Building Wealth With Madhu Kela Value Investing Stock Picking And Future Markets

TITLE: Building Wealth with Madhu Kela: Value Investing, Stock Picking, and Future Markets | Money Mindset CHANNEL: Sonia Shenoy DATE: 2025-06-14 URL: https://youtu.be/Uk2c3-w8PL0 ---TRANSCRIPT--- The guest that I have today is none other than Madu Ka of MK Ventures. Bangi is very good. Panki is very good. Let’s call for some. Oh, wow. [Music] No, we need some chutney. Huh? I love it. Meeting Rakkesh Gi was a real turning point in my life. Would you discuss a lot of like ideas with him? all the ideas with him and he was again you know even if it’s something he would not buy but he will adise me right [Music] it is very nice my recommendation whether it was a food or a stop they’re all good so I wanted to know from you that does money bring you happiness it does bring me happiness Yes, but I would agree with you only up till a point of time. But how do we raise our kids in an environment when there is so much excess of everything? How do you raise them? My experience. [Music] You have to raise your children by example. What’s the one top piece of advice that you would want to give every young person who’s trying to stay relevant, make money, build wealth for themselves? The first and the foremost will be you have to truly identify your passion. But I have seen in my life nothing of any significance is achieved by anyone in any field unless you are truly devoted to what you are doing. But I must tell you that I when I look back on a closing mark, when I look back my own journey, trust me, I think I’ve not yet bigger. Hey guys, I’m happy to be a part of Zerodha’s media network. Together, Zerodha and I plan to bring to you simple yet effective and impactful news and views from the best minds in the financial world. Hey guys, welcome to the money mindset. Now today’s a very special episode because it is an episode where we are celebrating 100,000 subscribers on YouTube. So first of all, thank you so much for being a part of this amazing journey and the guest that I have today is none other than Madu Ka of MK Ventures. Madu, thank you so much for being here. It’s an absolute pleasure to have you. I’ve been trying to catch you for very long and finally I have. Thank you Sonia. I am so happy uh for you specifically that uh you have contributed so emotionally to small investors and their journey and wealth creation and now finally you are doing something entrepreneurial and uh I’ve seen some of your work it is absolutely phenomenal. So my best wishes to you and I hope you continue to make a difference to wealth creation journey of a lot of small investors in India. Thank you so much Madu. Thank you and you know it means a lot to me because I do know that your journey has been nothing short of phenomenal right. I mean you started really very small from a small village and today you are one of the top investors in India top wealth creators for yourself individual wealth creators in India and so I don’t know whether I mean top or not but [Laughter] top but very humble also everyone knows that about you but tell us what is the secret because you know 140 cr people in India say there are hardly 10,000 15,000 people who have created wealth for themselves. Yeah. What stops people from creating this big wealth in the stock markets? So I would say first of all uh Sonia this is a very uh I think technical subject right you know it is only looks easy in a mirror view that I should have bought this and I should have sold this right because when you are dealing with money there is a different mindset which is there you know because let’s say you buy some share at 100 rupees and the price goes down in matter of 1 month to 60 or 70 rupees. You know, at that time because you can see the losses in front of your own eyes. To be able to hold and plus to develop this professional expertise to develop real understanding of markets and companies, it requires years. There is a saying in the market that you know that in the marketplace. [Laughter] So it requires like swimming trust me. you don’t learn. So it’s a very tricky subject. It requires a lot of patience. Plus you’re dealing with money and plus there is a real expertise which is really needed because you know there’s no standard formula making money that you buy any company which is above 10p and you sell all the companies which are above 25p. There’s no standard formula like this which which makes money. So also let’s not forget what you are investing into that is also unpredictable. markets are unpredictable and what you are investing into sometime like you invested in something and Donald Trump came and you said that I’ll put tariffs your whole business model temporarily has gone for for a six right so it’s been a it’s not only in India then you know in India there’ll be 10 to 15 but if you look at people who are globally how many people are actually successful correct it’s only a handful even in a country like America you can’t count more than maybe 500 very very successful investor or you know if I talk about you Madu I mean success is it’s a small word right like we talk about success being okay you’ve achieved say 100 crores someone has made 200 crores someone has made it’s relative for everyone money right but in one generation in one lifetime to go from zero to say 2,000 crores 3,000 crores of net worth is exceptional I mean I don’t know how many people can do it honestly and then to be so humble and to give back to society in a big way that you do it’s really remarkable but I want to know secret sauce you know and I wish trust me that I learned about lot of these secret sauce much early in my career as I said all of lot of these comes uh have uh it has come through experience lessons it does not come easy right and again you can read lot of books and all in theory you can say that I’ve learned this from the book but when in practice is different so you know ultimately you have to be a long-term investor there’s no doubt about it you know second your preparedness of work has to be really really good that you know your entire thought process whether it is research or your thesis you know sometime it is not a lot of research also sometime you have a thesis like you know I just give you an example like supposing if you understood the word internet in 2000 then what this is going to do to the world and you had some kind of a visualization there is $25 trillion I repeat $25 trillion of wealth which has God created on that one thing. Whether you talk of Apple, we talk of Google, we talk of Amazon, what is it? Without internet and without fast internet, it would not have been possible to reach out to so many people, right? So sometime your whole thesis that yes, you bettered big on on the thesis and then you continue to do work to strengthen your thesis and you keep listening to the market. See, I can’t operate in isolation. I can’t say okay I have I have uh I have suddenly discovered this thesis and I am ignoring the market market is not responding to my thesis. So what is the value of that thesis the the quality of work which you do the level of conviction which you have and then you have to have a emotional strength. See what happens when you are a investor and you’re watching the market unlike when you put money in insurance unlike you put money in gold or property or bank you don’t go and check every day what has happened you go and go do go how many times have you checked yourself what is the value of your house or your property hardly any time right but unfort fortunately or unfortunately because it is liquid you check the stock prices practically every day even if you don’t want to check someone other will you that this is what has happened right. So to be able to deal with that fluctuation and the volatility and all the noise is that is what really makes it very different difficult. So a the level of research, conviction, the thesis, the market volatility and to top it all that you know the to be able to go through the draw down in your portfolio and still be convinced like if you look at the best companies in India whether you talk of Titan or you talk of DVS in last 20 years you know they they would have corrected maybe 30 40 50% maybe 10 times correct but you know and if your net worth in one company is hundreds and thousands of gross and you see a 30 40% dark draw down you require a very different level of conviction and a mindset both in terms of understanding the company having your own conviction and thesis and having the emotional strength and agility to go through the draw which which is what really particularly makes it very very