Friday, March 26, 2010

Rolex Isn’t Going To Make You Rich

It was incredible to have so many fellow Happionaires correctly detecting the company I spoke about in our last post. Congratulations to all those who guessed it correctly. The company whose stock price went up from Rs. 30 to Rs. 1800 and helped an investment of Rs. 50 lakhs grow into Rs. 30 crores in 9 years is known to every Indian. That is a return of 6000%. I don’t think any Mutual Fund or ULIP would have given such returns.

Millions of people use its products every single day. Every morning when I go to my office, I see it on the wrist of my lift man and you can see it even on the wrist’s of some of India’s richest. It is Titan Industries Limited and it is one of the several companies that have changed the financial futures of its investors.

I have never purchased a Rolex and don’t really know how much it would cost. But assuming instead of buying a Rolex in 2001, you had invested all that money in Titan, imagine the impact it would have had on your financial statement. Even a small investment of Rs. 10 lakhs would be worth over Rs. 6 crores today.

Is it risky putting all your money in a single stock? Yes of course it is. You should invest only what you are willing to lose. But if you are convinced about a particular story, and have enough for your daily needs there is no need to over-diversify. Mukesh Ambani, Anil Ambani, Laxmi Mittal and Bill Gates didn’t diversify did they? Over- diversification is a good thing for those who don’t know what they are investing in.

As an investor, I have seen a lot of new wealth being created thanks to India’s economic growth and the opportunities been given to us. Of course, we can’t take the credit for it because luck and being at the right place at the right time has a lot to do with it. People who criticize India, fail to realize the incredible opportunities that are available to us. What would we have done were we living in a place like sub-Saharan Africa or an aging bankrupt European country?

Many times, I meet people who tell me how India has slums, bad roads and a shortage of infrastructures. All that is true, but that also means there are many more opportunities available. Bad road and poor infrastructures, means huge demand for cement, machinery, technology, power and so many other things. We need to be more positive and optimistic. You can’t be a successful investor, if you area cynic or a critic. You might end up being a book critic or movie critic, but not an investor.

In Mumbai, slums are gradually going and giving way to luxury housing projects. Mills are going and have created incredible wealth for shareholders of companies like Bombay Dyeing that owned mill land. I didn’t have enough money in 2003, to buy property in Lower Parel, where a large part of the mill land was located. However, I was able to buy stocks like Bombay Dyeing, as they owned prime land.

A lot of us wonder what is going to be the next Titan? The truth is that nobody knows for sure. I however am confident that there are at least six to seven companies as of now that have the power to give similar returns over the next decade. Look around you and some of these companies will surely catch your eye.

A few people are skeptical about what I have been saying about the markets, gold and real estate. I will not argue or say anything, but instead will ask you to read the posts written around one year ago at the peak of the crash. At that time a large number of people were critical of making investments of even a single rupee. See how things turned out. Returns in excess of 200%-300% were made in a year by all those who weren’t skeptical.

Have fun and happy investing!

Yogesh Chabria



Anonymous said...

very nice article.... i am still holding gold in gud qty as i am sure gold can give me extremely gud returns in next one years tome frame..... on your word i bought some really interesting picks at amzing prices
GUJNRECOKE @ 23 average price
Huang toys @ 33
Ruchi soya @ 18.50 (almost low)
Lic Hoursing finance @ 350
Axis bank @ 335

but patience level always kick me to sell so i started booking profits at every height. one stock which i bought and not ready to sell is FORTIS HEALTH CARE

rite entry level and hold tight will always pay back in huge returns.

Thanks to you yogesh for showing everyone rite and genuine way to make wealth


Karthik said...

Excellent views. Please let us know sir how can I invest with you.

Amar said...

Hi yogesh,

Can please suggest if we can still accumulate gold or gold might consolidate at current levels.

Just require ur views so i may plan my startergy accordingly

Thanks & Regards

Swapz said...

Hi Yogesh,

I would really appreciate your view on Confidence Petroleum, they are the largest gas cylinder manufacturer and have seem to have good prospects in the long run, however I am skeptical of investing it at the moment considering possible fall in markets due to 2nd dip recession and also on the genuineness of the company.
Look forward to hear from you.

Swapnesh Dave

Anonymous said...

