Hiren Ved Reveals The Hated Sector For Indias Next Billionaires

TITLE: Rsflbs_Zp5M CHANNEL: Unknown DATE: ---TRANSCRIPT--- Hello and welcome everyone to the India Opportunity Show. I’m your host Shrishti and today I’m thrilled to welcome a market veteran and one of the most respected voices in the public markets, Mr. Hiren Ved, founder and chief investment officer at Alchemy Capital, a firm that was backed by Mr. Rakesh Jhunjhunwala himself back in the ’90s. Hiren is a third generation in the public markets. He talks about how he learned from his grandfather and father’s experiences in the public markets and how he grew up with that wisdom in his DNA. You will be able to understand how Hiren truly thinks and more specially he talks about his learnings from Rakesh Jhunjhunwala, who he learned so much from through osmosis by working with him and interacting with him. We talk about different market cycles, what to look for in different sectors and companies and how to truly discover the Amitabh Bachchans and the Shahrukh Khans of different sectors. All this blended with wisdom of spirituality. Hope you enjoy watching. India is one of the fastest, largest growing economies around the world and if you want to participate in India’s growth story, you need to be backing Indian businesses and companies. Whether you’re someone who’s already been in the markets or has just started investing, Grow is the place to be. Grow gives you a clean, simple and intuitive investing experience which is unlike any other investing platform. You can invest in stocks, mutual funds, ETFs, IPOs and even commodities all in one place. You can track your portfolio performance, sector wise distribution and get a comprehensive view of all your investments all with just a few clicks. No wonder Grow has now become India’s largest stock broker with over 1 crore active investors. Check out Grow. Good morning Hiren. Welcome to the India Opportunity Show. Thank you for joining me here today. Thank you so much, Srishti. Thank you for having me. You know, I’m so grateful that you took out the time. You don’t do too many podcasts. In fact, I haven’t seen you do too many podcasts. So, thank you for giving us this platform to host you on. No, no, it’s my pleasure. And Hearin, you know, while I was sitting with you, I learned so much about your family history, how you were third gen in the stock markets. You know, many people starting out today don’t have the context or visibility you’ve had into the stock markets. It’s literally embedded in your DNA. So, why don’t we start there? Because I think that’s a fascinating story for the audience to hear. Yeah, I mean, I I got I got interested in the markets very early because our family has a long history of investing in equity markets. Started with my grandfather when you know, they had to wind up all their businesses in Africa because of the political upheaval. So, you know, when he came back to India, he decided that he wanted to invest a lot of his surpluses in the stock market. And then when dad moved to Bombay in the mid-60s, obviously the Bombay Stock Exchange was physically in Bombay and my grandfather asked my dad that now he should look after all the investments that they had done. And then, so my dad started to, you know, go to the stock market and meet people and he would attend annual shareholder meetings and sometimes he would tag me along as a kid, right? And I had no idea of what was happening, but I would accompany him just for the fun of it. And slowly it became like a ritual and I started to get very interested. And 1978 was like a watershed year for India stock market because a lot of the MNCs were forced to either quit India or to list. And that’s when a raft of IPOs of many MNC companies, you know, happened in ‘78 and ‘79. And like that invested in all those IPOs also one of the most iconic companies went IPO in 1978 Reliance Industries. Right. So I I I was very interested because the annual reports would come home. I would flip through them. They were very colorful pages and I would read some of that commentary. And then later in college because I did accounting, I was a commerce student, I did accounting, I would I would read annual reports and actually one of my passion was to collect annual reports. Like I had a whole uh Godrej you know, almira full of annual reports, right? Because nothing was digitized in those days. So if you had to refer to something which was 2 years old, you would pull out the annual report and say, “Oh, this is what they said and now this is what has happened, right?” So yeah, I mean I got exposure to companies, you know, and I was quite fascinated by how company management, specially the chairman of the companies would stand up at the AGM and give the vision for their companies, right? Dad would say, “Okay, now listen to what Dhirubhai Ambani is saying or what Rahul Bajaj is saying.” And that was quite interesting for me. And yeah, so so so so this kind of you know, I was very clear that this is my calling. And I want to build a career in the stock market. I even ran a stock market game with my accounting prof in college, right? So, uh we we would play with paper money and we would do buy and sell transactions and our accounting prof would keep the accounts and at the end of the year, whoever made the most profit got a got a princely sum of 10,000 rupees. Right? So, that was the that was the inspiration, but I you know, I I loved to kind of read about companies and sectors and and why stock prices go up and down and I think over a period of time I started to get a hang of it. Mhm. So, yeah, those were the early days and the the inquisitiveness to learn about so many businesses is as alive today as it was 30 years ago. That’s so fascinating to hear, you know, because you were just saying that you know, there was no Excel, you literally had to do paper-based calculations back in the day, keep a track of everything. Yeah, our first job early in the morning was to read the six pink papers, right? And you know, we would mark out all the company related articles that would come, anything that we thought was relevant for a sector. Mhm. And if there was some data embedded in the news item, then you know, those paper cuttings were cut and filed away in physical files, right? Because back then computers were not still in vogue and we had to keep physical information in files tucked away. So, that was quite interesting and we would literally make there was no Excel, so we would sit down and literally make the P&L on a piece of paper, right? So, you start with gross revenue minus excise duty, net revenue, then raw material cost and it was quite interesting those days. Obviously, we’ve come far far long now, everything is done in chat GPT. quickly. I wanted you to share the story because you know the audience might not even have the context of how it worked in the ’80s and ’90s because we’ve been so spoiled with all the technology that pervaded our lives. Yeah. But it’s you know what you said was something very interesting. You saw Reliance’s IPO happening, uh Mr. Dhirubhai Ambani at that time. And you know, what I find fascinating in your journey, of course you founded the firm with some market legends, right? Like Mr. Rakesh Jhunjhunwala being your partner is no small feat in any way, of course. So tell Take us back to that time.