difficult and that is why you know all the people who really really like invested for longer term and who seen this cycle they have made really a lot of money in this market so Dies is one stock right where you caught it early and you’ve watched it grow just tell us a little bit about that at what price did you buy Disease what was the market cap at that time so you know DI’s market cap was 140 crores when the when the IPO came and some of the smartest people actually company did not raise any money. See this a very unique companies Sonia you know and I think very underappreciated for what they have actually delivered even today I would say in the marketplace look at the history of the company the total money Mr. Midi has raised is only 10 crores. Only 10 crores right till now out of 6 cr he put himself the external money raised was only 4 crores and the IPO was offer for sale. So the people who bought it at 10 rupees they sold it at 140 rupees and some of the smartest investors participated in offer for sale at 140 rupees thinking that their money has gone 14 uh times right in matter of that five seven years but after that that 140 cr has become 1 lakh 40,000 crores or maybe more so if you actually reinvested your dividend whatever you got in div and you have stayed put you would have made maybe 1 1500 times your money 1 cr if you invested it would have become 1500 crores wow so that is the real power of investing it’s not only that there’s only this has happened only in DVS Rakkesh we actually made money in Titan or you know the money you would have made money in VST or so many other companies someone else would have made money in Kot bank or HDMC bank but the the story or thesis is all the same that you bought really an extraordinary opportunity. You bought into extraordinary entrepreneur. You bought into a space which was very large where the external opportunity was very large and you bought big quantity and most importantly you bought it at a price where you had a tremendous margin of safety. I’ll tell you my own story like so a couple of them which I’ve been still been holding. So was one thing which I didn’t as I told you I hope I had all this wisdom when I was very young I didn’t have honestly and I as I speak to you I’m still developing so let’s say for instance radical ketan you know we bought maybe 10% of that company 8 n% of that company when the market cap was only 100 crores today the market capitalization of rad ketan is 35,000 crores wow see I only 100 crores to 35,000 crores but when I liked kind of left left reliance at that time I bought personally radokan shares at 115 odd rupees and it is all disclosed right today that is stock is close to 3,000 rupees 2,800 rupees and I’m still holding part of it right but what was it in the company that so that is what I’m trying to say so what happened what happens you know when you identify these things and you buy cheap. So Radico after I bought it went up from 115 rupees it went to 500 rupees and in covid time again it fell to 220 rupees. So the mood point is if you have bought it at a price where margin of safety is very very highrifice I repeat because I buy it at a price margin of safety is really high at that point of time that you know so 500 But that’s what I’m saying that is what the experiences teaches you and a lot of times we also end up end up selling that you know there’s some something really tragic which happens in the industry or a company or in the market and that is the overall evolving of the now if you ask me I already had a thesis that liquor business will do extraordinarily well because we have a young population you know the per capita income is growing and when we analyzed his company Mai in China that makes like $15 billion profit and the all listed companies put together we’re making merely $500 million profit. Then we dig deeper then why is the case the case is because it’s not a transparent it’s not been a very transparent business in India right take for instance case of UP regulatory regulatory up Sonia the total excise correction was only 12 8,000 crores in 2011 12 in 2017 before the Yogi government came it was 17,000 crores last year it was more than 50,000 crores because they freed up the whole thing and once to free up the whole thing like this is the same thing which has happened in Andhra Pradesh. Now the important thing is I had a thesis the a there is a younger population and this industry will do really well. You know I did not know when UP will open up. I did not know when Andhra Pradesh will open up. I don’t know when Tamil Nadu will open up. But that is the the thesis is at some point of time because now few states have seen success this these other uh states will be compelled to open up and once that open up organized players will actually make money and then when we invest then we do a lot of work this thing it is not very different your cost structure is not very different only you do more distillation and you hold it for a longer period of time. So your cost does not proportionately go up. So it’s like when you’re selling selling LV purse whether you sell it for 1 and a half lakh rupee or five lakh rupee the cost is not that different. It is only the brand. The same thing in the in let’s say for instance in liquor business right so they once you develop the understanding and buy cheap enough and after a period of time then you just have to ride. Now I don’t get tempted looking at let’s say radical price every day that there’s so much money which I’m making should I sell it? So at what point do you sell then? We will see when the company actually you know either the stock really becomes very euphoric right or when I see the company not able to perform right uh like two three quarter results will be much lower or stagnates it stagnates you know or there is some really negative development in the industry which I feel is sustainable or the promoter commit It’s some something stupid. Let’s say something they decide to go into steel business. They are into liquor business. But but and that is what has happened with many promoters in the past. You know they have gone into uh capital allocations which are never justified. So at that point of time then you know okay this has happened and see one of the thing uh Sonia which has taken me years to learn which Baya used to teach us very in a very light manner that highs are much higher than what you can think and lows are much lower than you can ever imagine. Typically when you buy a company you think you know I bought it for let’s say 10 times EV bida and go it will go to 30 times e bida it will get fully priced in so what we have created here and I will I happy to make you see we don’t call it a research department we call it wealth creation lab right because we are studying wealth creation and wealth destruction I’ve much passion we put how wealth gets destroyed as we put in how wealth gets created and that arouses a curiosity like I’m just telling you for example right now railway stocks are in very large theme you know there’s everywhere railway and defense correct I’m very curious to understand just as an example you know and I’m I’m likely to fix up a meeting and talk to the chairman what is it we are missing like for instance RVNL is there a 90,000 cr market cap for a 1200 cr i e i e i e i e i e i e i e i e i e i e iida company with 6% ibida margin and net debt. So you know I am not I’m I don’t have zero arrogance to say that you know something is wrong uh with the market or something is or the companies this this that you know as a student I want to understand but that is the case with a lot of industries now right even defense portfolio which is controlled by government what is expensive or what is cheap it’s all relative right what I’m so what we are studying here continuously and whatever experiences which we have had in the past. So if you ask me, I have no regret of not working hard to identify enough companies. We have identified any number of very very good companies. If at all the regret is only that the wisdom was not there to buy enough and to hold it through these volatile times and we ended up applying our extra mind which was not actually needed which were not required or which were not needed and we ended up exiting out of lot of very very beautiful companies which we identified. Can you give me some examples where you including I’m saying including That is the thing you see the opportunity now what I’m saying identified finance you will not believe we have bought baj finance maybe 10% of bajach finance in reliance mutual fund between and me market less than thousands beautiful to what you can