Shriram Transport - ST gains are higher than LT profits

Shriram Transport share price had risen by 33% in last 1 month. Post its good Q3 numbers, share rose by 16%, by over Rs. 180, on last Friday, and yesterday by Rs. 100, with share hitting high of Rs.1,476 yesterday, against its earlier 52 week high of Rs. 1,340 seen on 24th Feb 2020. Many investors have a belief that LT investor can make more money (due to greed and bias seen for a rising stock) which is not universal and true. Many Fund Managers also propagate this theory (due to lethargy or lack of new ideas). Shriram transport is such a case, where we have always advised to go for profit booking.

We gave buy call on the stock, 8 time since November 2020 month, starting from Rs. 693 to Rs. 1,111 on 29th January 2021. Share rose from Rs. 1,046 on 31-12-20 to Rs. 1,470 yesterday, a rise of Rs. 424. But if we reduce this time span by 4 days to 28-1-21, it gave a rise of Rs. 65 only. Stock was recommended at Rs. 962 on 24th Dec in MTI section, having risen by 53% in less than 6 weeks, which shows its tendency of being a high beta. Stock was also recommended by us in member Zone BG Section, at Rs. 1,219 on 15th Jan, Rs. 1,197 on 7th Jan, Rs. 1,114 on 6th Jan, Rs. 1070 on 4th Jan, Rs. 1,029 on 25th Nov, Rs. 974 on 24th Nov, Rs. 934 on 23rd Nov, Rs. 912 on 20th Nov, Rs. 925 on 19th Nov, Rs. 872 on 17th Nov, Rs. 762 on 4th Nov, Rs. 693 on 2nd Nov (8 times in Nov) with all targets met.

Hence, one must not get married to its stocks held, as we are not promoter of the company, or should not get greedy with rising stock, and get fearful in case of fall, if our investment theme holds good. Shriram Transport is just one example in this regard, while many of such instances can be seen with our other calls given in LG & BG Sections in last 12 months.So, in nutshell, go for profit booking at some levels, (while it may be now for Shriram transport) while take fundamental call on buying and profit bookingon any stock.