other way around. I’m fortunate that I was part of a firm. But no, I think actually I’m one of the co-founders. The firm was initially founded by two of my very dear friends and now partners, Lashit Sanghavi and Ashwin Kedia. And it’s a fascinating journey that you know, I actually I I met them at a very chance meeting in 1991 October at the annual shareholder meeting of United Phosphorus. I didn’t know them, they didn’t know me, but in the good old days as I said, the way you do your research was that you bought five or 10 shares and that gave you the ability to attend the AGM of a company. Mhm. And we were one of the kind of non-employee shareholders who had traveled all the way from Bombay to Vapi to attend the annual shareholder meeting and we just had a common objective to ask a lot of questions to uh to the management about the business, right? Because there were in those days in the early ’90s, there was no conference calls and no research meetings, you know. So how do you know about you know, so you would go you would befriend the management of a company, you would try and ask a lot of questions, get as much information as you could lay your hand on. Mhm. Um So that’s where I met them and we became friends, and we were friends throughout. And it was 9 years after we first met. And I I had worked with two other firms, and I thought that I’ve had enough, and the entrepreneur bug bit me. And when you take these career-defining decisions, you sit with your best buddies and friends. And then, you know, over several discussions, an an idea hit upon that, you know, we’ve known each other for many years. We have a common passion for markets. Why don’t we start a portfolio management company? And that’s how Alchemy came about. And R.J. was already a partner with Lashit and Ashwin, and then I became the fourth partner in the business. But, I think it was quite fortunate that you know, he he he had the vision back then, you know. Private equity investing is in vogue today. He had the vision to do it back then, to back young entrepreneurs like us who were literally greenhorns in the business. But, he had the vision. He was bullish on India. I was bullish on India’s capital markets. And he thought if you have young entrepreneurs who can do business ethically, then he would want to back it. And and that’s how where Alchemy is today. So, yeah, I’m part of that journey. And that’s so fascinating to hear because, you know, obviously at that point in the ’90s, when you were meeting all these people in AGMs, and you know, partnering with them, no one could have imagined that the Indian equity market would play out the way it has, right? Like, we were just talking about before we started that it was literally looked upon as Satta Bazi, like gambling in the markets. It wasn’t supposed to be a structured industry that would see like such a leapfrog and exponential growth which has happened. Talk to me about that time. What was the lay of the land really like? How was some of these interactions when you were having those in the 90s? That must have been a very different time to have experienced in India. Yeah, I think you know in in in those times merely having access to information itself was a competitive edge. Right? Because information was not easily available. You had to go and look for it, right? So, you know, you attend AGMs, you read annual reports, you know, there were industry associations. I remember me and my partner Ashwin, we would go to we would go to the polyester filament yarn association and collect production data from there. Or the cement manufacturers association, they would because all the producers would send their production figures there, right? And all this was not very easily accessible. So, how do you get access to data? Right? And we had to literally go to every source of data. It was quite interesting. In those days, there were only half-yearly results. So, September and March. And the results were put up on a notice board in the stock exchange. You know, there was a area where the there were many notice boards and they would pin up the result physically. We would go with a notebook, quickly write down all the results because you know, everybody would declare results and there was not enough space. So, the peon would come and remove the result the next day or after a couple of hours and then put another. So, we didn’t want to lose the ability to have. So, in those times a lot of our effort just went in getting access to authentic good quality data. Today, you don’t spend any time. Yeah. Data is available at a click of a button, right? So you’re spending more time analyzing that data or thinking about businesses. Uh but we had to spend a lot of time just getting access to data at that point in time. And also you know, how do you how do you understand the vision of the founders, right? I mean some businesses were very accessible. Uh some businesses were not some some managements were not very accessible, right? And we had to travel far and wide. I mean we would go to if we if we had to study about Ramco Cements, we would travel all the way in a train to Chennai from there go to Rajapalayam and and attend the annual shareholder meeting of Ramco Industries and and then you started to meet lot of uh you know, good investors who are also doing the same thing. They would you know, you would meet new people, you would start interacting with them and then you start learning. So it was it was it was a different era, you know, and and uh just like today, even back then uh you know, it we used to collaborate and uh there were so many other smart investors who were there. Uh you know, Durgesh Shah, Nimish Bhai, uh Vallabh Bhai, Rakesh Jhunjhunwala, Radha Kishan Ji, right? And and all these people were legendary investors. And if we ever got a chance to just sit next to them and hear what they had to say, that itself was like somebody reading the Gita or the Bible to you. That’s so true. You know, because I was sharing with you that watching Mr. Ramesh Damani and Mr. Rakesh Jhunjhunwala on TV is how I got started in public equities and you know, I named the show The India Opportunity and I get it from RJ’s straight, right? Because there was no there’s been no bigger believer in the India opportunity compared to him in my opinion in the public markets for sure. Absolutely. I mean, I think a lot of the things things that he had envisioned and said are coming true today. Right? Nobody believed that Indian investors will invest in equities. Mhm. Uh you know, now the whole SIP revolution that we are seeing, the amount of uh household wealth that is coming to equities. Uh I mean, he saw that many, many years ago. Any favorite stories or memories that you would like to share? Uh about him? Yeah. Yeah, I mean, there are many. Uh there are many. Uh and uh I would I mean, I think that you know, his one-liners were had lot of wisdom in them, right? And uh like when people used to say, uh you know, Kab aayenge? You know, like today, for example, a lot of people ask a question, “When will the FIIs come?” And in this And if somebody would ask him, he would say, “Agar ladki sundar hai to sab aayenge.” You know? And obviously, uh you know, that sundar ladki was India and the India opportunity, right? So, he always believed that as Warren Buffett used to say, “Don’t bet against the US.” Mhm. And he had a similar view that don’t bet against India, believe in India. And uh specially at that time, I you know, uh lot of the interactions were very interesting because lot of the so-called very well-educated Indians who went abroad and studied abroad and worked with foreign institutions would come and you know, speak very crisp English and say, “Oh, this is the problem with India.” And you know, we and and they would talk about, you know, 10 things that are not right with India. Mhm. And he would counter it with his insight and wisdom. And he used to always say that India is a runner without shoes. Mhm. And just imagine when India gets shoes, how fast it can run, right? So, I think the innate belief that there are structural factors why India will do well. Yeah. He was able to