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You are a well-known investor. You have a lot of multi-bagger stocks. Of course, there were obstacles along the way. But what do you pay attention to first? You know, we young people pay attention to P/E , EV/EBITDA. Someone is talking about growth, about ROC. What is most important to you among all these indicators?
For me, it's actually a very important concept. Forget about net profit, forget about revenue. What is the company's growth? Concept and development—that's what's really important. Of course. So for me, the most important factor when choosing an investment is the company's growth. Will demand for the product persist over time and how quickly the company can grow.
This is more important. I've been looking at some of your assets, particularly Everest Industries, recently . What would you call it? "Bottom up" or "top down"? Actually, I would say it's a combination of both approaches. Good. There are almost no public companies in this industry. Only four , it seems, or five companies are listed on the stock exchange.
Mhm. And I think stocks... I think I could be wrong... They're cheap too. Of course. And it's a combination of both approaches, as you asked. Okay, I understand. So, Everest Industries is a stock in which Mr. Kedia increased his stake to about 5%. Another important point I wanted to ask about : in recent years, the leaders of the sector have not been attracting much attention.
You're looking at maybe the third or fourth player in the market. An example is Cera Sanitaryware or perhaps even Atul Auto. They weren't sector leaders, but they became big multi-baggers for you. Tell us about the investment thesis regarding them. In fact, everything was very simple. When I was buying all these stocks that you just mentioned, both Atul Auto and Cera Sanitaryware, the biggest advantage in my favor was that the market was very bad as we had just come out of the "coma" after the Ketan Parekh scandal.
So the shares were sold very cheaply, for next to nothing. All of these stocks were available at P/Es of around five or six and with dividend yields of around five, six or seven percent. In addition, the economy also began to recover. And the same thing happened with all these companies. They also began to recover.
So, I got this advantage . That's why they all became "multi-baggers." OK. Good. You know, Mr. Kedia, another area that everyone is talking about is the chemical industry. She has been attracting a lot of attention over the past couple of years. I understand that you have done a lot of field research.
You visited China. You saw how this industry developed there. And then you backed Sudarshan Chemicals, which, by the way, I think has grown 10 times since the purchase. Tell us how this happens? How important is field research? Of course, this is very important, because if your stakes are high, then your research should be just as thorough.
At that time, I was in China for a different reason, for a different project. Then I happened to meet someone from the chemical industry. And I realized that China was losing ground in the pigments sector and the chemical industry in general. I remember visiting Beijing at the time and seeing the pollution and so on.
This was a little preparatory work that I did. But the only reason I settled on Sudarshan Chemical is because I have been following this company for many years, maybe the last 15-20 years. I bought my first shares in 1992 or 1993 in a very small amount. And I kept them until 2014. And when I discovered that structural changes were taking place in this pigment industry , I bought Sudarshan Chemicals.
What about the chemical industry as a whole? Is there still potential left? Of course, I believe that in specialty chemicals, not mass goods or pigments, India is actually ahead of China. Okay, so you're still positive about the chemical sector, I understand. Specifically, the specialty chemicals sector.
Note that Mr. Kedia is optimistic about the specialty chemicals market. Another area was the automotive industry. We have already talked about Atul Auto, but it is known that you have a large stake in ABC Bearings, which is also awaiting corporate action with Timken. How optimistic are you about this?
The automotive market is recovering. The industrial sector also looks pretty good. What is your opinion on the bearing industry in general? Several public companies in India, maybe five or six players. And ABC, when I bought it, it was cheap. So now it's no longer a cheap stock because it's merging with Timken, so they'll get the Timken valuation.
So, looking at the overall scenario now, as people are saying that the average capacity in India is above 75%. Therefore, we believe that private capital spending will start to increase in the future. All this will create good demand for the bearing industry and Timken, being a global leader in this field, will definitely bring all these technologies to India.
So this company will definitely win too. This is not a recommendation at all. The promotion is very expensive. Yes. So it's just a discussion. Okay, but a positive outlook for the bearing industry . Yes. So now that it becomes a Timken company, the Timken valuation will be received. So, the specialty chemicals segment looks quite interesting.
Even our bearing sector looks quite interesting. Well, in recent days, Mr. Kediya, I have noticed that there is a lot of discussion in India about gambling. I want to know if Mr. Kediya ...are you a gambler ? And what is your opinion on this sector as a whole? I'm actually a big gambler. Not a small player.
I go to the casino and play. My wife also likes to play. Ugh. So we set a limit: when I lose $100 or $200, that's my upper limit. Mhm. That's why I call myself a big player. Mhm. Regarding gambling, I remember one thing: the government is currently considering legalizing gambling in India. Mhm. In my opinion, the government has already legalized gambling, and what people do by trading futures and options, Ugh.
this is also just a game of chance . Good. So what... Mhm. gamble? Gambling is like something where you take risks. Right. Okay, without any qualifications, without any experience, you do something to make money, Mhm. without any logic. So, it's a risk, it's a gamble. But many of those investors who came there were suddenly hurt.
