By Melissa KoshyAshish Kacholia is a closely followed investor in the Indian stock market, known for his skill in picking small and midcap winners, and spotting promising opportunities. He was born in 1979 in Mumbai, began his career in Prime Securities and later moved to Edelweiss. He co-founded Hungama Digital with the late Rakesh Jhunjhunwala and now serves as a board member. He started his own company Lucky Securities in 2003.
Kacholia primarily invests in small-cap and a few mid-cap companies – a riskier space where he has shown an uncanny eye for potential multibagger stocks. He publicly holds 50 stocks with a net worth of over Rs. 3,088.5 crore. (You can now invest in a shadow basket based on Ashish Kacholia’s portfolio, available on Starfolio, which is updated and rebalanced as per Trendlyne's superstar portfolios).
Beta Drugs, Safari Industries among top performers in Kacholia’s portfolio
The best-performing companies in Kacholia’s portfolio include Beta Drugs, Safari Industries (India), Carysil, and Shaily Engineering. More recent buys like SG Finserv and Gravita India have also surged.
The share price of Beta Drugs has increased by 1075.9% since adding it to his portfolio in Q4FY19. Kacholia currently owns a 12.5% stake in the pharma company.
Kacholia bought stakes in Safari Industries (India) and Carysil in Q4FY20 and Q3FY16, respectively. The share prices of the textile & apparel and household products companies have risen by 927.7% and 559.3%, respectively, since the purchase. The ace investor booked profits on plastic products company Shaily Engineering (bought in Q3FY16), metals & mining firm Gravita India (bought in Q4FY22), and carbon black maker PCBL (bought in Q4FY21). The prices of these companies rose by 422.9%, 221.4%, and 179% respectively till Q4FY24, since the time of purchase.
Kacholia added ADF Foods, a packaged foods company to his portfolio in Q2FY20, and later reduced his holding in the company in Q4FY24 to below 1%. Its share price has risen by 306.7% since the time of purchase. Xpro India (containers & packaging firm), Vaibhav Global (textiles & apparels firm), SG Finserv (other financial services company) are among other stocks in Kacholia's portfolio where he has booked profits since purchasing them.
Portfolio stocks Best Agrolife, Barbeque Nation, La Opala bleed
While Kacholia’s portfolio features several high-performing stocks, it also includes some underperformers. Best Agrolife (bought in Q2FY23) turned out to be the worst performer, despite being a more recent buy. Another double-digit loser was La Opala (bought in Q3FY22). Kacholia cut his stakes in the agrochemicals and houseware companies to below 1% in Q2FY4, as they started to hurt portfolio holding value. The share prices have fallen by 55% and 23.7% since the time of purchase.
Other underperformers in the pack include restaurants company Barbeque Nation, auto parts maker Universal Autofoundry, houseware firm Stove Kraft, and plastic products company Dhabriya Polywood, which have fallen by 52.1%, 33.9%, 18.7%, and 14.5% respectively since the time of purchase.
Vasa Denticity outperforms its industry, HLE Glascoat underperforms
Several companies in Ashish Kacholia’s portfolio have outperformed their industries over the past year. Top performers include Vasa Denticity, Sky Gold, Sanjivani parenteral, and Basilic Fly, outperforming healthcare supplies, gems & jewellery, pharmaceuticals, and movies & entertainment industries by 283.2%, 195.6%, 158.8%, and 158.3%, respectively over a year.
Other companies outperforming their industries include Brand Concepts, Garware Hi-Tech, Aditya Vision, and Man Industries.
Meanwhile, Virtuoso Optoelectronics, HLE Glasscoat, Knowledge Marine, and Updater Services have significantly underperformed the other electrical equipment, industrial machinery, marine port & services, and commercial services industries by 631.4%, 172%, 158.4%, and 112.5% over the past year.