see and recognize that. When most people were talking about the half glass empty, he would talk about the half glass But having said that, it’s not that he was you know, he was a realist. And one of the big lessons that we have learned from him is that nobody is bigger than the market. Mhm. Right? How big one here as they used to say that price is the ultimate arbiter of truth. And you may have whatever belief and conviction. It is finally, you know, nobody is bigger than Mr. Market. Mhm. And therefore, the the fact that in this business, you know, humility is so very important. Um Uh you and and you know, in every sentence I’m sure if you read or heard a lot of his interviews, he would say “This is what my belief is.” And he would say it with great conviction. But he would add one thing which he said, “But I have the right to be wrong.” Yeah. Always. Every interview. Every interview. And what did that mean? It was like a disclaimer that you see in in every financial services ad. But he really meant it. That this is my view. This is my conviction. But you know, I could be wrong. And that you have to be adaptable. There is a very fine line between being having a high conviction and being obstinate. What he was not was he was he was he had high conviction but he was not obstinate. So, I think these are very simple but very profound principles of uh you know, how you behave in the stock market and how you can’t get arrogant about uh the knowledge that you have that nobody no individual person however great he may be uh is bigger than the market because the market cuts everybody down to size, right? So, we learned all of this and you know, never try to go against the wisdom of the market. Um so, I think not one but there were many gems of wisdom that we learned sitting next to him. Mhm. Uh you know, hearing him uh trying to understand uh uh most people were interested in knowing what he bought. Yeah. We were interested in knowing why he bought, right? Because that was more important. thought was truly exceptional. I remember him making a case for PSU banks back in 2018-19 is when you know, he would come on TV and uh you know, keep talking about it. That’s when I bought into it. So, and I have him to thank for it for sure. But the reasons that he would give about you know, investing in that story and at that time you know, stocks I wouldn’t name stocks but you know, they he was comparing the PSU banks to say the privately held banks and talking about how some of the the same assets had been built in PSU banks and were the valuation mismatch, right? Correct. And when you understood the rationale and the thinking behind it, you would be like, yeah, this is an obvious thing. When you know, you needed to hear from his perspective to realize that. Yeah, I mean, you know, he he had he had an amazing sense uh of of value, right? And he was not contrarian for the sake of being contrarian, but he was never swayed by the narrative of the day. Yeah. You know, and like as you rightly said, there was a day and time when everybody despised, like public sector was oh, that’s like a no-go for all of us, right? And even today, a lot of people would come and say, “I don’t invest in PSUs.” Yeah. But uh you know, I think he proved that wrong. Even even somebody like a Ramesh Damani, right? I mean, he he picked some of the best PSUs when they were dirt cheap, right? And they were able to see value with a very different lens that how not to get caught up in these narratives that public sector can do no good, that they cannot compete. Yeah. Uh and and they were able to see things very differently and not get caught up in uh in in narratives. And I think that was their strength. We’ll talk about narratives and the whole narrative that is ongoing right now. But you know, I just want you to take you back again to the IPOs which were happening of say that time like Bajaj Finance you mentioned, Reliance you mentioned. So, what was the sentiment like at that time? Because you know, you were talking about how Mr. Dhirubhai Ambani was seen as a hero at that time and he was considered to be a god. Uh can you talk to us about those IPOs? And then I would want to compare it to IPOs of today’s time. No, I think I think Dhirubhai Ambani uh understood the power of the retail investor, right? I think one of the constraints that a lot of Indian entrepreneurs of those time was how do you get access to capital? Mhm. Right? I mean, obviously you had the old business houses who were uh who were there around the Tatas, uh many of the Birla companies were listed at those points in time. And uh uh you know, as you know, Dhirubhai was very ambitious. Right? But you need to back up your ambition with money. Who’s going to give him the money to build uh you know, he had the vision to build world-class plants of a scale and size which was unheard of at that point in time. And he realized that look, if I go to a bank or if I, you know, I’m I’m not so well known as some of the very well-established groups of that time. And he said that I want to disintermediate this. I want to go and talk directly to the retail investor. I want to give my vision to the retail investor. And uh and it was the collective strength of many small investors Mhm. which is when he raised money in the IPO. And he realized that if he made money for them, they would be a consistent source of capital for him. Right? So, he thought very differently. Many promoters of that time were not very minority shareholder friendly. Right? So, they uh you know, they they would they would only think about themselves. Right? Taking money out of the company, you know, uh and I’m not saying everybody was like that. There were very honest groups also. But nobody thought about the well-being of the retail investor and uh and the fact that that was a big harnessing the power of one investor, even if he invested in 10 shares or 100 shares and the collective strength of that what it could do to his vision and finances vision. I think that he brought that revolution, right? So, yeah, I mean in those days again, you know, IPOs were a way to participate in many good companies and I think India today is unique that we have the largest number of MNCs listed in India. And that was thanks to George Fernandes in 1978 where he forced many of the MNCs that either you have to get out of India or you have to list your businesses. And that’s why today we are fortunate that we we have, you know, we can invest in a Glaxo or a Lever or an ABB or a Siemens. Many of these multi or a 3M, many of these multinationals are not listed. They’re only listed in their parent jurisdictions or countries. They’re not listed here. But we got the ability Indian invest retail investors got the ability to invest in these great franchises, right? So, I think that was a revolution that opened up the doors for IPOs that meant that Indian entrepreneurs could come and raise risk capital. But it was still I would say a preserve of the few, right? Because it was not easy to to go IPO in in in those times, right? And India has always been a capital scarce country. I think that is changing today, right? That today capital is available. There is domestic savings that is available today. Family offices, HNIs are funding a good idea. If there is a good idea, people are willing to provide capital. We have a very flourishing start-up VC private equity ecosystem alongside public markets. So today I think entrepreneurs one thing that has changed back then and today you had to have credibility. You had to have some standing to be able to raise capital. Dhirubhai changed that. Today I think if there is a good idea, capital is available. But let’s talk about the IPOs of today because you know like I think in 2024 India was