market P/E's in the region), global stability, interest rates decreasing, SL economy doing better, Commonwealth summit to improve economy, upcoming Singapore road show, huge foreign inflows, investor friendly SEC.
I would stay away from three sectors: banking, plantation and automobile sector for the time being: such shares are good long term buys but not short term.
There are some shares that may do well but are based on speculation. I prefer buying shares based on fundamentals.
So what is the best share to buy and hold if we are to invest based on fundamentals and future earnings potential?
My opinion is..... KAPI (MTD Walkers)Recent performance:
97% YOY increase in profit Fundamentals:
KAPI is currently trading at a PE of 5.5x & PBV of 0.7x which are significantly below the sector PE of 8.6x and PBV of 1.4x. Technicals:
shows an upward trendFuture growth potential:
KAPI has moved into ship building, power generation (supplying Jaffna) and their order books are full in the construction sector (which is set to boom)
The company will also have to increase its public float which means that it will be more liquid. Turnover of KAPI has anyway been healthy during the last 6 months.
Current Price: 32
Target Price for 3 month period: 40
Target price for 6 year period: 45
Target price for 1 year period: 50
I would also like to quote a post made by hariesha who has made a good observation: "KAPI is currently trading at a considerable discount to AEL when comparing both PE and PBV. AT PE terms KAPI should increase to Rs.40/- to match with AEL and in PBV terms should reach 58/- to catch up AEL"
Construction sector is one of the best sectors to invest into and KAPI is the best in terms of ratios. AEL is also good but KAPI is a lot cheaper.
I also think TJL is a good investment. One of the best shares available. Garment industry is set to do well.
TKYO, SHL are also good investments which will give a return over 1 year. LIOC is also a brilliant share. I can see SHL reaching 16 but it will take 2 years (100% return)
Always have a look at the latest quarterly reports before making any decision.
Keep away from shares like CIFL, PCH - they may burn your fingers - only get into fundamentally strong shares - dont be impatient and dont do margin trading. If you are serious about trading, learn a bit about the market - I would recommend following some courses available at the SEC. Never blindly follow what people say and invest your hard-earned money: not even what I say.
This is not a recommendation: just stating my opinion.