create, what you can build you know but sometime you are constrained by your own thought process by or your own constraint of thinking like I am saying you like I gave you example of we have missed this entire so we caught the PSU rally beautifully in uh in covid we spoke about it you know we bought lot of PSU banks we bought will be stocks, we bought defense stocks and we made money in the first round and we got out right after that I missed out completely this rally uh of defense stock in the latest rally which has come to railway stock. So I am disappointed that I did not make money but I am more disappointed after years of my experience how did I miss it. So that is what you know keeps at least me going to keep studying some of these things that you know markets are much larger than than we think. But why is it that in 140 cr people there are only 10 15 maybe 20,000 people who have made big money in the stock market when it’s out there for people to see market patience what all of this you You have to be it’s like a the job is that of like a material ingredient but who makes a really a perfect dish that’s a yeah I’m sure you can relate this much better you know but every bawi is not the same like in the market also it’s not it’s not same that all information is available to everyone but who is able to put it through have a thesis and have the conviction in market. You know your patience will be tested every day. So one way or the other even if you make money the patience will be tested. If you lose money your patience will be tested. The market goes down your patience will be tested. Market goes up your patience will be test but eventually your conviction gets rewarded. But you know are you really convinced? And one thing which I’ve learned Sonia which I would like to say to everyone that and I’m very very proud that I have not copied anyone. I have not got influenced by anyone. I got inspired by people but I have not got influenced by people. So I my own own goal is to be a better version of Maduka every day. Right? Because see the way I have understood the market, the way I have made money, many people may not subscribe you know lot of people will not buy this kind of company but I am saying you supposing if I blindly copied Warren Buffett neither I’ll be Maduka there’s no question of me becoming my Warren Buffett right so it is better that in in the market if you truly want to succeed you have to develop your own thesis you have to develop your own conviction. Like for instance, if small cap companies are overvalued or you know you invest in only large companies we have made a lot of money investing in large cap companies including likes of DV lenuro we bought last year we bought the state bank of India we bought bharti etc etc but you know my thesis is that why should I restrict myself see I don’t have a compulsion where I lacks of cr rupees to invest. If I had that compulsion then my mindset of course will be very different that I can’t deploy that kind of money. Now I am an individual right and I am my own boss. I don’t have to answer anyone. I don’t have to answer any underperformance. If I buy something it doesn’t work for 6 months. I don’t have to answer anyone. Right? Actually there’s a different kind of freedom in that and in that there is phenomenal productivity is bettering overheating there’s so much money we made in last two years in so many small cap companies but you never wanted to manage public money you know I am enjoying what I’m doing honestly speaking my nephew is doing similarity and I’m guiding him to the extent possible but I’m enjoying what I’m doing see is market now if you’re really uh this phase of my life you know I want to dedicate to excellence that that I want to be really getting better at what I’m doing it will result into definitely monetary gains and monetization but I truly want to challenge myself every day that can I become better at this this uh this whole game if I may call it uh everyday better version of my own self do I still have the passion so for this that this format as I told you now let’s say if I was investing 50,000 crores or one lakh cr on people behalf you’ll not be able to you know buy so many of these small companies because then there is a constraint you know there is a time constraint which you have there’s a size constraint which you have so my message to uh all the all your viewers and individual investors you know you watch everyone You get information from everyone. You get inspired by everyone. But without applying your mind, don’t copy anyone. So tell me Madu, you know there are a lot of young people who watch our shows, right? Because and now a fresh new breed of investors has come into the market. If they want to become like you, they want to create build serious wealth for themselves. What is the playbook? What’s your investment philosophy? How do you identify a company? Do you first identify a sector then you drill it down to companies? I just want to understand your investment philosophy. So may Sonia first of all I want to congratulate people who have chosen investing in stock market as their full-time career. I don’t have much advice for people who are doing it part-time honestly you know because don’t rely yourself bases on the tips. [Laughter] I truly believe that this is the best possible business in the world. Not only in India, investing is one of the best possible professions. This is true businesses of businesses. You know you don’t you are not constrained that I want to invest in X business or Y business. See supposing you you you became a textile entrepreneur. I’m nothing against entrepreneurs. You no choice but if I was a textile investor I had a choice right so that flexibility is there. Third point is that you know you are meeting absolutely creme dea creela people. You know where in in my life someone like me who came from a such a small village will get so much exposure if I was not part of the market ended up meeting so many successful investors so many successful entrepreneurs right so if you have chosen this career this is an extraordinary career stick to it that is my first advice first full time fulltime that’s again if you chosen this as a career if you’re investing part-time you know there’s a He says whether you should be doing yourself or you should be giving your money to someone and there are so many very good portfolio managers who have come or done extraordinary job that’s a completely different thing but people who have chosen to be full-time in the market I want to congratulate them that this is a very good field second thing that you know this is you have to take a real long-term view of success because nothing will come easy and as I said it is lot of hard work and sun in my experience this requires extraordinary passion. This is not a 9 to5 goody goody job. It doesn’t work like this. Even today and I mean it if you tell me at 12:00 in the night Madu there’s a great idea which is there but you will have to go maybe 20 kilometer cycling and that person will meet you I will do it and it is not the money it is my sheer passion and the love for this job so you have to be able to have that extraordinary passion and extraordinary involvement in this You know and then you have to be willing to learn. You have to remain remain very humble. You see humility is very important thing for a investor you know because arrogance will not allow you to be in this market. The moment you understand you know it all market that you know ultimately I am the boss. So you have to have and trust when you when you are there and if you are systematic you’re willing to learn you’re willing to admit to your mistake you you become better and better and better at the job and you know now in our time even getting a balance sheet was very difficult. I remember when I joined the market in 1991 even getting a piece of balance sheet was extremely difficult. you have to go to Bombay shopping and register ourselves get a everything is available everything is available so it is much much easier for the people who have come now there’s so much actually there’s excess of information yeah that is also no it’s a problem but again if you are methodical if you are systematic if you really want to build you want to really devote there’s so much to learn people like you you’re doing such a fabulous job you’re getting actually the best minds in this country to interact And the format is so beautiful. There’s no constraint of talking for 15 minutes. Unlike in you know in television if I go you had the constraint that you have to finish the show in 15 minutes, 20 minutes, half an hour. You here you have