seen as the country which had the maximum number of IPOs. And I think since then there have been so many new age companies that have listed and you know obviously the market is expanding. Some of them are coming at say very high PE multiples like 100 plus 200 plus even right? And a lot of market veterans keep saying that you know these are the companies that will possibly not be good returners for shareholders. Or some are in the camp of like high growth high momentum and these are the companies will be the profit generators and free cash flow generators of this generation. How what is your thinking about you know when you’re analyzing some of these IPOs? How do you think about that? See I think people are again you know uh creating sort of a camp that says that uh all of new age is good or bad, right? Uh whether it is new age and I used to joke in the office that eventually if these companies don’t make profits they will go into the stone age, right? Uh As it has happened for so many companies that have come and gone. I think I okay. So to be fair, to be fair um see first of all, the basic principles of business will never change. That eventually, if a business cannot earn profits or cash flows Mhm. and provide a healthy return on the capital that is invested in the business, uh, there is no scope for value creation. There will only be value destruction. Mhm. Right? The only difference today is that um, and this was a model which, in a sense, came from Silicon Valley, right? Where uh, many investors said, “Look, don’t bother about near-term profitability. Mhm. Here is capital and scale the business as fast as you can. And once you achieve scale, scale will give you profitability. Yeah. Right? So, beyond the point, operating leverage will kick in. But, that didn’t mean that you fund a business which can never achieve profitability. Mhm. So, I think when you look at the new-age IPOs, you need to differentiate and say, “Okay, the business is not profitable today, but I can understand that inherently the business can be profitable, right?” And I think today’s entrepreneurs, in some of the businesses, are willing to say that I am willing to spend up front to acquire a customer Mhm. and to achieve scale. And once I have a certain scale and dominance, then I will start charging for my product or service. The fact of the matter is that you can’t do anything for free forever. Yeah. Right? So, I think in some models, you are spending everything up front. The good old way way would be that you spend slowly and steadily. You want to be profitable from day one. Mhm. The only difference is that it takes a long time for you to scale the business, right? So, you are trying to arbitrage for time. Yeah. Are you willing to spend disproportionately today to build the scale? But, what is important then to ask about these businesses that is the customer willing to pay for that service or product? Right? So, whether it was when e-commerce became the rage and people started giving deep discounts and free delivery, right? What was that? That was an investment in just acquiring the customer. Yeah. Right? And the Indian customer is very smart. Till the discounts were there and the delivery was free, he came. The day the discounts went away, the customer went away. If you are building a business like that, that’s not a business. Means there’s no loyalty inherent. There’s no loyalty. And today, for example, if you look at some of the food delivery business, let’s take an example of Zomato, right? They also started in that manner and they said, you know, all delivery is free. Mhm. Then, they started to charge platform fees. Started with 2 rupees, then it moved to 5 rupees, then it went to 8 rupees, then it went to 10 rupees. And if you were able to uh And the customer was still using your service by paying 10 rupees. And if earning that money, you were you were you can prove that you can earn profits and cash flows, then that’s a real business, right? So, I think that in assessing these new age businesses, you need to understand that a how much is the entrepreneur willing to spend or burn money today to acquire? And do you believe genuinely that after a certain point in time this business will make money and cash flows? Mhm. And therefore, what are you willing to pay for it? And because you can’t see P&L and cash flows on day one, it’s a loss-making business. So, a lot of people And And it’s fair. Like some people have a framework which says that I will not buy a loss-making business. I will wait. Let it become profitable, and then if it makes sense, I would buy. But there are several investors who are willing to take the bet by saying that I am okay to invest in the business. Now, let me give you It’s the same example of Zomato, right? Zomato, I think, went IPO at 75. The stock ran up to 140. And then at one fine day they decided that they wanted to buy Blinkit, Yeah. which was again another loss-making business. And the stock fell to 45-50 rupees. Yeah. Some of our friends bought it at 40. I also bought it. We bought it at that time, right? And it was a loss-making business even at that point in time. But when we looked at the overall market cap versus the overall opportunity that was there, and the fact that everybody was so negative, right? Uh maybe there is always a price at which something makes sense. So, I would say that it becomes very difficult when you are exposed to businesses which are not making money today. Yeah. And how do you value them, right? And whether are you in some Lala Land because the P’s don’t make any sense. Because the P If the earnings are not there, there is no P. It’s infinite, right? And how do you pay for a business like that? So, there is a little bit of leap of faith that you have to take. And I think that I don’t want to brush every business by saying that you have to loss making it or I will not invest. But at the same time we have to be cognizant that the investors won’t give it a long runway. Mhm. Investors give do not give a long runway to any business. Which is what is happening today, let’s say with the AI team, right? So initially everybody bid up stock prices because everybody was putting down billions of dollars on capex. Then comes a time when investors start asking a question, okay, you’re putting down billions of dollars of capex, what is the return you’re going to generate on this capex, right? And if the investors are not confident that you can generate an economic return on that capex, the value destruction story starts. Yeah. So it’s no different. It has happened through every cycle. It’s just that today there are a set of investors who are willing to bet by saying, I am not willing to look at near-term profitability. Mhm. If you can achieve scale and unit economics, then that dominance itself would mean that at some point in time you will be able to make a lot of money. Mhm. And I think investors who can judge that can invest. And investors who believe that it is very difficult for them to judge, you know, whether scale will indeed bring profitability, whether the company will earn a handsome return on capital, I think they should stay away. Mhm. As a rule, just as a follow-up to that, since you said that you know, around 40, 45 you ended up buying Zomato, right? Um at that point what changed in terms of your thinking? Because if at 70 or at 100 it’s very expensive, what made you think that you know, at 40, 45 it was a good idea? you have to look at the overall market cap of the company. It’s not the stock price. I mean, it’s the it’s the entire value of the business, right? And you had to believe that is food delivery going to be Nobody ascribed a value to quick commerce. Everybody thought that you know, who will buy Who will pay for 