SANDIP SABHARWAL

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MONTHLY UPDATE APRIL 2022

The month of April was a volatile one for the stock markets where we initially saw the markets rally then sell off strongly before stabilizing at the end of the month. Global Markets continued their corrective move and Indian Markets on an overall basis continued to outperform. The Nifty was down 2.1% for the month while the Midcap Index managed to eke out small gains. Global Bond yields continued to trend up and the US Dollar also continued to rally to reach a multiyear high by the end of the month. In the overall context the Indian Markets remained quite resilient with just relative to the rest of the world where despite the March recovery there were deep cuts. However headwinds remain strong and this year will be a tough one and stock picking will be extremely important.

Inflationary fears continue to linger with Crude prices still hovering near $ 110 per barrel and most other commodities hovering at their high levels. Edible Oils which had already moved up substantially got a further leg up due to the ban of palm oil exports by the biggest exporter Indonesia. Inflation is the biggest bugbear in the entire equity story where historically high inflation has killed bull markets as it leads to monetary tightening beyond levels which can sustain growth followed by a recession and equity market declines.

The results season is on in full flow and we have seen that Technology Sector earnings have been muted as compared to high expectations. Many Midcap IT Companies infact did better than larger companies. Consumer Company results also started with HUL and the margins were surprisingly resilient. Many Cement companies also reported and results were better than expectations on good cost controls. Many banks reported results with the good news being on asset quality where most large banks are now at Net NPA’s below one percent. However the challenge these banks are facing now is on Net Interest Margins which are getting squeezed. Also in this year other income will be lower as bonds are getting sold off and the advantage from lower writeoffs has also peaked out. Automobile company results till now have been surprisingly resilient. Many reopening theme companies are doing quite well.

The good part for equity investors in India is that domestic flows into equities continue to be strong and as such good companies at the right valuations picked up early can make decent money even when overall market valuations are stretched.

As the results season plays out we will see volatility continue. Overall I don’t expect the overall markets to give much returns this year however stock picking will work big time.

In a recovering economy opportunities will always present themselves and we should be ready to capture them as they arise.

ASKSANDIPSABHARWAL.COM PRODUCT PERFORMANCES

The month of April was an exceptionally good month for us across the board. Our long term products did extraordinarily well, trading products did fine with positional trading making huge profits while Only For Traders just balanced out. and power alpha stocks remained subdued as the market remained challenging for short term long side investing. Our outperformance across products helped us build on the gains made during this year and increase the gap with competing products further.

TARGET MIDCAP PORTFOLIO

The TARGET MIDCAP PORTFOLIO had another brilliant month where the portfolio was up 3.57% and is now up 22% from 31st of December as against negative returns for the Midcap Index as well as most Midcap Mutual Funds as well as PMS Products. The portfolio is up a huge 76.6% over a 12 month period as against just 23% for the MIDCAP Index and 20% for an average midcap mutual fund. The performance of this plan has been much beyond my expectations. The portfolio is now up 180% since inception and we hope to continue to do well going forward. Our value with growth strategy is working well.

POWER ALPHA STOCKS

We gave 3 recommendations in Power Alpha Stocks however we could not make money in those while we also did not lose. There is excessive volatility which is impacting long side short term investing. In this situation we extended the subscription period of most of the clients by two months as I did not want to give calls just to fill up the numbers. The high ROI of this product has continued over the last many years and I believe that the current phase is an aberration. Overall profits were over Rs 400000 for the last two calendar years a very high ROI. on a Rs 6-8 Lakhs peak capital and Rs 6 lakhs average capital deployed. Overall opportunities will be good for this product even in the future and we will see to capture them. The near term could still be challenging. This is an ideal product for those who want to keep the capital as it is and book regular profits so as to make reasonably higher returns over fixed deposits/Hybrid Products etc.

TARGET BLUECHIP PORTFOLIO

The Target Bluechip Portfolio had a very good month with the portfolio up 1.84% as against a 2.1% decline for the Nifty. We have a good cash holding in the product driven by a cautious near term outlook. I believe the time to deploy will come earlier than later now over the next few weeks.

The portfolio was up around 3.2% for this year as against a decline of 1.5% for the Nifty thus meeting our full year 5% outperformance target. The aim is to outperform by 5% every year to deliver strong long term returns and I believe we are on track for that. This is an excellent product for those who are looking for steady returns with low volatility. One year returns of the portfolio are 27% much above Nifty returns of 16.7% for the last 12 months.

PLATINUM PLAN

The Platinum Plan is our oldest Long Term Portfolio plan performed strongly in the first quarter AND was steady during the month with the portfolio up 0.65% as against a 2.1% decline for the Nifty. For this year the portfolio is up 6% while Nifty is down 1.5% thus building on outperformance. With this performance the PLATINUM PLAN has beaten all Flexicap and Multicap schemes which are all with negative returns. We have maintained some cash to capture opportunities going forward. The since inception returns are now 473% with a CAGR of returns of over 28%. The portfolio has a good mix of largecaps and smaller midcaps which have good potential over the long run. The portfolio performance should pick up going forward. This portfolio is a mix of Large Caps and Small Caps. This is an ideal medium risk portfolio.

ONLY FOR TRADERS

Only for traders had an unexciting month with an almost flat performance. We were wary so played this month largely with options where we did not make money. Some future trades made small gains and losses and it overall balanced out. This was a subdued month after two strong months. We will get 3-5 very good months in a year 3-5 average months and 3-5 not very good months. The ROI of this product is running very high at this point of time. In my view the payoffs will be very high sometime in the next months when the view plays out right and we can realize full profits.

POSITIONAL TRADING CALLS

Positional Trading Calls restarted its exceptional performance after two subdued months of small losses after a huge series of big profit months. The current month saw good profits of Rs 125000 on two lot trading basis. All the calls worked out during the month. The good thing in trading is that a period of 2-3 months of good performance can make up for a few subdued months which this product has displayed over time. This has been one of our best products in the past. We hope to continue to do well going forward and this is an ideal trading product for those looking for lesser calls with bigger targets in a month.

WINNERS PLAN

Small and smaller sized midcaps started slow last year and built on gains. The same is likely this year. The first two months overall have seen decline in small caps but some of our stocks have done well and came back strongly over the last two weeks. There will be opportunities going forward. We booked one recommendation with strong profits during the month. Many of our recommendations have become multibaggers and we have booked profits in some of them last year. The current year is one where timing entries will be important and that is what we will try to guide new investors to do. We also gave a new recommendation this month. Small caps have a tendency to underperform for long periods of time and then give sudden gains. This is unlikely to change.

UNLOCK GAINS PORTFOLIO

Unlock gains got fully deployed during the month. It is too early to talk of performance as its just been a couple of weeks since that has happened. However all stocks are well placed to outperform over the next two years. Will write more on this product later.

For more details write to us at info@asksandipsabharwal.com . You can also call us up at 7303163931/022-66666931 or visit www.asksandipsabharwal.com