BullishMomentum & Saregama -
On 21st May 2020 at 9:38 AM we recommended this stock to our paid members, on facebook and also on twitter to our followers at the price of 295/- with a stop loss of 250. As of today, Saregama India has made a high of 503/- that is massive 70%+ return for our members in two months only!
The risk in the trade was INR 45/- which was higher than our usual 10% maximum risk. Most members retorted with this being operator stock / illiquid stock and what not. The atmosphere was not so bright anyways due to continued lockdown and increasing pandemic cases in India. The risk of 45/- has given reward of 208/- till now.
After our recommendations the stock kept going down on thin volumes for 7 trading sessions. Since the stock was given on public platforms, we received many messages asking what is to be done in the stock / if one could exit as they did not want to commit to the stop loss as usual and profit was considered to be earned by them as soon as they entered the stock.
Why BullishMomentum did Saregama?
At BullishMomentum, we are constantly scanning for opportunities in terms of sectors and themes. Once the theme is selected, we find the best story within that sector or theme.
Due to ongoing Covid-19 and resultant worldwide lock down, the theme in our mind was online business, online education, online content generation basically any alternative opportunity which could replace the physical businesses.
Saregama India perfectly fit the bill due to its end to end content monetization theme. Huge online content library, podcasts, meant no effect on it's revenues due to lock down in fact the utilization of online content was anticipated to be increased multi fold thus will impact revenues positively.
One thing missed by many was closure of movie theaters for a foreseeable long duration. Which meant increased popularity of streaming platforms like Netflix , Zee and Amazon Prime. As we saw since that day, most movies and contents have had to release on these platforms.
Saregama via its film production vertical Yodlee Films was a proven player to cash on this opportunity and the company has done just that.
Irrespective of our love for stories, businesses, one thing that BullishMomentum never compromises on is technical. All our picks are screened carefully on our proprietary technical parameters before releasing it to our clients and followers.
The above chart of Saregama India shows clearly our entry, reason why we made that decision. Post the fiery run up which we enjoyed, the stock has consolidated for more than two weeks now.
Saregama India has given a fresh breakout on 17th July 2020 and completed the re-test as per the closing today.
We are hoping the stock is ready to make new highs and will continue to do better for short to medium term. The stock has been recommended again to our members for much higher targets as we still see the theme and story relevant at the same time stock is showing good strength on all technical parameters.
Hope you liked our first Multibagger recommendation on this blog.
If you have any query or suggestion related to this post please write to us.
Interesting reads about the company -
For the love of music
Saregama India Ltd., a RP Sanjiv Goenka Group company, is India's oldest music label, youngest film studio and a multi-langauge TV content producer.
In 1902, Saregama released India's first ever studio recorded song. In the years that followed, the company continued to expand its catalogue to become the largest in-perpetuity global owner of both sound recording and publishing copyrights of Indian music across 14 different languages. Steadily, the company expanded its portfolio to include intellectual property rights of over 4000 hours of TV content produced for channels in Hindi, Tamil, Telugu, Kannada, Malayalam and Bengali. Over the last few decades, the company forayed into retailing music through physical and digital mediums such as CDs, iOS & Android based apps and usb based thematic music cards.
Since 2017, Saregama has been making headlines again owing to the launch of two unique initiatives, Saregama Carvaan and Yoodlee Films.
Saregama Carvaan is a portable digital music player with in-built stereo speakers that comes with 5000 evergreen Hindi songs inside. The unique proposition of this product is that even today in the times when digital music consumption is the order of the day, Carvaan attempts to give the the older generation a lean-back, uncomplicated ala70s Vividh Bharti music listening experience. Carvaan is a perfect blend of digital technology a retro form factor. In less than a year, from launch its unprecedented sales have made it Saregama's flagship product.
Yoodlee Films, Saregama's film production venture, believes in the mantra of fearless filmmaking. The films produced under this banner are driven by powerful stories that are realistic, provocative and seldom touched upon in the mainstream space. The films will be made available on a variety of platforms including theatre, satellite and VOD.
Saregama's head office is located in Kolkata, with other offices in Mumbai, Delhi and Chennai. It is listed on the National Stock Exchange of India Limited, BSE Limited and Calcutta Stock Exchange.
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