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Value Investing is an investment idea that Ben Graham and David Dodd began teaching at Columbia Business School in 1928, which involves buying securities that appear under-priced.
Also Read: 5 Mantras of Value Investing
One of the best time to invest in stocks is when the sector or industry is ailing with problems followed by huge pessimism.
This is the time when values can be picked, thus resulting in multi-baggers.
The general public has a tendency to run before those stocks which are in limelight and highly overpriced, thus paying more than its value and ignoring the ones which are out of flavor like real estate stocks.
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Real estate industry is one such area which is under huge pessimism.
Smart investors start accumulating stocks which are currently out of flavor.
I believe there are few hidden gems in real estate market which people are ignoring currently but it has a potential of yielding a phenomenal return in coming 1-3 years.
Example of Real Estate:
So I have tried to analyze the annual report of Zandu Realty, a company belonging to real estate sector so as to shift the focus from overpriced auto’s, IT, pharma etc to real estate.
Zandu Realty limited (formerly Zandu Pharmaceutical works Ltd.) is an international pharmaceutical company in Mumbai, India.
The company was established in 1910 and went public in 1919.
In 2008, Kolkata based Emami had acquired Zandu Pharmaceutical for around Rs 700 crore.
In 2011, the board of Emami decided to merge Emami realty and Emami Infrastructure with Zandu realty, thus bringing all real estate business under one roof.
Zandu realty is a small cap company with a market cap of Rs 113.10 crore and in the last 15 years, it has made a high of Rs 24643.20 in 2008 and low of Rs 789 in 2013.
Before investing in any sector, one should undertake thorough research of the sector as well as the company.
What may work for one investor may not necessarily work for another.