so many podcast not only of Indian investors but of global investors. So if you are someone who is really devoted, someone who is really willing to work hard there is a possibility and some of these youngsters will create better investors than us also. Let me tell you in 20 years of time there’ll be some people like you look at the journey of Nitin from Jeroda you know they came from nowhere and what they’ve created they made actually India pride correct you know they like stockb broking business was known to me why I could not create jeroda I had a 10 year head start then right but but the fact is and that that is what will happen even in investing there will be a lot of people who will come, who will have the passion, who will put the put in the hard work and they will create. But you’ve come from a very small town. I just want to understand a little bit about your journey because I know that you you started from a very humble background. Were your parents um like you you came from a village, right? Yeah. Yeah. So I come from Chhattinar. I come from a small village. My father is a farmer. But you know with humility I’m accepting that I have done reasonably well in life. I could have done much better as we as we spoken. But I’m much better. There’s something about people with the similar background. Trust me, when you come from a tier three, tier four, tier five kind of cities, when you come from a background where you have no choice but to succeed, then the determination and the passion actually comes automatically. Because see I when I went to a small school in my village, it was a government school. I have seen so much adversity in early part of my career. So that resolve is there like you know today even someone who was selling tea in a railway station would become prime minister of India. That is really the opportunity of uh of life. So if you look around people who have succeeded like talk about Vijay Shakhar Sharma talk about you know people like even Sajan Jindal or Gautamay you know who created empires in last 20 25 years but if you look at the background of all of these people now ma’am I have nothing against people who are highly educated or they come from good universities or colleges you know but a lot of these people had no such background including me. I did not go to any fancy school or any fancy college. But but the resolve was there that the resolve is only getting more stronger. Actually I want to know because I see it with a lot of people that beyond a point money stops making a big difference. Right? I mean of course but there is this passion to do something. So how what motivates you to you know get up every day after a point of time consciously or unconsciously you start loving the impact which you are making the impact which you’re making on larger society on people on say supposing if I work with an entrepreneur very closely and I I share my capital market wisdom with him and he kinds of supposing he finds some merit in that and he implements it and it the company ends up creating thousands of cr rupees of value. So I’m not actually waiting for him to give me a certificate that I contributed in his journey but it gives me tremendous happiness and tremendous uh confidence and that is what keeps you going. See ultimately you know you have made enough money there you there no reason for you to continue to do these shows why are you doing this you’re doing it because there is a sense of contribution which you also subscriber there is somewhere the pride which is there that one lakh people are watching the good work uh which you are doing right and and you are able to contribute same same thing that but I’ve not made enough money I can still make money I’m I’m sure you have made enough money and I’m sure you will make enough money. You are on the right track now. But every person who I speak to whether it is Romesh, whether it is you, whether it’s Vijay, Ky, anyone, they always say key, we could have made lot more. Romesh G when I spoke to him, he was the first guest on my show. He said I my only regret in life is I could never make as much money as Rakkesh G and as his peers Vijay K also you know oh I could have made lot more money. Yeah, it’s never enough now. Then it is that fulfillment after making 1,000 crores or 500 crores which is like people can never think of this money in their lifetime. It is not about the absolute amount of money. The disconnect is not living up to your full potential. At least I can talk about myself and maybe it is true, maybe it is true. We knew that we are capable. I knew that the whole glass was there for me to drink. Didn’t I had 1 cr to invest in DVs? Didn’t I had I have obviously had didn’t I have but you didn’t invest? I didn’t invest and I didn’t kept it. Otherwise the my DVS invest if I had invested 5 cr rupees it will be 7 and a half,000 crores in the name of Maduka right by now I don’t have it. So the the the discontentment discontentment is not for not being able to make that money. Maybe that is also there but it is not being able to live up to your full potential. So how do you live up? I want to understand even for myself right? How do you live up to your full potential? Everyone knows deep down that is what I’m saying. You have to keep learning from your mistake. You don’t have to say that you know you have it enough. I can’t invisize my life without markets. I don’t know what I will do. Same even with me. Right. We will we will devote ourself and and years of this experience which which one has accumulated one would like to make that one would like to see that one makes the most out of it. And as long as you are hungry for that excellence and you are truly living your passion, I don’t think you’ll get tired in whether it’s Rakkeshunala, whether it’s Romesh Damani, whether it is Baduca. One thing I’ve noticed is they can withstand failure very well. Right? A draw failure I mean a draw down of 30% 40% 50% in the stock. That’s something I can’t do. Not yet. conviction Ukraine 20 if it falls more than 30% I start panicking. So how do you as an investor cross that hump? So there there are two things you know I think one any stock which I buy I ask my question I ask myself one thing now if this stock falls by 25%. Will I buy more or will I panic? Even before buying before investing now I ask that question to myself and let’s say if the stock actually falls by 25%. There is a certain thesis which I had there certain numbers there certain fundamentals on which I had based my argument the stock would have fallen either by some temporary reason in the company or because of the market. It has happened because of the market and if I have money then I I surely will go and buy more of the same company. Can you give me some examples just for understanding? Take for instance ITD cementation you know we you remember that you know I think all I give you and we have obviously you must have run full disclosure yes full disclaimer that there is it’s not recommendation it’s not recommendation all I give you one example Like I like this company which is owned by Brookfield. It’s a small NBFC called Endar Capital right and we’ve I we’ve liked it for a very long period of time maybe. So we we bought it you’ll you’ll find it very funny because of the Brookfield name in parentage. We bought the first time the stock at maybe 250 260 rupees and the last then four six quarters nothing happened you know then there was some sebi compulsion for another investor to sell the stock and the price became 100 rupees I aggressively participated 100 rupees and that is what can your preparation can do so the thesis was the Brookfield ownership the conviction nothing has changed only four six quarter results have not At that time the net worth of the company was 3,000 crores and the market cap had become 1200 crores and we bought more much much more than what we bought at 250 rupees at 100 rupees. But if four six quarters results don’t come that doesn’t make you nervous management you know the company is not in credit worthy so they are not getting the liability but I in my mind in my thesis I still know that the parentage is so strong that eventually all of these things will get corrected And a lot of it is there in value. So when it when it went from let’s say 100 to 200 rupees and then it corrected again to 150 we bought more. Then again from 150 we went to maybe 250 and again it corrected to 200. We bought more. So even today I’m saying no if the stock corrects by another 50 rupees I may end up buying more. So what I’m saying you as long as you made a thesis on any company and you are convinced about the thesis and fundamentally