10-minutes delivery? Everybody plans. Itna kya jaldi hai? 10 minute mein dega to, you know, is that even a service, right? But a lot of people have been proven wrong that quick, you know, 10-minute delivery is indeed value because for some kind of uh things that you you you don’t want to plan for it anymore now because it is available, right? So, again, we we still have to uh we’ve still not come to the fact whether quick so, you know, QC will eventually will be as profitable Yeah, let’s talk about that because that was my next question. How are you looking at quick commerce? Because, you know, it is a very competitive industry. A lot of billions of dollars are being poured into it. Uh there are many competitors emerging. Even the e-commerce players are launching their own quick commerce verticals. So, it is the competitive intensity in this industry is very high. So, what happens with this kind of environment? It’s not new again. Uh you know, it is no different than let’s say when telecom industry was opened up to the private sector in India. It was a big opportunity. You had to wait for a telephone connection. So, I think what happens and obviously the opportunity was big. And when the opportunity is big, everybody wants to take a shot at it, right? Because everybody thinks that there is an opportunity. So, everybody puts money into that business. But eventually, we all know that you know, was the telecom business a profitable business? Yes, today it is. But it has taken a good two decades of very happy hap- you know very large capital intensity in this business and finally it’s two and a half players who have survived the game, right? And many many fell by the wayside. Mhm. So uh again, like there may be many industries where eventually uh I think is quick commerce going to survive? The answer is yes. Does it solve a problem? Yes, it does solve a problem because there is a very high level of convenience Mhm. that uh QC brings to it, right? And just imagine that today uh you are able to have so many SKUs in a dark store and you don’t have to provide for elaborate lighting and air conditioning because in a typical store you would need uh you know uh place for customers to move around. You will have to keep your inventory there. You need lighting, you need AC, there is rental cost, there is people cost. And it’s also 24/7, right? And it is yeah. Okay, so so you don’t need that, Mhm. right? So you can have a dark store which can go as high as you can and today with robotics you can stack and with technology uh you know you can you can stack products and that is delivered to you Mhm. uh uh uh at a fraction of a cost, right? And within 10 to 15 minutes. Now, will all products move to that? No, but we are seeing that as people gets used to convenience they don’t want to step out. Yeah. Right? But therefore and and everybody thinks this is a great opportunity because India retailing is a 800 850 billion dollar opportunity. Maybe 15 to 20% of that will be the time for QC. Yeah. least today it could be higher maybe tomorrow. But 20 billion of 800 billion is still a very large number. Right? And therefore, you have many players trying to attack that opportunity. Will everybody survive? I don’t think so. Will they will the competitive intensity be very high as we are seeing today? I think it will be. In the final analysis, there will be in my view two or three dominant players. And I think one thing which is unique about some of these hypergrowth new age industries is and you can see it anywhere globally that the number one player not only gets the disproportionate size of the market, he also gets the disproportionate share of market cap. Yeah. The number two is a real distant number two. And then the number three and then the rest vanish. Right? So, it is very important that uh in this business, you also uh get to a judgment of who is finally going to win in this game. Right? Who has the standing power? Who has the ability to raise capital? Because beyond execution, one of the things in the new age businesses, one of the competitive advantages is ability to raise capital. Mhm. If everybody says I’m sitting with 2 billion dollars in my balance sheet, now come on. Let’s play the game. Right? Not every entrepreneur is able to raise that kind of capital. And whoever raises capital and is able to execute probably has a better chance of making it to the top. Yeah. So, I think you need flawless execution. And you also need the ability to tell your story and raise capital. Mhm. Right? Both are equally important. If you just have one and not the other, this won’t work in a new age industry. And shareholders might not have two decades of patience also, right? To wait for the stock to turn around in one sense. Correct. Absolutely. So, do you think the timeline will be shortened in terms of, you know, seeing the winners emerge faster? Or because, you know, it is the new age tech business, so it can that timeline be condensed? I have seen this across many many many sectors and and I’ve coined my own theory around this, which is which is what I call version 1.0 investing and version 2.0 investing. Tell us more. Right? Version 1.0 investing is when you invest in a blue sky situation, right? You you only you know, everybody is enamored by the sheer size of the opportunity and what it can do. Mhm. Right? It’s like what people think about AI. AI will change the world, right? And you hear the best of the best technology companies putting down billions of dollars in AI and you think, “Wow, like this is going to change the world, right?” And in version 1.0, anything to do with AI does well initially, right? So, you just play the broad trend. And this has happened not only in high-tech, it’s even happened in in in very simple hardcore physical businesses. There was a time when retailing Mhm. organized retailing was looked upon Oh, India may organized retailing is like forever version 1.0. I remember companies used to say, “I’m going to add that this many million square feet of retail space and the stock price would go up.” Nobody cared, “Okay, are you making cash flows? Uh what are your margins? What are your inventory turns? What are your inventory loss ratios, right?” All the good things that determine the value of a good retail business, Yeah. nobody cared about it. Everybody was playing the big white space that is available in retailing. This is what I call as version 1.0 investing and believe you me it has happened in every new sector. It happened in software. So before ‘97, ‘98, anything you tag the name software behind a company and the stock price would go up. Then at some point in time reality sets in. Right? People start asking hard questions. Where is your profitability? Where is your cash flow? What is your return on capital? Right? And then you know that something happens in the macro environment and the whole sector crashes. Yeah. Like it happened in the tech bust. And then the dust settles and then version 2.0 happens. In version 2.0 it’s really the high quality survivors who actually build enduring value. Right? Because they are the ones who execute. They are the ones who have the real business model. They are the ones where can who can tell the investors that I’m actually making real cash flows. Right? Where execution matters, where the tiny things that create value matters. And every cycle every industry goes through that. And the same will happen with AI as well. Right? Because the opportunity is so big. Sometimes a lot of people will say that I cannot be left behind in that opportunity. I have to bet. Yeah. So every tech company or the mega tech company worth its salt in the US cannot be seen not being participating in the AI race. Because if not, the investors will hammer you