What mistakes do they make? What advice would you like to give to some of these investors coming in there? Maybe you have a few topics you have in mind that you could explain to them. I'll tell you one thing, the acronym—KEEP. Good. How can you AVOID market failures? And this especially applies to beginners and everyone else.
We can't teach or interact with, you know, market veterans. Of course, beginners should remember the word KEEP . Mhm. And in the word KEEP, the letter E stands for "easy." Yes. So everyone who comes to the market feels that it is very easy to make money here . Mhm. They don't need any education. They don't need to learn anything, and experience is also not required.
All you need to do is graduate from college or university and you can make money. Mhm. But this is not an easy business, understand? It's a simple business, but not an easy one. That's why I chose the word KEEP. What does this abbreviation mean? I mean, could you explain it to us? Yes, in KEEP the letter E stands for "easy".
This is not an easy business. Of course. And the letter C stands for " Crorepati"—millionaire. Most people want to become millionaires as quickly as possible . They want to become millionaires overnight, and therefore make all the other mistakes. This is why they fail in the market. Mhm. And another letter in the word is A.
So, your approach to the market is wrong. Your approach to the market is like a gamble, you know. And the market rewards you according to your perception. If you consider it a game, then it will be a game for you . And the last letter in the word is P. P stands for " penny stock"—cheap stocks. There are two reasons why people fail in this market.
These are the main reasons. One of them is that they are passionate about trading. Your approach is a gamble, and another reason is your love of cheap stocks. You see, most of the capital in this market was destroyed by these two segments: futures and options and cheap stocks. So, if you can avoid this "KEEP", then of course I don't know if you will make money or not.
But you definitely won't fail in the market. You won't leave the market and then say it was a massacre. So be careful: if you don't have the proper knowledge, you are telling our audience, "Be vigilant." If you want to work with futures and options, you must have the appropriate qualifications. And as for cash stocks, well, they look cheap, but be very, very careful, because that's where you can get scammed the most .
What about the investment business? Back in 2017, it was pure bliss. Lately, I've suddenly come across so many investors who say, "Oh my God, why did we invest our money?" Many of them are investing for the first time, and I fear, sir, that they may not return to the market for the next few years. What do you think about this?
Yes, of course, because the approach to the market is wrong. No, they never... ask anyone who came to this market, have they actually taken any courses? What experience do they have? Have they been through ...if you want to become a doctor, what kind of experience do they have? Did they pass...if you want to become a doctor, you study to be a medic for 5 years or to be a lawyer for 5 years.
Yes. What housework do you do? What economic qualifications do you need to have to enter the market? None. That's why I've said many times that, you see, investing is a blessed business. Yes. OK. In my opinion, this is a sacred business. Mm. I remember reading a poem as a child: "I am the master of everything I look at." "And no one denies my right." Ahem.
And that means that in reality I own everything, but I own nothing. OK. So, this is what investing really gives us, this is the freedom it gives us. That I am free and not obligated to anything . Right. And plus, what advantage do you have over promoters: suppose tomorrow a promoter sees that his company will not perform well, perhaps within the next year or two.
He cannot sell his shares. Mm. But you don't carry any burden. You can sell his shares tomorrow and invest the money in another company. Truth. So it's a blessed business. Yes. As long as you don't abuse it. You say: if you don't like the company and you think the prospects are not very good, you have no obligations, no burden, you can sell the shares.
What about the small and medium-sized business sector? You know, there was so much momentum, so much talk about it . Suddenly people are scared, but I was looking at some stocks, and actually, you know, in some companies you increased your stake. So, overall, I wanted to know your thoughts on the SME segment, if you could explain it to all our investors.
This should have been a good opportunity. There has been a lot of fear lately. I'll tell you, I personally don't make a difference whether it's a small-cap, mid- cap, SME, or mainstream platform, it doesn't matter to me. Yes. If I like a company , I buy on any platform. If I don't like it, I can sell any shares tomorrow.
Last year, I was very optimistic about Karnataka Bank. At one point I owned 2%, as you know. But for some reason I felt uncomfortable, because peace is very important to me . Mhm. Peace of mind is more important than making money in the market. Truth. So I was dissatisfied with the company's results.
So I sold my Karnataka Bank. I also reduced my position in Aries Agro and switched, for example , to Everest Industries. I increased my position because I thought it might perform better than these companies. So, in the end, my money is still in the market. People think they are playing T20. They come and want to make money immediately.
But that's not true . No, of course not. Then you will get burned. This is impossible. So you have to be careful because of liquidity. Certainly. You know, Mr. Kediya, I've noticed in the past: this market will either make you a lot of money or teach you a lesson you'll never forget if you make a mistake.
You mentioned that one of the stocks that may not have paid off is Karnataka Bank. You were quite optimistic, and you actually came out of it. But for the market as a whole, what is the biggest risk? People are talking about us entering an election year. You know, oil prices have also risen. In your opinion, what is the biggest risk for our market right now?