nothing has changed then the price corrections are beautiful opportunity because we as investors are only looking to deploy our money into companies which can which can make profitable investments you know. So what what is there to be scared? But let’s understand there is a difference between risk and uh volat volatility. What I’m talking about is volatility in sometime there could be a risk like in my portfolio let’s say I bought Japra cash associate in my lines days right and that stock fell from 300 rupees to 200 or 150 rupees and we could see that things have changed leverage has changed the company has changed etc and we ended up selling that was risk that was risk you know and we had to get out at that point of time because if we had not got out our money would have become zero. So you know it’s not like you can make one formula and that will be applicable everywhere. When the stock falls the most important thing to go and reassess that is my thesis is still intact. Do I still have conviction that the business model is of the company is strong? the parentage is still very strong and nothing fundamentally has changed in any dramatic manner. So can I ask you one question on someone example right say example like Asian paints great company great management good business strong you know dynamics everything but suddenly there’s a big disruptor in the market office and stock starts falling what do you do at a time like this so if you have conviction again the difference is the you don’t know how the competitive that’s why I’m saying the whole question is has it become cheap enough for me to go and high you know what is priced in so I gave you an earlier example of indust when I thought that at 1200 cr market cap a lot of it was priced in for a 3,000 cr uh uh network right I don’t know whether that has got priced into Asian paint as of today you know what all can get disrupted and there are many more competitors but supposing let’s say Asian pen for instance it falls a lot and it becomes really attractive then it is a buy M I don’t think the there’s any thesis on the management or the external opportunity or you see today there’s a competitor in every industry there will be a competitor there why talk about only one builder there were 10 other people who come in can come into paint industry but that doesn’t kind of you know take away what Asian paint has built uh in that sense so if the stock really becomes attractive that time I’ll certainly go and buy it so you I was having this conversation with Rajiv Takar of Parak Parak and PPFS and he was telling me that a lot of industries are now in a winner takes all sort of situation to abcommerce there are six players right now pansal you may only have one player one or two one or two max righties so what do you do at a time like that like for example quick commerce now I’m an investor in some of these quickcommerce companies But who know they’re doing well today but who knows by marketual and that is why I said this is a very technical subject right you just can’t say it’s not blanket statement blanket statement but when you go and do your deep dive deep dive research you will know which business model is very strong which are the people who are actually making in incremental headways and which are the people who are actually losing money and by if you are really truly devoted and passionate about it you will know that who the winner is and then you know let’s say you beted on three companies in one or two companies you may lose 20%. But that is the time you have to have the guts to say okay I will cut my losses and this is the guy I believe is going to go and that guy could make it much much bigger correct than what you think he will end up making. interesting. So how are you um how do you look at the promoters of a business because there are a lot of great startup promoters who are coming into the market right but some people are maybe too aggressive I mean like for example Ola I’m just giving one example right business great space to be in EV is growing very fast but somewhere down the line it’s a promoter issue as well how How much importance do you give a promoter? I give a lot of importance to promoter and I used to like very aggressive people when I started my career honestly but over a period of time it is something which has learned that you know only aggression does it will take you only this far but uh it is not your final destination that you are you are going to be succeeding with only aggressive people. So when you look at a promoter of course you look you want to back a person who has got real fire in the belly but at the same time you want to back a person who understands capital allocation who understands you know what the resources are who understands how to build a team who understands what risk is he taking to achieve what exact etc etc and in that journey right honestly for me promoters and management are One of the most crucial things which I look into any investing I used to look in the past also but over a period of time we have continued to refine the way we look at it and I think we are we are still it is work in progress like for instance I’ll tell you when this whole episode of Adani happened I must be one of the only few vices who have come to your channel and said that it is a buying opportunity because one hindleberg can’t take way what Adani has created. Correct. You know, it requires a tremendous entrepreneurship to go at a to go to some baron land and visualize that you could build the largest port of India here. It requires even more tremendous opportunity to go even to Ka and visualize that you could buy two lakh acres of land. You know, one incidence can’t take away all which you have created. So in that kind of a situation when you have bagged a promoter and you know there is a 20 year history of them of not blowing out money no real big capital misallocation no real big you know siphoning of money etc etc etc the time so you want to back promoters who have actually done phenomenal work and are really really focused not on talking but on execution. Right? But you know if I would not make money and if I not execute what I’m talking I would not have the opportunity to have this conversation with you. Correct. Right. Absolutely. Because I have executed what I’m talking in my life. That is why you have come and having you are having a conversation with you. Same thing is true for promoters. Like you talk about you know quarter quarter after quarter you know so at some point of time when the things improve we’ll change our view okay So I think we have spoken for about 45 50 time. Absolutely. I have so much to ask you especially about you know investors what is what are the big themes big trends that you see over the next five 10 years. So I think you know the way to really look at this again it comes to my investing principle that you know I all my life I completely bottom up investor that you identify something you like something and you buy it you but now it has kind of got modified over a period of time when you want to look at what you are buying bottom up does it form part of some larger theme you know is it is it also fitting into a top- down kind of approach right and that works really beautifully Sonia because once you identify a very powerful theme let us say supposing after covid you said that I want to invest in PSUs what PSU bought it didn’t matter honestly whatever you would have bought it made money So supposing if I like one PSU, two PSUs, three PSU then I said okay the overall PSU as a theme itself seems like coming back because lots of PSU stocks are showing price increases etc etc etc. So then you know that yes it is uh it is a theme to back on. So that gives you a lot of kind of conviction. M so these days whenever even if you find some bottom of ideas we we first try to make sure that whether it is a part of any a larger larger theme so one of the themes which I’ve liked is uh which is really long-term maybe next 10 20 years is this whole theme about carbon neutrality climate change this that you know because I know that temporarily lot of noise about it may not do that well you know specifically with whatever Mr. Trump has said but I for one believe that climate change is a real problem and it will need to be resolved in due course of time and for that we don’t have to go and ask any expert when you go to Delhi in the month of June and when you see temperature has gone to 51 or 52° last year and when you see you know rain or winery so we know that you know something is tricking in right so in this entire climate change I feel there will be lots of opportunities