because they’ll say there is no AI play. This is the next big thing. You you you are not positioned for this, right? So, everybody today is putting down money. But, will everybody win the game? I don’t think so. Yeah. Lot of money will be lost. Lot of value will be lost. But, the one two people who will survive will make it. Mhm. And I can give you that example. Let’s take the EV two-wheeler industry. Right? You had the traditional players TVS, Bajaj, and then you suddenly had new entrepreneurs who came from nowhere. Ola came. Ather Ather came. Right? And at one point in time, Ola took a 45% market share. Yeah. They were leading in the category. leading in the category, right? And you know what price the IPO went at, right? But, there is this business demands certain capabilities. You know? So, what is your after sales capability? What is the quality of your product? What is the reliability of your product, right? The oldies were a little late, but they understood the business. They know what the customer requires. It’s beyond just a great-looking product at a cheap price. That’s That may attract early consumers. Mhm. But, over a period of time, the word of mouth goes, “Are they they they, you know, he’s got those scooter jal jata hai. He’s got those after-sales service is not there.” Yeah. And look at where how they lost market share. Right? But, an Ather, for example, has done a damn good job. Mhm. So, what happens is that in a new industry, there are some old players who know the game, but sometimes they are slow. And then you have completely new players who come from nowhere and disrupt the industry. Mhm. That’s what Tesla did for the EV industry. He came from nowhere. Yeah. When you had the traditional GM, Ford, Toyota, you know, Volkswagen. I mean, these are car companies which have been around for 20, 30, 40, 50 years. Or even BYD, for example, right? Or BYD and Tesla, they came from nowhere. And they disrupted the industry, and they took a 10% market share. And BYD now even more, right? And And therefore, everybody A lot of people will take a shot at it, but very few people will survive. Mhm. Right? And therefore, it is very important to understand. The same thing, I’ll give you a very real-life example. What did Patanjali do? He came in as a disruptor. Mhm. Right? Okay, you know, products based on In- Indian Ayurveda. Indian culture and science. Right? And And suddenly, the toothpaste market was completely shaken up. And it forced all the existing guys, whether it was Dabur, Lever, Colgate. Somebody started with Shakti, somebody started. Why? Because he came from nowhere. He disrupted the industry. He took away 10% market share. Right? But then, physics caught up with Patanjali also. Yeah. Because you still have to, you know, have the quality of the product. You still have to have distribution capabilities. You still have to know how to manage scale. Mhm. So, eventually, reality kicks in. Right? So, in any new industry, you will find a few disruptors who come from nowhere. Yeah. They completely up- disrupt the industry. And then, investors are confused. Okay, some people think this is the next big thing. Uh And how do I now evaluate this business? How do I evaluate the industry? And that’s where the challenge and the opportunity in investing is also, right? So, there is constant disruption that is happening in every sector. Yeah. Right? Look at what Uday Kotak said about a UPI. Mhm. For example, nobody makes money on UPI, right? I mean, it’s a loss-making proposition. So, the traditional banks were never serious about launching UPI. But, whoever launched UPI and got customers, I I uh use an analogy that UPI is like building a toll road on which you won’t get any toll. Yeah. But, what happens? Because it was a toll road which had no toll, lot of traffic came. Mhm. But, once the traffic comes, somebody will stop and have a coffee. Somebody will stop and fill petrol. Platforms are sticky. And and and you know, do something. And you make money on the coffee, you make money on the petrol, you make money on providing services on the toll. You don’t get toll. Mhm. But, you get ancillary revenue on the toll. And Uday Kotak himself said that Indian private banks lost out the UPI game because we always thought traditionally is for the person in here. But, today a PhonePe and a Paytm have done a phenomenal job. Mhm. That they said may road construct karunga mujhe toll mat dena but traffic aayega to I will cross sell other services on the toll. That’s such a grounding way to think about it. You know, you’re as you were talking about it, I was reminded of this book called Market Returns by Edward. Uh you know, he talks about market cycles as well. Like, you know, first the opportunity is spotted, then heavy capex and investments happen in that industry, then you know, it goes through then there is overall first bullishness, then bearishness about the performance overall, and then massive consolidation. I think this is exactly what you just described. Typical market cycle that happens across sectors. But, you know, since now we’re talking about, you know, investing at the right time or you choosing whenever to decide when you want to ride on the journey, you know, you work with family offices. They also have started taking bets in, say, the private space. Sometimes, I know family offices who mostly want to invest, say, in the pre-seed or seed stages, right? Very very early on in their journey. Some are more disciplined. They’ll go and at like, say, Series A, Series B. But, in these kind of businesses where you really don’t know what the story will how the story will play out. It could take 10 years. It could take 20 years. It could take forever or it could go nowhere as well, right? There are so many companies that have become zombie companies after, you know, seeing some success, but now no one even talks about them anymore. So, what is a good time to exit or get out of that opportunity? So, we can take Zomato’s case like you were talking about or what would the signals be in your mind to figure out when one should exit an opportunity? Again, you know, exiting an opportunity in public listed markets is very different than, you know, exiting an opportunity in private equity or startup investing or growth investing, right? There is no exit. Let’s address both since I know you do a bit of both. So, Uh well, I’ll take the first one which is relatively simple but not easy is that in public markets, right? When do you when do you exit in public markets? Um again, there is no there is no standard formula, right? I think what we have at least I have observed over over the last so many years is that uh value you know, most of the time is spent on predicting earnings. Mhm. And that also is fraught with lot of uncertainty because you it’s it’s it’s not very easy to even predict Yeah. earnings. But a lot of effort goes into predicting earnings. Uh the real fun is in trying to assess the value of the business. The valuation is a more ephemeral concept. You cannot box it into a uh formula. Hmm. Right? So, there is no right and wrong PE of a business. Uh so, there are no absolute truths in valuation. It’s a relative truth. What you want to pay for a business depends on growth, return on capital, and capital in intensity of a business, and longevity of growth. Okay? You have to look at each of these dimensions, right? If you have let’s say take a cement business for example. Now, everybody knows the metrics extremely well because it’s a business which is fairly relatively simple to analyze. You know what the value drivers are. Uh and therefore price discovery is relatively easy. Hmm. Right? And therefore, you know that this is the broad range in which most companies will uh will