General industrials, chemicals, textiles, and metals are among Kacholia’s favourite sectors
Ashish Kacholia holds a pretty diversified portfolio. His most preferred sector currently is general industrials with an investment aggregating to Rs 637.5 crore. This is followed by chemicals & petrochemicals, textiles apparels & accessories, and metals & mining, with holdings aggregating to Rs 470.5 crore, Rs 360.6 crore, and Rs 315.7 crore.
Kacholia prefers general industrials, chemicals, textiles sectors
Kacholia’s least preferred sectors are automobiles, media, and hotels, with investments of Rs 18.2 crore, Rs 21.6 crore, and Rs 29 crore, respectively.
Kacholia made multiple additions to his portfolio in FY24
The marquee investor has added several stocks to his portfolio in FY24, with some of his recent buys involving substantial stakes. Key additions include Universal Autofoundry (automobiles & auto components company), Cosmic CRF (metals & mining firm), Dhabriya Polywood (general industrials company), and Vasa Denticity (healthcare equipment maker). Kacholia currently holds 8.3%, 6.5%, 6.4%, and 3.8% stakes respectively in these companies.
New additions to the portfolio in FY24
Other additions to his portfolio include Saakshi Medtech, Krishna Defence, Walchandnagar Industries, and Sanjivani parenteral.
Meanwhile, he reduced stakes in ADF Foods, La Opala, Best Agrolife, and Likhitha Infrastructure to below 1% during the year.
Kacholia prefers companies with good fundamentals
All of Kacholia’s companies that announced Q4FY24 results have recorded profit for the quarter. Among them, 14 companies reported YoY growth in net profit, while four saw a smaller profit compared to the previous year’s quarter. Commercial services provider Updater Services’ profit grew 151.7% YoY to Rs 25.8 crore while its revenue improved 10.5%. Ugro Capital’s, a finance company, profit increased by 132.8% YoY to Rs 32.7 crore. Balu Forge Industries saw a 85.6% YoY growth in profit to 28.3% YoY.
Most Kacholia holdings record revenue growth in Q4FY24
Repro India (publishing company), Ador Welding (industrial goods company) and Ami Organics (Pharma) reported fall in net profit despite a rise a revenue, meanwhile Tanfac Industries (commodity chemicals manufacturer) reported decrease in revenue as well
Among the companies in the portfolio, Garware Hi-Tech Films (packaging company) had the highest basic EPS TTM of Rs 81.2, followed by Best Agrolife (Rs 72.1), Agarwal Industrial Corp (Rs 66.5), Aditya Vision (Rs 59.3) and Tanfac Industries (Rs 52.7).
Garware Hi-Tech, Best Agrolife, Aditya VisionE have high EPS TTM
53.8% of the companies in Kacholia’s portfolio are currently trading in the PE Sell Zone, and only 15.4% stocks are in PE Buy Zone. Companies in the PE Buy Zone include agrochemicals manufacturer Best Agrolife due to its sharp share price decline, and iron and steel products companies Aeroflex Industries and Shankara Building Products.
Many companies from portfolio trade in PE Sell Zone, few in Buy
Meanwhile, the PE of nine stocks are above their respective sectors, like Ami Organics (pharma company), Genesys International (IT consulting and software), and Zaggle Prepaid Ocean Services (IT software products).
How volatile is Kacholia’s portfolio?
Over a year, the beta for 43 stocks in Kacholia’s portfolio has been below 1 (signifying lower volatility) while two are greater than 1. However, only 16 stocks have a beta lesser than 1 for a quarter.
The average beta of the portfolio for a year is 0.5, while it is 1.3 for a quarter. Overall,the annual beta of Ashish Kacholia’s portfolio is lower than that of the benchmark index Nifty 50. We can conclude that Kacholia, despite his preference for smaller companies, may be making safer bets by choosing companies with strong fundamentals and good management. On the valuation side, he currently holds stocks in both the PE Buy and Sell Zones.
Kacholia’s reputation for picking potential multibaggers is a well-earned one. While his particular preference, smallcap and midcap companies, tend to be more volatile and get especially affected by market downturns, Kacholia appears to pick businesses he has high confidence in and holds onto them, rarely panicking during downturns.