and so this is one theme which is there to stay now the important thing Sonia is that you know today you and I discussed just because it’s a theme do I need to go and buy some stock tomorrow morning no you know but then I have to really be able to find the right stock in in that proper and create the thesis create the thesis we be able to buy it at a right value and because of the volatility that’s the nature of the market because of the volatility and some good or bad news coming that’s how opportunities will get created but at that time if you have a clear picture that this is a much larger theme when the opportunity comes at that time that is when you really go all out so I just give example this thesis was there in my mind so when I met with transformer company, transformer and rectifier for the first time and we spoke about it in your studio, right? For the first time. This was a larger theme which was playing out in my mind that you know energy transition because renewables are here to grow. Wind is here to grow. That is we can see every day there is addition in renewable capacity which is happening. Now wherever it is happening it will need to be transition and it will require a lot of transforming capacity that much is what very clear and plus lot of old networks are there that also needs to be revamped. Now when we looked at it and we talked to a couple of people they said there’s a shortage of transformer I spoke to couple of my industry friend and we we did little bit of research on with one or two US companies etc. There’s a shortage of transformer and they’re booking transformer 2028 29 then this company came the absolute market cap of 13400 cr right and the CFO came he’s a very good guy and he explained the story I found some real merit and then we of course we went and met the management after we invested but you you will not believe we made a very quick decision and it was like a roughly like a tin bagger for us in less than one one and a half year and see we sold significant portion of the stock because we felt that we’ve got our appreciation. Now the whole point is that you know this is kind of exemplifies what I’m trying to tell you that you know you identify a theme you keep in mind at that time then you get a bottomup opportunity which kind of marries with you a larger theme to go and take a a larger bet at that point of time. So you solidify your conviction from all end. Exactly. That’s what that’s what I’m trying to say. And any similar thing like like pharmaceutical form CDMO company for a long period of time. Now whenever we get opportunity because we know that CDMO thing may be here for the next 5 10 years. All the companies which are doing CDMO business will not do all the time in the next 5 10 years. Right. And lot of them have also grown grown grown. Some of them will create opportunities. some bad news will come in the industry in the market or a stock is specific in that company. So as long as the business model is not broken it will give you an opportunity and chance to buy those kind of companies and that’s what again you know it makes the job kind of interesting. Wow there’s so much learning in this madu but uh you know I’m also starting to get very hungry so so should we go and eat something somewhere? Yeah sure positively let’s go. Okay. And uh since you are but I want to know where you’re going to take me because I expect I know that you’re you know you’re very simple. So I don’t think you like fivestar hotels and all of that. There’s a really good place called Swati here. You know it’s a very good food. I love this. We can go. So let’s go. Okay. [Music] So, so we have come to Swati snacks. That is This is the best part. Duri that’s your spoon. So, this is the first time I’m coming here by the way. Is it? Have you been here before? I I’ve come here many times. My office is next door. So, I come here quite often. It’s one of my favorite restaurants I would say. I thought you you know we have to you have to enjoy the food. Correct. Right. Correct. Absolutely. So it’s a really nice place. Really enjoy the variety here. Yeah. Panki is very good. Pi is very good. Let’s call for some panchi. So um when you sometimes do you think also I never expected it’s a it’s a remarkable journey right but you know like you know the oh wow the possibilities in life You can never emphasize that these are all possibilities. You know, you reach somewhere then you start reimagining to be honest with you. God will I always knew that I’ll be able to do something relevant but God is so kind. But you know you would never have imagined that you will come this far. But that’s how life is. You know once you achieve something then you have much much more encouragement to even work more harder and achieve something larger and then you start really developing interest into subject and you know become very passionate about it and that becomes way of your life. So of course you know then I would not lie to you that I don’t want to make of course I want to make money but now that there are much deeper purposes as we’re talking in the office about really making an impact or really enjoying what you’re doing getting really the excellence in what you’re doing. So I would say you know God is very kind and one should not mistake that it’s all your capability and there are hundreds and thousands of more capable people than me who are there but it’s just that I’m blessed that’s the right time at the right place right time right place and right opportunity yeah right opportunity and right blessings and also right mindset yeah that that that credit you can give to me no and that’s That’s why I’ve called my show the money mindset because I feel more than making money in stock market is the right kind of huh let’s have a we need some chutney. I love it. Please. I love pi. Very very good. Very light. This is good. This was a great idea. But you know one thing that stayed with me you learned from Rakkesh Jindala that you know you never know that the highs can be much higher then what you think and lows can be much lower. I must tell you meeting Rakkesh G was a real turning point in my life. I met him sometime in 19 98 99 and uh you know I’d gone to meet him because I wanted to I was working in a booking firm. Yeah, I wanted to sell him something which I thought was very valuable and the man he was took a decision very quickly and then of course we developed a very very good but how did you know him like how did you meet him? No, I just went absolutely went to his office. Wow. But I knew he was not big that time. No, he was always approachable when he became big also. He was always approachable. You’re not eating this miti. It’s the best part. I’m so approachable. So you know before meeting him I must candidly admit to you the stock market was a way for making a better living for me and it was about income generation but I could never empathize at that point of time that you can actually create generational wealth generational wealth and so much wealth It is him who actually you know and he was so generous, so kind you know in sharing all his wisdom, all his knowledge etc. And it was you know absolutely fabulous. Would you discuss a lot of like ideas with him? all the ideas with him and he was again you know even if it’s something he would not buy but he will advise me right that see I’m not going to buy because the size is good but I don’t like it but you can still buy it or you should avoid it he very very generous and you know later years he became literally like and with absolutely no hesitation and I’m very proud to say that he was my true friend philosopher guide and a real elder brother you know who generously generously contributed all his wisdom knowledge and love very affectionately. I truly miss him but uh you know so what were some of the big lessons from him in the sense something that you always remember when you when you are investing or just in life in general a lot of his lessons were a lot lot of his lessons were also about market and much about life. So I think I have spoken a lot about what I learned from him in the market. But let me speak about what I learned from him about life. So he is someone who actually taught me what is the value of humility. You know why we should remain humble and why you know whether it is money or power? Why it is something which can you know just go like this. the moment he used to tell right. So yeah then the the simplicity with which he used to lead his life you’ve seen how he went and met the prime minister of India within an open shirt and this that no iron shirt no absolutely that that is the person he was so also