trade it, right? So, the best of the best will have a premium valuation. Then there will be the middlers, and then there are the really bad ones, right? And you know why the best guy gets So, the way I look at it is that in in in many industries, it’s very important to understand who is that best guy. Who’s the Amitabh Bachchan of the industry or the Shah Rukh Khan of the industry? There is a reason why he’s Amitabh Bachchan, right? And you then get a sense that okay, a great business growing at this rate producing this profitability, this return on capital, the collective wisdom of the market has decided that this company will trade at this valuation. Obviously, it has to have some length of history Mhm. uh to say that it is the collective wisdom of the market which has decided that a business like this will be get this value. And then when you’re evaluating another business, you say okay, what will this business be valued at if the best in the industry is valued at this, right? And then you say no, but my company is growing faster than the best in the industry, margins are faster than this, and you could argue that will I get a higher multiple than the best of the best, right? So, valuations are both absolute and relative, and that’s what makes it very challenging. So, I wish I could give an answer. It will probably take uh you know, days to take many examples to explain how do you value a business. But I think that when you exit a business is when two or three things conditions are in play. One is where you believe that with reasonable visibility, not like a 10-year view on the business, right? With reasonable visibility over the next few years, can you justify a business, what are you paying per unit of growth? Mhm. Right? So, not just the PE, but the PEG of a business. Also, are you Do you believe that the business will be as attractive or more attractive than what it is today? So, is the return capital or the ROE of the business improving or deteriorating? Yeah. And sometimes that happens when the competitive intensity increases. You may be a great business. Like it happened in the case of Asian Paints. Yeah. Great business, superb management team. Long track record of superb execution, but people didn’t make money for 5 years. Why? Because the competitive intensity increased. Until it is settled key whether the new competitors will be able to come and take market share till when will returns be sub optimal until you settle that right? There is no point of buying the business at a very high valuation because now things have changed. Mhm. You could argue that you could still uh hold or buy Asian Paints as long as the competitive intensity had not increased, but once the competitive intensity increases, there is a new variable that has been put into play. And you have to start assessing the business. What is the risk reward? Mhm. Right? What if these guys the new guy comes and plays a price game for the next 3 years? Yeah. Right? What happens to the business then? Not that the business becomes bad, but your returns will evaporate, right? Mhm. So, the day you think that the competitive incentive intensity is increasing which may hamper the profitability of a business, I think it is a time to seriously relook at the business. It could you could either trim or you could exit. You could wait for things to settle down and maybe the markets will give you a great chance to come back in. Mhm. If you are doing version 1.0 investing as I explained where you are just it’s blue sky, nobody knows anything. Like you you don’t have a real handle of how to value a business, right? You are basically playing momentum. Yeah. You can either choose not to do that. Right? But if you are doing that, you have to be really careful. And it’s not very easy. You have to exit when the music stops because then everybody will try to exit through the same door. Mhm. The simple rule of thumb that some of the wisest people in our industry have told us is that when you are doing version 1.0 investing, you don’t know how long this party is going to last. If a stock corrects 20 to 25% from the peak, ask no questions, take your money, or cut your losses and go home. Mhm. Right? Again, you require that level of discipline if you want to do that. So, I think as I said that it depends on the maturity of the business. Right? So, the beauty about the listed markets is that at least there is an option for exiting. And that doesn’t mean that you have to exit. I mean, we have invested in businesses for 15, 15, 20, 20 years. Right? But we believe that you know, it still makes sense to hold on to these businesses because they will keep compounding. Yeah. Maybe initially the rate of compounding is very high because the business is usually not so well discovered. Everybody doesn’t know the story. Over a period of time, once the company starts to deliver numbers consistently, everybody’s attention will come on to it. And then there is over ownership. So, that’s another point in time when there is too much of positivity, and everybody owns it, and then you have a disappointment. You will see a very serious reaction to it. Right? And therefore, I think that valuation cannot be seen in absolute terms. It has to be seen in the context. Yeah. And those contexts are varying contexts. What is the competitive intensity context? Mhm. How well owned is the company? Is everybody bought into the story and everybody is looking at the same uh you know, great future about the business and if there is a disappointment, what will happen? Mhm. Right? Are there any comparables in the business? Sometimes what happens is that there is a new company in a in a relatively new business, but that’s the only company that is listed. Everybody will pile on to that business and the valuation that the business will command is very high. Yeah. Looking at those valuations, other people running similar businesses will also go IPO. Because they will say, “Hey, is going to be not be right right to maybe public That’s what happens in private markets now because we take benchmarks from the public space. Yeah, and that’s another very risky way of looking at things because what happens is that once you have a choice, earlier you had only one company in that high growth business or a very attractive business. Mhm. Tomorrow, uh this kind of valuation will create more choices and supply. What happens when four businesses like this are listed? Capital will get uh allocated across this because somebody will take a call, “You know what? This is a better business and I’m getting a similarly great business at a cheaper valuation, so let me sell this and buy this.” And that’s how a derating of that business happens, right? So, when you sell a business is not a very simplistic mathematical model that you can put it. Give me a bundle P mail longer or challenge P mail better. That’s not how it works, right? You have to look at what are the relative choices you have. And if all the relative choices are really bad, then maybe that one or two businesses will continue to command a premium. What is the intensity? What is the longevity of growth? Is your business liable to be disrupted? Mhm. Right? Is there hyper competitiveness that will happen in the business. And therefore, when you put all of that into your framework, then you have to take the best judgment call. And finally, the best arbiter of that is the market. Mhm. If you whatever you think, if the market thinks differently for a reasonably long period I’m not talking very short periods of time, then you need to question your own hypothesis because Mr. Market is always right. That’s true. And just to go take the same analogy into the private space. You know, I I know a lot of smart investors and family offices