▶ Full Post Text
It’s been a while since I last invested directly in stocks. Most of my investments so far have been through mutual funds because they were convenient and, frankly, I didn’t feel confident enough to pick individual stocks on my own. I also want to stay away from chasing FOMO-driven opportunities.
The last time I dipped my toes into direct equity investing was around 2021. Back then, I invested in well-known names such as HDFC Bank, RIL, Infosys, Cipla, TCS, Tata Motors, etc. However, those decisions were largely based on suggestions and advice from friends rather than my own conviction or analysis (because I didn't understand, honestly).
This year, I’m trying to change that. I truly want to learn the fundamentals, technicals, and frameworks that should be studied before picking a stock. My investment horizon is long term (atleast 7–12 years). Given the recent market dips, I feel this could be a good opportunity to enter into a few quality stocks for the long run.
I would love to understand how you decide which stocks to buy. Do you follow a specific framework or checklist (metrics like P/E, EPS growth, ROE, debt-to-equity, cash flows) or other qualitative factors? I don’t want to invest based on vibes anymore; I really want to understand what actually works for vallue investors & why a certain stock fits in my apetite.
On a related note, I’ve been looking at 3 stocks that are currently trading well below their all-time highs and appear to be available at reasonable valuations (thanks to Reddit comments in other posts). Their P/E ratios seem attractive compared to industry averages, and both profits and revenues have grown YoY (I checked in Groww and Zerodha). Apart from these factors, what other aspects should I analyze before forming a conviction?
Also, if these do turn out to be fundamentally strong long-term candidates, I’d also appreciate suggestions for other stocks with a similar trajectory that I can study and learn from. Once again, I am not looking for only stock suggestions, but rather the reasoning why it works for you so that I can understand & try to find out why that could work for me.
The 3 stocks I’m currently exploring are:
* **REC Ltd (RECL)**
* **Waaree Renewables (WAAREERTL)**
* **ITC Ltd (ITC)**
It was probably a bit too long post. Thank you so much, in advance, for all your upcoming advices.