Anniversary Edition!

It’s been three years since I started this blog and it’s time to do a celebrational post. No, not for the blog but for the markets!

So the markets are at a new all time high and are digesting a full bumper majority government at the centre, like most of us are. Personally, it’s going to be a phenomenal result because the kind of infrastructure, both digital and physical has been put in motion in the past ten years must not just be brought to completion but also to fruition. India just can’t suffer another lost decade of appeasement, corruption and lawlessness like the one it had between 2004-14.

So in the past three years, markets have virtually doubled from around 11-12k to almost 23k nifty while a lot of stocks have been sensational multibaggers.

I was fully convinced since four years ago on April 24,2020 that we are in the midst of a multi year mega bull run which will make some of us who dare to dream rich beyond imagination and the same has been beginning to take shape. Every single blog since then has stated that if you bet big on India, you’ll make tons of money and it has been vindicated ever since.

Every bit of dip must be bought, every fall to be celebrated as a discounted buying price and staying invested is the name of the game. Anyone who has remained invested has at least seen his portfolio gone up at least three to four times in the past three years. I’ve said this before, it’s not the percentage gain which matters but the multiple fold wealth which results in a life changing wealth building.

This is a full bloom mature bull run taking its shape where now everyone’s convinced that we are in a bull market. If you read my blogs since 2021, you’ll see that I was talking about the phases of bull run and how crowd psychology tells you as to where are we in the rally.

Post June 4, with the official announcement of return of the current dispensation, you’ll see everyone including the FIIs turning big time positive on Indian markets. The infrastructure story, the defence story is all in the play and people have made tons of money.

Some people ask me why I haven’t bought into any of the DLFs, the HAL, Canara Bank or any other metal mining plays etc. This is the topic I wanted to share with you all today

The end game for all of us in the markets is to get rich. It doesn’t matter how you make a million dollars as long as you make one. Every big investor has made his big money in different stocks. Warren Buffet had American Express and Coke; he never had Google/Meta/Nvidia etc. Jhunjhunwala made his billion dollars in Titan and Crisil; he never had HDFC Bank or Eicher or page. So would you say that they missed the bus? No, right.

So everyone who’s in the markets for over five years ( seven plus for me now) will discover his own trading style, investment philosophy amd it may be extremely different from other equally successful imvestors.

I began my career with the PSUs, the metal mining stocks etc and even though I did make money, I was never comfortable owning anything which made me uneasy- a NALCO can fall twenty percent due to some metal news overnight; an IOC will fall thirty percent a day ( it did in October 2018 when Jaitley announced ₹ 1 , yes just ₹1 subsidy in petrol prices)or a Vedanta can go down twenty percent on a corporate governance matter.

We are in that phase of the market where people have forgotten how these companies languished at decadal lows for years together and those who are jumping over each other to buy Vedanta or third rate real estate players will do well to remember that in the eventual bear market which follows, DLF didn’t cross its 2007 peak until 2024! Yes, 17 years!

So my investment philosophy includes three essential elements

1. Low debt good, zero debt excellent- anyone who doesn’t owe anything to others can’t go bankrupt!

2. Corporate governance must be tried and tested and should only be of the most pristine standards.

3. It must be a positive secular aspiration Indian growth story

So for all the companies I’ve bought and held. TaMo had huge debt concerns but is now on path to be net debt free this year and it’s being shown in results as well. Reliance has debt but has at least three lakh crores in cash so that’s not an issue.

I just don’t want any company who can either go bankrupt due to debt or bad management. And for the love of PSUs, I just am too capitalistic in my approach to believe that they can actually deliver once the frenzy subsides.

My investment thesis is simple- India is getting rich, Indians richer. They’re in love with luxury, better lives- cars and goods combined. They’re also madly in love with the stock markets as essentially we Indians are entrepreneurial people. Plus, the savings are increasingly being channelised to markets and it’s on an irreversible generational shift.

So you buy whatever is the core beneficiary of this trend which will outlast every war, election, World Cup frenzy etc.

This allows me to also have a multi year long term approach which helps calm my nerves when BSE fell 18% that day or when TaMo went down 12% post staggering results. It allows me to hold AMC or an ITC beyond the downetrends and collect dividends as and when due.

PS- BSE recently made a new high of ₹3264 which is pre bonus adjustment ₹9800/-. Please go and read my three year old blogs when I had said that this will be at least worth ₹10000/-. The victory is sweet!

TaMo is on track to produce Assembled in India Range Rovers beginning yesterday and it’s a huge move towards catering to the aspiration of Indians who are now in love with their luxury SUVs. Don’t pay too much attention to the short term price movements, it will at least be a double in three years from now.

So I reiterate what I’ve said ever since- bet big on India, it works!