I don't know what risk is. Risk is something that can be assessed. If you know it's a risk, it's not a risk anymore. Good. If you say that the Modi government or oil prices are risks, then I do not consider it a risk to the market, because all these risks are leveled out over time. If suddenly something happens, then the situation will be different.
Of course, I'm not saying that the stock market as a whole is a safe bet. What about political risks? How big of a risk is this? I will give you one simple example. I don't know whether the Modi government will come or someone else. In fact, this country has been run by Congress for a long time; It seems like since we gained independence, Congress has been in power most of the time.
Of course. India has achieved everything it has now and people say that whatever policy this government has implemented was laid down by the previous government. Of course. So Congress is also a tried and tested government. Good. BJP is actually doing some good too . So I don't care. We have seen so many prime ministers.
We have seen Mr. Deve Gowda as Prime Minister and many other people from different parties. I think even under the Deve Gowda government, the markets were quite stable. That's what I'm talking about. The market is actually adapting to all of this. So I don't have the answers to these questions. I'm not worried.
For me, these are not short-term things. For me, it's like that song: here to live, here to die, and where else to go. We know the investor Vijay Kedia. What about entrepreneur Vijay Kedia? I remember you once said about a good manager in a bad business. That he is better than a bad manager in a good business.
Certainly. So tell us about entrepreneur Vijay Kedia. No, no. I am a failed entrepreneur. I'm not a good entrepreneur at all. My mind works differently. Still? Still. For now. Currently, you only manage your own money. Would you consider going into the market and managing other people's money? Is this possible?
No, I don't know, because I don't want to be accountable to anyone but the tax office. I don't know, I don't want to be accountable to anyone, unless someone gives me $5 billion. $5 billion, and then you would consider it? But for now, you're happy with what you're doing. I am happy with what I do. What about Vijay Kedia's life mantra?
The mantra is very simple. There must be a market. I will tell you everything you have learned in your life. Okay, actually, everything you've learned, you have to analyze. Yes. You must implement. Yes. And you have to repeat. Yes. Okay, like in cricket, once you find the right position M-um. you are in your comfort zone, so don't try to change, don't try to constantly seek adventure.
Stick to your comfort zone and keep repeating the process. But don't stop learning. Certainly. Keep learning at the same time, because if the situation changes, if the weather changes, if the venue changes , then you have to change yourself. Yes. So there must be the ability to adapt. Certainly. Otherwise, if you are on the right track, keep doing the same.
So we have markets, we have meditation, and uh, what else? Music? Music, yes. So, these are the three "Ms" that you are, your life mantras, if I may say so. Yes, and the fourth is my wife's name, Manju. Wow, wow. Fantasy. You are simply outdoing yourself now, sir. Certainly. So, we caught you off guard a bit, but could you sing a few lines of the same song?
And you could tell us about its meaning as well. And there is also a message for market participants. Uh, the song sounds like this. It was great, and what we realized is that you talk about buying good companies, look at the promoters, buy and forget about them. You definitely get the message across to our audience.
Share some details with us. What was your train of thought when you sang this song? And what message are you trying to convey? Actually, I was flying from Bombay to Bangalore. OK. So suddenly, on the plane, it occurred to me, while I was sitting there, why not create a song for the stock market. The stock market, of course.
So, the message is very clear: invest for the long term. M-hm. And management is a very important part. Management is like the driver of your...it's like the captain of your flight. Yes. Okay, if he makes any mistakes, you'll go to the bottom. One of my quotes: What you look for in a leader is that they should be truly honest, hungry for success, and intelligent.
Certainly. And in the past, I remember you were telling us about how to get on a plane and enjoy the flight, if I understood correctly, right? Enjoy the flight. Once you're sitting there, you can't do anything. Yes, there's nothing much you can do. If you're flying from here to London, what else can you do after an hour of flying?
You are completely dependent on the flight captain. Then you just relax, drink your wine, tea or green tea and enjoy life. That's right. So, you told us about the mistakes. I mean, you know, some of those investments didn't pay off. You mentioned Aries Agro, you also talked about Karnataka Bank. But once you make a mistake, make sure you don't make it again.
Yes, of course you are learning, right? We learn with age. We learn from our As you said too, right? Which, you see, when we make money, we make a profit. Yes. When we lose money, we learn. Of course. So, when you're in the process of making money, at that time you think that So, whatever you're doing, you're doing it right.
Right. So you don't learn from your winning cases and stuff, right? So that's something I'm learning too. I have this quote: buy like a bull, sit like a bear, and watch like an eagle. This is the only job I have left—to monitor all my companies, how they are doing, and to constantly make changes. OK.
So, even though the horizon is to hold them for 10 or 15 years, that doesn't mean I can't sell my shares tomorrow. If I like something but it doesn't go as I planned and I'm really stressed, then I'll close that position immediately. Certainly. And I'm not ashamed of it. Oh, on that note, Mr. Kedia, thank you very much for coming to our studio. It was nice talking to you.
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