Is Amtek Auto’s Share Worth Investing?

The short and immediate answer is a big NOOOOOO!

It is not safe to invest in Amtek Auto. 

Unfortunately the already bad condition is rapidly deteriorating.

The losses are mounting and key profit and loss account related ratios are falling.

All the key balance sheet ratios like current, quick and TOL/ TNW ratios are declining.

Even the market conditions are not favourable.

Amtek Auto Market Snapshot:

The EPS and PE Ratio are negative, indicating losses. Dividend yield is zero. Price to book ratio is tempting at 0.17 (discount of 83%) but still please do not fall for it.

The share price is in doldrums. After a brief rally in 2014–16 where the price touched about Rs.215, it is languishing at the bottom at Rs.37. Amtek Auto stock’s five year price graph below vindicates my stand:

In conclusion Amtek Auto's share is not a good investment option, so please do not invest.

Stocks Worth Keeping Forever

Actual Question:

Which Indian stocks would you keep in your portfolio forever, starting from April 2017?

Answer:

Dear Friend

A very interesting and valuable question.

My guru, Warren Buffett repeats again and again that buying stocks is like buying the entire business. You don’t start and sell your own business with every movement in the price of the stock on the stock market. He also says that if a stock is not worth keeping for the lifetime, it should not have been bought in the first place.

Now let us address your question.

All the stocks listed in my academic portfolio, ‘Portfolio 2K15’ , except NTPC and SBI, are very good and worth keeping. Kindly note that for the past two years since starting this portfolio in February 2015, I have not sold a single share. However, my real darlings are:

1. NMDC Ltd.
2. Hindustan Zinc Ltd.
3. SJVN Ltd.
4. Rural Electrification Corporation (REC) Ltd.
5. Power Finance Corporation (PFC) Ltd.
6. Great Eastern Shipping Co. Ltd.

I think I will keep these stocks forever, unless something fundamentally alters the situation like change in ownership/ management, M&A , etc.

Related:

• Hold Outstanding Stocks Forever
• Buy Stocks to Hold for Very Long

In conclusion every stock in which we have made an investment should be worth keeping forever, but out of the 15 odd stocks of our Portfolio 2K15, six are certainly my darlings and they are worth keeping forever.

Thank you,

With Best Regards,

Anand