Hi yogesh,

I thought P&G but when i check its 9yr back price is was around Rs. 400+. I tried hard to find out, but fail to recognise TITAN. But good thing happen i found one scrit i..e HUL and bought some. I would like to have ur view on this script. And plz tell me the formule to find such stocks.

Thanks for spreading the knowledge.


sudhir kumar said...

Excellent post and very good way to encourage more people to invest for the long term. Keep up the good work.

DPM said...

Hi Yogesh,
You have been educating us on Indian economy and markets for a long time. Could please educate a bit on the future of Indian rupee v/s USD in the long term(say next 3-5 years).

Whether investing in Urban land is better than Urban real estate?


Unknown said...

Hello Yogesh,

Can you please come up with a book on Balance Sheet/PL statement Analysis? It would be great to analyse the Happionaire way. :)
If you dont have such plans, can you recommend a book that you feel is the best for analyzing balance sheets/Income statements?

Sharath Arun

Anonymous said...

Hi Yogesh,
can you please educate us in details about dollar index and please let us know how is it related to the market

DPM said...

I read an article regarding buying e-gold in Demat format. Could you please tell us whether it is better than gold ETF.I saw this in an article by ET.

It is delivered by The National Spot Exchange.

I also encourage readers to share their view.


Ravi P said...

Hi Yogesh,

Where are you? I think we need regular posts. The blog has been quiet from quite a while now.

Anonymous said...

Sorry for my bad english. Thank you so much for your good post. Your post helped me in my college assignment, If you can provide me more details please email me.

Ramesh Tiwari said...

Yogesh ji,

Really looking forward to read more from you. I eagerly wait to read your blog. I'm assuming you must be busy with some happenings.

I wonder, if you are writing some new book? :-)

harmesh said...

Raviji and Rameshji, I know how it feels to not read anything, but maybe he is gone on vacation, so we should try and be patient.

Unknown said...

Is this silence before the strom

Jagan said...

Where are you Yogeshji....everyone over here is waiting for your next dose of knowledge...Its been a long time!

Sandesh Kamble said...

Here is an article from the leading marathi newspaper LokSatta about artificial real estate boom. I know this is in marathi but still this explains the status of real estate market in India. This is what Yogesh was trying to explain us in his previous posts. The day is not too far now. Please try to get it translated from your friends/colleagues to understand it in better way. I am not sure whether there is similar article in english newspaper.

Jairam said...

Dear Yogesh,

I think your predictions on the correction are coming true. Please update us, as we feel lost without your words of wisdom and guidance.


Rakesh Mehta said...

Chabria ji,

Your words as always are coming true. USA crashed 1000 points and see India. You are a real guiding force and a true Guru. I remember you words, when you said that the best way to be proven right is not to argue, but keep silent till what you say actually becaomes a reality for the entire univerese to see. Wonderfull. Now it is time for you to come back and please share your love and knowedlge with us.

Your devoted member of the Happionaire family .

Paresh said...

Chabria Sir, I apologize for my doubting your skills on the correction. Looking at riots in Greece, Dow faling 1000 points now believe you. Also have more trust for sure in your prediction on Gold. Please come back and show us the right way, so we can make India a greatest nation.

Venkat Annavi said...

Excellent analysis. Things are panning out as you predicted. Thank You very much.

Unknown said...

I have been wondering where have you gone..good that you are back..may be you were away becoz the market was heading north and didnt want to 'argue' with the doubters of your views.. whatever, but I would still love to read your inputs more frequently..even if we may not agree on some points, but still it will increase our knowledge reading your thoughts.


vimla said...

Mr Yogesh Chabria i like your writeup but tell us some names of companies which will give 200% returns! I am waiting for your mail regards

stock analyst said...

Oh.. what an nice article, blogs are still getting a good fame, due to guys like you only. as a stock analyst i will always appreciate your opinion.

Anonymous said...

Your blog keeps getting better and better! Your older articles are not as good as newer ones you have a lot more creativity and originality now. Keep it up!
And according to this article, I totally agree with your opinion, but only this time! :)

Unknown said...

Very good article by Kumaran Seenivasan

aparna said...

nilesh i read ur book Invest in happionaire way, which is bought my bother, i seen it and just started to read. it is really very usefull for a new investor like me. u did a great job and the way u express it in ur way. thanku so much