Is Real estate poised for big gains? 🧵

One of the best way to judge attractiveness of real estate market is to look at gap between rental yield and home loan rate.
In 2004 which was beginning of massive boom the gap was as low as 4% and you could get fixed rate HL at 7%.

1/3 Real estate market peaked in 2013 when the gap became was as high as 7%(HL at 9% & rental yields sub 2 %). This number had gone down to 4% again in 2020 when rental yields were 3% & HL rate was 7%.
Today this number has gone up again at 6% making the market not so attractive.
2/3

I am old enough to remember Shilpa Medicare was suppose to the Laurus lab of Pharma industry. 7 yrs on the returns are zero.

It was one of the 7 stocks in Motilal Oswal 100 bagger stocks.

We know less about stocks that we would care to admit. I am old enough to remember Mayur uniquoter was suppose to be the best auto ancillary co in India. Its sales were supposed to zoom with massive capex (in 2014/15?)/

Seven and a half years later the returns are zero.

🧵

Off late there is a lot of interest amongst investors in stock markets for investing in stocks. I see a lot of enthusiasm in my social circle about the same.
There is thread about the questions you need to answer before you start investing in stocks. Its for beginners.
1/n Creating & Managing one's stock portfolio comes down to these 4 basic questions

Which stock to buy?
How much to buy what?
When to buy?
When to sell?

2/n

Some stocks in my portfolio have been grinding in a range for past 3 months when overall market is on fire. Zee, NCC, SBI, Hindalco and NTPC.

One way to look at this is that they lack relative strength but 2016 taught me that when a bull market begins not everything moves 1/n in one go. There are waves and waves of sectors. Meaning there are phases were almost all stocks from a sector go up significantly. Eg in 2016 we saw a big wave of rally in NBFCs in Mar-Jun, which was followed by a wave in GST beneficiaries from May to July, 2/n

I believe there's an unwritten rule in our market which goes: Never sell HDFC bank stock if you own it.

But to play a devil's advocate I want to build a bearish case for HDFC Bank. It's not a sell recommendation. I am just saying be watchful. 1/n

https://twitter.com/BloombergQuint/status/1183570620392587265

- As the article suggests its over-valued relative to other large banks in the world.
- It's over-owned. We all know its a consensus top holding for mutual funds. They say market/stock tops out when there is no buyer left to buy. 2/