You invest in different companies for different reasons.
- For example LLUB, you invest in for dividends. You don't put money for the capital gain (unless in a special situation like COVID crash, you would not see a considerable price hike in companies like LLUB). They pay most of their earnings back as dividend to transfer cash into their mother companies.
- In general, you need to look for trends. If there are lot of manufacturing projects planned in Sri Lanka for the next few years (which is the case), companies like TKYO, AEL, CIND will have good businesses.
- Another trend is LKR depreciation. Companies who earn in USD (DIPD, EXPO, HAYC, HEXP, PLANTATIONS) will benefit from this.
- You need to also check cyclic trends. For example, energy companies, plantations will only perform well in some quarters due to season changes.
- You should also monitor gov policy changes. For example, import ban benefited a lot to the TILE sector, however, the growth will not be sustainable once gov allows imports again.
- Look for diversification in holding companies. Say a certain holding companies has diversified into many trending sectors, then that's a good investment.
After you narrow down few companies based on trends and macro economics, you can look at their fundamentals. Look for past few quarters, how gross profit, net profit, cash flow has changed. Read for any upcoming projects in their pipeline. Don't forget the DY too. If it is a stable company, they should release a fair dividend.
Unless you are a day or swing trader, no need focus too much on Technicals.
Even if you do all these things, CSE is pretty much unpredictable. The reason is we don't have enough retail volume. Volume is largely controlled by few extremely rich people and institutions (like EPF). However, in the long term, these manipulations do not matter so much.