whenever I would discuss with him you know the value system why we should adopt the right beings to achieve right things in life, what is the value of the family, about children, about friendship, you know, how he was as a friend and again lot of things about life, you know that why see this is such a and you know it better than me that it is not a market where people generously want to share. You know people are very shy of sharing, guarded, very guarded. But even someone who taught the more you share the more you will become knowledgeable because as you share other people will also share right yeah correct if I’m nice to you over a period of time you bound to be nice to me right that’s how it works so he will openly share and that’s how I am honestly Wheons but I will tell you what I know in life I think what you show is what you harvest right Correct. So if you if you show goodness the goodness will come to you. If you show abundance abundance will come to you. But a lot of people talk about you in that way like you know I I know I interact with lot of market people. They only have good things to say about you but I want to understand money journey. It can go to people’s head right 5 crores, 10 crores, 20 crores, 30 crores, 1,000 crores, 2,000 network relationship with money, attachment. How do you work around that? Because then all relationships become about money. Everyone who approaches you has somewhere down the line something to gain or lose from you. Do you feel that way? No, I think you know there are people who come and of course I don’t make a judgment of thank you. It is very nice and Very nice. Not too much sugar. Nice. You enjoy it. My recommendation whether it was a food or a stock, they’re all good. People approach you know people have different intention but that you know that someone has approached so he will have only intention of money I try to help whoever I meet with a good intention and you know even if lot of people everyone doesn’t come across in life as how you want but I feel if you’re good the goodness comes back to you in one form or the other and I must tell you I will continue to be like this only I don’t think like my family is very simple my children are very very simple and I’m very very simple that you know our lifestyle has not changed and touchwood by the grace of God will never change because of the amount of money which we have or we will have you know because My lifestyle is not linked to what I what I earn or what I don’t earn. I always want to remain in my middle class roots you know wherein you can you should have a decent life but you you should never splurge money you know you should never abuse money those are principle which even Rakkesha has taught and even my parents have taught us right if you have money there much more you can do with money like trust me I enjoy my journey I am associated with Laksha university where I’m a founder. I’m associated with Hyavawar uh medical college uh Samsum Institute of Medical College in Orurangabad. So lot of lot of good causes in life where you can actually use your money in the right way in the right way. But do you ever feel like um as you make more and more money do you feel like oh there’s a risk of losing it? Do you get more attached to it? And I mean because you know I heard a quote somewhere I don’t know if it’s true someone said that money is uh provides give brings you happiness up to a certain point beyond that it brings you misery it makes you miserable. This is what someone said. So I wanted to know from you that does money bring you happiness. No it see it does bring it does bring me happiness but I would agree with you only up till a point of time but then you know if supposing you are only living your life only around money then you will tend to whenever you lose it at that time it will the pain will pain will be there but see the Way I look at it I have a very good lifestyle. I have my own house. I have my own requirement which are being more than God has been very kind and we’ve seen many number of time our network go down by 30 40 50%. many number of times I would say. So we have seen it all you know but we know as long as your mind is working and see if you have built a lifestyle which is attached to a certain level of income which you have then it is it is very painful. Let’s say supposing I build a lifestyle when I spending 200 cr rupees every year and when the market goes down then it will hurt me much more. Correct? But if I not really build any sensive lifestyle, it’s okay, right? We don’t want to lose it. But if you lose it, we know that we’ll make it again. Yeah. Yeah. That is true. So I must tell you honestly, if you are asking me has it gone in my head, it is not gone in my head. No, that I am confident that hopefully it will never go into my head. And what about with your children? You have two children. Yeah, I have two daughters. So how do you make sure because I’m asking this question from a personal This is a chutney. This is very nice. It’s really good direction not so like I’m also raising my child and privilege. You can’t help it. You can’t help it. You have to accept it. But how do we raise our kids in an environment when there is so much excess of everything? How do we raise them? My experience by example not by yan giving yan right so if I continue to tell my children that you should work hard you should work hard you should work hard and I am all the way all the time roaming around enjoying life etc etc it’s very unlikely that they’re going to listen to me but if they see that I’m also putting 14 hours a day and then after that if I tell them so we have to you know it’s a challenging task for us for you or for me for people like us to create that hunger in our children but I think the best way to create that hunger is to lead by example but I also feel like we had that hunger because we came from a background of scarcity right I mean even I came from a middle-ass background my parents didn’t have too much to they they have gave us a great childhood but everything resources were limited but that is not the case right now resources are in abundance So is there anything for our children to be longing for there is I love you to meet my younger daughter but love to meet her only 16 years her name is Mika extremely focused I must say she’s in 10th standard but you know and I’ve had this conversation for her with her She said that you have had your journey. I want to have my own journey all my life and she’s clear about it. I don’t want to be a shadow of maduka. Correct. I want to create my own identity and as long as she’s clear about it she will create something and the best thing for whether it is your child or my children they don’t have pressure you know that they can work with a free mind and they can and they have a lot of resources and also they can fail. Yeah. We didn’t have that choice. Exactly. We had to just do we had to pick options in which failure was not a a choice. I mean they can start something if it fails they can start something new. they can yeah they can redo it or they can they can do something else that’s what I’m saying they have the luxury in that sense but I think you know if you see even the second generation I take about Gautam Madani second generation you have to meet them I’m telling I I had interaction with Saga Rangi amazing amazing guy I’m telling a 30-year-old the kind of hunger focus he had is absolutely amazing Right. The other day I met with Park Jindel Sajindal what he’s creating whether it is JW cement or JW paints etc etc. It’s not that you know only because you have he’s very razor focused in his approach. Yeah, that’s what I’m saying. It’s not just because you have done well your children will think that they have enough money they don’t need to work. They will have their own journey. But in terms of entrepreneurship, entrepreneurs, do you see a lot of because second generation doesn’t want to take forward what their parents did, family office, I don’t I strongly disagree. There is a section of that which this is my favorite subject. I think India may the progress of India is actually happening because of the sheer grit, the sheer determination and the sheer entrepreneurial culture which is there in India. You know there are 6.3 crsmemes which are listed in India. There are 28 lakh companies which are registered in India. 