It is that time of the year, where we not only need to be grateful for all the good that happened, but also hold a mirror to ourselves to see where we can be better. It is no different for us at bl.portfolio. Here, we take this annual ritual very seriously as we are in the business of giving ideas for your hard-earned money. In the world of investing, no one can predict the markets with certainty but what we can do is prefer prudence over popularity and rationalism over exuberance. That has always been our credo and in the same spirit, we curated our product every week this year. Here is an honest report card of all we did 2024:  

Caution on equities helps  

Caution has been the watchword in our approach to and writings on the equity markets in 2024. On the back of the nearly 20 per cent rally in the markets in 2023, our equity outlook for 2024, published on January 7 , set the tone saying that while there was no case for pessimism, there was ample case for caution this year.

Our stance emanated from the market valuation at the beginning of the year (23.8 times trailing) being above long-term averages as well as heightened optimism on earnings growth. In this firm belief, even as the markets raced to their all-time highs well into the year until end-September, we gave more hold/sell/book profit calls on stocks (44) as against buy/accumulate (31). Looking back, we stand vindicated, with the markets now 10 per cent below the September peak and India Inc faced with a consumption slowdown, a slow pick-up in private capex as well as a cooling off in earnings growth.

In our assessment period for our stock calls (July 2023 to June 2024), we gave 117 calls across the primary (42) and secondary markets (75). About one-third of the sell /book profits/avoid calls have worked for us, prominent among them being the calls on telecom and IT players such as Vodafone Idea, Indus Towers, Tata Communications and Birlasoft. With Nifty IT up 23 per cent this year on the back of last year’s 22 per cent, book profit calls on stocks such as HCL Tech haven’t worked well. But we continue to remain watchful on IT stocks, as we believe the rally has been driven by valuation multiple expansion rather than earnings growth.

Our book profits call on PSUs such as Power Grid and NHPC worked well too, but calls to take money out on IRFC, RVNL and Mazagon Dock, though backed by sound fundamental arguments, were given a bit early, in hindsight. These stocks have eventually seen corrections since the September market peak. Reiterating our cautious views on overvalued PSUs especially in the defence space, we highlighted the significant risks in holding on to these stocks, despite their growth potential. In our edition dated July 7 , we had noted why the stocks trading at obscene valuations would be unable to ‘avert a painful retreat when market cycle attacks with a vengeance.’ It was near-perfect timing given the significant fall in defence stocks since then. Our article on the underlying factors driving the PSU rally published on May 11, 2024, is one of the top-read articles this year from the bl.portfolio section on our website.

That said, half of our well-researched ‘buys’ this year (six in 11 calls) have outperformed the bellwether and the broader markets. These include value-picks NCC, KNR Constructions and UTI AMC, international pick Alphabet as well as Godrej Agrovet and Motilal Oswal Financial Services. In-house expertise on international investing is our USP, but we do admit we have been very choosy this year due to our conservative stance. Apart from the call on Alphabet mentioned above, we recommended a partial book profit on Meta Platforms in February 2024. Investors would have made 5x returns from our earlier buy recommendation in our November 2022 edition in a 14-month timeframe on this stock.

This year, we also consciously covered special situations such as buyback, open offers, buyouts etc. to give more actionable ideas to investors on their existing shareholdings. The call to tender the shares at ₹10,000 in the Bajaj Auto buyback citing the massive rally and the valuation expansion has worked well, with the shares now trading 11 per cent below. Ditto with the ‘subscribe’ recommendation to the Grasim Rights issue, which has paid off.

On the other hand, we found that we did not see much success with ‘accumulate’ and ‘hold’ calls. Only six of our 20 ‘accumulate’ calls (Nippon AMC, Caplin Point Labs being examples) provided opportunities to accumulate on dips. We also found that the 15 ‘hold’ calls (expected to perform inline with the markets) didn’t work for us. But it is better to err on the side of caution.

Making the most of yields

On the fixed income side, at the beginning of the year , we were very clear that while rate cuts may or may not happen in India in 2024, interest rates have peaked and that investors should make the best of the rates available. We found both the short-end and the long-end of the yield curve attractive and recommended bonds/mutual funds at these ends. Fast forward to end-2024 and 10-year G-Sec yields have dropped to 6.79 per cent from 7.21 per cent a year ago and a similar pattern can be seen across maturities. Investors have thus benefitted from a rally in bond prices this year.

Keeping in tune with our cautious stance on equities as well as the expectation of a peaking out of interest rates, we carefully showcased options in categories such as balanced advantage, equity savings, multi-asset, ultra short-term as well as gilt/long-duration funds in our weekly ‘Fund Call’ space in the mutual fund section.

For the risk-averse investors, we also recommended safer FD options across tenures from banks and NBFCs whenever attractive options came up.

Gold, rupee view validated

If you bet on gold as a diversifier this year, you would not be disappointed. Post gold’s decent 13 per cent upside in 2023 to end at $2,063 an ounce, we had predicted it to touch $2,200 this year (technical analysis) in our annual outlook published on January 14. We further followed it up with a more bullish case for gold in our article ‘Goldilocks moment for gold’, published on March 17 , as it neared $2,200 in early March. At that point, expectations of US Fed rate cut amidst some uncertainty on whether inflation battle was actually won or not, geopolitical turmoil in West Asia, Russia-Ukraine war and high government debt and fiscal deficit levels in developed countries, made the case for gold too good to ignore. Gold went on to hit a high of $2,790 in October this year. Although it has cooled off marginally from those levels, investors who had taken a cue from our writing would have been solidly rewarded. Rupee depreciation, too, has added to gains for investors in gold in India, offsetting some of the impact of customs duty cut in the July Budget.

Reader connect initiatives

While we have been receiving your feedback regularly through mail or social media, 2024 has been a landmark year for brand bl.portfolio in terms of making an on-ground connection with readers/investors. Towards this, the first of the ‘bl.portfolio Investor Conclave’ was held in Coimbatore in June with a presentation followed by a panel discussion with various experts on the topic of retirement planning. This event was extremely well-received and enabled us to understand the mindset of our audience. There is a plan to do more such events especially in tier-2 cities in the coming year.

With bl.portfolio being entirely behind paywall on our website, online subscribers are a lifeline. To reach out to them, we initiated subscriber-exclusive webinars this year. We have so far done one on US investing and another on the market outlook for 2025 is being planned soon.

Our in-house technical analysis has a great following and to add value to these readers, we commenced our YouTube Shorts video series for the ‘Today’s Pick’ column (BL Today’s Pick: Stocks to Buy or Sell) this year. Our Nifty Prediction Weekly Video series, which has a big fan base, crossed a milestone of 100 episodes in March this year with 139 having been completed so far.

This year, we also experimented with guest stories written by readers based on their personal investing experience. SEBI’s report on F&O trading put out in late September gave us this opportunity. Reader response to our call was overwhelming and at the same time, heart wrenching as well. We carried a few stories with their permission to help the larger investor community take away important lessons.

New beginnings

As the New Year dawns, bl.portfolio will see new leadership at the helm. I step down after what has perhaps been the best four-and-a-half years both for the product as well as for me, professionally. The structural changes and demands that the pandemic brought about has seen team bl.portfolio grow from strength to strength in this period and am glad that I have been able to do my bit.

The show will go on and if you are looking for best parking places for your money, fresh and unbiased perspectives await you in 2025 too, at bl.portfolio.

Keep reading us in print or online, tuning into our podcasts and watching our videos. Do share your valuable feedback too.

Happy New Year!