Investment Journey

Explore the journey of a seasoned investor through different phases, from initial mistakes to valuable reflections, leading to a distinctive investment approach focused on risk and growth opportunities. Discover the emotional and strategic evolution that shaped a successful investment journey.

• Investing
• Journey
• Reflections
• Learnings
• Strategies

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Uploaded on Mar 02, 2025 | 0 Views

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Presentation Transcript

1. Investment Journey

2. Dream Phase (2006-2009) Mistaking Luck with Skill Managed to capture both upside 2006-2007 and downside 2008 Made good amount of money then Couldn t differentiate between greed and confidence ..

3. Tough Phase (2010-2013) Losses and repaying the same Losses started with big levered bet on single stock (which had client concentration risk) Options bet goes sour with lack of volatility Losses accumulate .Fear was now dominating as an emotion Repayment of the losses was tough . Timely help .and time for reflection

4. Reflection and Learning Trading is difficult because it constantly seek you to work against basic human nature .Investment is far more forgiving and kind Trading was not worth for the kind of risk and stress taken In context of Investments...it wasn t time-bound and relatively peaceful Even during tough period 2011-2013 .there were several stocks which did well

5. Investment Journey Begins.(2013) Lucky to start at the right time .2013 end Personality Traits High Focus on Risk Concentrated Bets. Top 4-5 stocks would account for 60-70% of PF. So far haven t held more than 15 stocks at any given point in time. Typically look for very high Risk-Reward (3-1) - We tend to under-estimate risk and over- estimate returns. Risk profile has to be really convincing to go outside above. Don t mind taking big bets on high conviction. Love market as there are no set rules to make money Non Linear correlation between Stock price and Underlying business makes it extremely interesting.

6. Most Excited By Love identifying not so known names, though holding them could be emotionally uncomfortable Growth Companies Clean balance sheet with growth visibility, while downside protection from historical numbers/data. Basically Ideas with optionality. Capex undertaken without diluting balance sheet quality. Add to that incremental growth without stretching WC cycle. (Lactose India, Dai-Ichi Karkaria Ltd, Dynemic Products, Innovative Tech Pack)

7. Most Excited By Stressed Assets Market pricing in worst, while getting clarity on delta in terms of improving leverage, profitability, improving WC, ramp up in capacity utilization ,etc (Steelcast, IMFA, Kamat Hotels, Sugar Stocks) Sheer Undervaluation Getting rough sense on asset value. However management quality becomes key for it to become monetizable. (Pudumjee Pulp)

8. Ignorables/Not Ignorables Ignorables Stretching Balance Sheet for Asset Building (Steelcast, Stylam) Steelcast Cyclical upturn will take care of leverage. Stylam Strong sector tailwind takes care of relatively higher debt Diworsification If not material &/or acknowledged by management. Stylam (BPO Venture) Management Meeting Non Ignorables Frequent Dillutions Stretched Working Capital Growth Without Cashflow Generation

9. Mistakes Omission Binny Ltd Avoided purely on related party transaction, missing big gap between asset value and market cap. Commission Gujarat NRE Coke Tried playing like IMFA ignoring key variables like owned mines, low promoter holding (largely pledged), promoters checkered past, etc Learning Greed overtook rationality given the way IMFA moved post my selling (sold @ 2x went 5x).

10. When to Sell Realize that very small number of small/micro caps will go beyond Rs 5bn market cap sustainably. Hence, start booking partly once known variable in terms of growth, expected valuation starts getting priced in. Sell in staggered manner. Allow part of the holding to ride the growth momentum. Haven t spend enough time in investing to experience riding big compounders. Have mostly repented selling Since markets have been way too kind to small/micro caps.

11. Thanks