28 lakhs out of which maybe 18 20 lakhs are are active companies right including startups and everything starting with startup everything put together see when you go into Narimon point you can actually this is a live example of thriving entrepreneurship of India but in and around this 1 kilometer area you can spot 500,000 entrepreneurs you know If you go around any developed country or even developing country, you can’t see this level of entrepreneurship. I think India has succeeded or it is in the path of succeeding apart from everything else. It is because of its sheer entrepreneurial ability and because see we came from 75 years back we got freedom 88 years back. All our parents and grandparents have seen a lot of adversity. So that is ingrained in our mind right that we have to achieve something. We have to get wealth. We have to make sure that uh come out of our adversity come out of come out of our adversity. Yeah. So that entrepreneur culture is there and that is what creates all this company that but then why do you think it I know I mean it is a to a certain degree an unfair comparison but still I will compare whether it is to China whether it is to Singapore whether it is Japan right per capita GDP wise India if you remove the top 1 2 5% is still struggling below 2 because you know because those countries started much earlier than us you know China is maybe 20 25 years ahead And they had an autocracy. We have a bureauc we have a democracy. Right? So we have our own challenges and we have compared to where we were 20 years 30 years back. You have to see that we have also made a lot of progress as a as a nation. Right. So one can’t say thank you that can you get a another bowl? Yeah. So can one can’t say that we have not progressed. Obviously you know China would have done definitely better because of their whole overall culture move from agrarian to industrial also happened very fast. Exactly. As I told you there is a authoritative uh autocratic autocratic setup which is there and countries like Singapore or Japan they are 30 40 years ahead of India you know they started things much earlier hopefully over the next 20 30 years maybe this question will not be there. think there is something that needs some gap that needs to be plugged or are we well on track to get to that $3,000 per GDP? There’s a lot that needs to be done. I don’t think we can be we can say that what we have achieved in the next 20 years whether it is for individual in one month. All of this will vanish if you are really not on top of your game. So as a country there are many challenges which we have and we have to solve many of them. There’s no doubt about it. Right? So we need to and specifically with AI and all coming you know in uh in in real sense I think there is there are going to be opportunities job issue for sure job issue also but you know again at the same time there are opportunity we never thought there going to be so many GCC’s in India group in India 10 years back you go to Bangalore the whole street is full of global competency center. We never thought all of this will come. So there is some loss, there is some gain. So as long as I’m very bullish, as long as we have someone like Mr. Narendra Modi, Sarendra Modi as our prime minister, you know, was really dedicated and was really really got. I remain very optimistic that you know this uh these bouts and the challenges will come but as a nation we are surely making progress. Wow. Yeah. I mean I can see the progress as well like when we when I started reporting on stock markets in 2008 Sensex had fallen to 8,000. I remember that day. Today we are at 80,000. So 8,000 to 80,000 journey has been full of potholes and ups and downs and everything. That’s exactly what I’m saying that is never going to going to be like stock price. It will go up and it will come down. But as long as the eventual trend is up you have to and what is life without challenges? Yeah. Correct. We have to there will be no thrill if there are no challenges. Right. Absolutely. After you can say that after the challenges get over. Yeah. And but you know at the time of the challenges it’s hard but once it gets over but you’re dealing with them also if you take it in the right spirit. Yeah. Right. It is. So I want to do a part two of this conversation with you Madu very soon on deep dive into sectors themes focus all of that. I’ve enjoyed talking to you. It was really fun and we must do I’d be very happy and Sonia you are this is reaching to so many young people. I wish even if 1% of them take out some relevant content or some inspiration I would think the time was well spent. I agree with you actually. So many young people are there here watching right in our team. So what is the what is the I know it’s a very cliche question but what’s the one top piece of advice that you would want to give every young person who’s trying to stay relevant make money build wealth for themselves build generational wealth the first and the foremost will be you have to truly identify your passion you know you have to understand what keeps what drives you what makes you happy, what makes you involved, what really works and tricks for you. But I have seen in my life nothing of any significance is achieved by anyone in any field unless you are truly devoted to what you are doing. Now whether it is a Tendulkar or whether it is an Amitab Bachan or whether it is a Dhaii or whether it is any Narendra Modi anyone who has achieved anything of any significance in life they have been truly devoted they have been very very passionate they’ve been extremely hardworking so we don’t have to reinvent the rules for success they’re all laid down the question is how many people can actually practice them on a day-to-day basis. That is one, right? The other thing is that you know if you if you set life any agenda that you know on any target that okay I’ll achieve this after that my life is going to become good. Let’s say you set a target that I want to make 10 crores and after that I want to enjoy life. That’s not the right way to look at things. The right way to look at things is what can I do in my life so that I can keep on doing it till my last breath. I must tell you at this year my biggest inspiration came actually when I really studied MFH now that guy really painted for 90 years and you know his last painting became the most valuable painting. If you ask me, I have one wish that whenever God takes me, I’m going to tell him that please allow me one more week. Let me get one more idea. Oh god. And then you can take me out. One more multiagger and then you can take me away. So it’s really a never ending journey. It is. That’s that is what my advice will be that you know you should not you have to identify something which is because see at the end of the day for any individual eventually Sonia it is all about creating identity. What are you trying to do? What am I trying to do? We are actually somewhere living for creating our own identity first in our own eyes then for public that are we relevant for our own self. Yeah. And I am saying that relevance will only come with very very consistent hard work with lot of devotion with lot of passion otherwise it’s a very competitive world you know. Correct. Correct. Absolutely. I think 1% people end up succeeding. Correct. That was that’s how I started the my interview that you know it’s only 1% people not even 1.1% people succeed in stock market. That is why that is why it is difficult that is why it requires that extraordinary passion devotion hard work commitment whatever you call it. Yeah we’ve actually run out of time but thank you so so much. This was an amazing conversation filled with lot of wisdom, market wisdom and lot of amazing food. So thank you. Absolutely. Thank you so much. But I must tell you that I when I look back on a closing mark, when I look back my own journey, trust me, I think I’ve not yet begun. But there is really so much now energy in me right now that and obviously there is some understanding of the market and there is some money which which you can take risk and the plethora of opportunity which India is going to throw up. I wish I was 10 20 years younger but it doesn’t matter because at least I am very clear that is a lot more lot lot more I want to do over the next years of my life than what I have done and I hope and pray you continue to succeed the way you are. Thank you so much. Yeah and it was an amazing conversation. Thank you so much. It’s also our 100k subscribers so it’s our special episode. So thank you for being congratulations and all the very best. I’m sure in this journey you will do really really well. Some of the content which you’re doing is really coming up well. It suits the format and you are someone I have seen you have worked really really hard. So all the best to you and your entire team. Thank you. Thank you mother. Thank you. We’ll catch up again. Of course. 100%. 100%.