are now directly cutting checks and investing in private equity, right? I think some of them are doing it you know, the right way. They know that they are they are taking See, when you invest in private equity, you take two kinds of risk. One is the execution risk. Mhm. And the second is illiquidity risk. When I go wrong in in a listed market company, I can I have the exit of choice. I can sell that business and reallocate the money somewhere else. Mhm. I’m not stuck with that company. What do you do when the company is unlisted? Who do you sell it to? And if something is going wrong, why will somebody else buy that stock from you? Yeah. So, what happens is that you take a significant illiquidity risk. And I have seen that, you know, everything looks good initially. The the space is great. The entrepreneur is good. But we all know that there are always challenges in scaling the business. Mhm. Right? And therefore, what happens, at least what we think is important, is that when you are doing private equity investing, your entry valuations have to be really really attractive Mhm. to compensate for the execution risk and the illiquidity risk. So, you know, trying to have a FOMO of investing because somebody else has invested or you know, you have the only is metal, you know, this guy has invested so I also want to invest. And this FOMO that I will make quick money on listing. I think that’s going to end up very badly. Yeah, like you know, people hear of the 80X 100X returns for one or two companies and they assume that this is what you can expect from I’ll tell you recently like I mean, I know so many HNI and ultra HNI investors and family offices who have invested in NSE. Yeah. Right. But investing in NSE is very different. You don’t have to do a due diligence on the business or the legal due diligence, you know, because you’re taking a broad call on the financialization and the growth of India’s capital markets. So, investing in NSE is very different and I tell a lot of my investors that, you know, there is a certain capability that you need to have to assess the business, to assess the founders, and then also invest at the right valuation and you could still go wrong and it could still take a lot of time. So, I think that and again, I don’t want to uh you know, pass a sweeping judgment, but I think a lot of the uh you know, private investing that is happening may land up in tears if you do not uh have certain guardrails. And there is only that much because there is only that much that, you know, the the the the future is so uncertain. You don’t know. Your current hypothesis may may not be true 2 years down the line. What do you do? You don’t have an exit route. Yeah. And therefore the only route available to you your only safety valve is the valuation at which you invest. Because if you invested at a reasonable valuation, you can stay in the game long enough. You can go through the vicissitudes of the business, you know, that challenges that might come up. Uh execution delays that can happen. A lot of things can go wrong, right? So everybody thinks pre-IPO and then IPO may I will make 3x and 4x the money. It’s easier said than done. I’m glad you brought up the NSE example because you know, Mr. Sanjoy Bhattacharya, who I hosted on the show back in Jan 2025, he came and he he spoke about NSE. And I think that time around the price must have been around 1400, 1500, right? And yesterday I got a message from a friend saying that, you know, he had invested in NSE saying that, you know, around 2100 must be the current price. That, you know, it’s rallied up so much. So should I start trimming my position, right? And he was of the opinion that he should hold it for long term because it’s a great business and duopoly and all those things, right? So how would you assess a business like NSE today in today’s time? No, I think it’s you know, it is still one of the leading exchanges of India, but I think uh the investors who have invested in the last very last leg have all done it with a sense of FOMO. Yeah, because the IPO is right. Thinking that the IPO will happen, uh you know, again, an IPO doesn’t guarantee you that you have to make money, right? Uh and and I wish everybody makes money. I mean, I think we have also invested But you must have gotten in way But but I think we made more money investing in BSE than investing in NSE, right? Because Uh, at the margin I think BSE has executed phenomenally well. They’ve taken away market share from NSE uh, in the futures and options market. Um, and people have been perpetually waiting for an IPO for NSE. You know, not till then we thought there was a great way to make money uh, on BSE. But, you know, that apart, I think it’s a great company. Uh, you know, I think it is like betting on the future of India. You can’t go wrong. But, just because it is going to go IPO, you buy it any price, that’s not going to be a formula to make money, right? I think the once it goes IPO, uh, you know, like every other business, uh, the collective wisdom of the market will decide what the valuation of the business should be. That’s true. You know, I want to go back to a point that you made earlier. Uh, we were talking about Asian Paints and some company you said that you held some companies for 15-20 years, right? Uh, taking Asian Paints example, I think, you know, for the first Bajaj Finance, 15 years of holding. Yes, we’ll talk about that. But, you know, for Asian Paints, I think first 25 years, I think 23 years, it beat the market returns, right? And then for the last 5-7 years, it hasn’t delivered and performed. But, uh, like going back to say Bajaj Finance, another darling company, another company that pretty much everyone owns if they are in the Indian stock markets, every fund owns it. But, you know, the company’s been talking about how they are experiencing a slowdown. I think yesterday they announced their quarterly results as well. So, they are seeing like a shrinkage in their PAT overall, right? So, like how do you assess an opportunity that, you know, this is the Amitabh Bachchan of the space and it’ll continue for another 10-20 uh, years. It is still the Amitabh Bachchan of the space, but it is an aging Amitabh Bachchan. Uh, but it can now do character roles. Uh, you know, I mean, jokes apart, I think uh, see, there was a time when uh, you know uh, Bajaj was growing profits at 40 45% compound with very attractive return ratios. And I think it is one of those rare feats of great compounding. Yeah. And flawless execution. So much driven focused entrepreneurs who have built that business. Not too many businesses like that. Probably with the accession of HDFC Bank when Aditya Puri was there. And I think during his time he they also executed. But not at the speed with which Bajaj executed. Mhm. And they broke the glass ceiling on valuations, right? Because at a point in time it was trading at eight times price to book. Now obviously you can’t keep growing at 40% a year because you will become larger than the GDP of a country if you continue to do that. And I think now growth has settled at a more 18 20% kind of a range. And therefore I think some derating of valuations had to happen. So I think when you come across that you have to be very clear A what valuations are you. So if you end up then buying Bajaj Finance at eight times price to book you have to be very clear that what will happen to the valuation when growth slows down or becomes a more mature level of growth, right? 18 20% per se is not a bad growth at all. Of course. there are I would say there are a handful of four five companies in the Nifty who can even attempt to grow consistently above 15%. Most of them are struggling to grow single digits today. Right? So I think it’s still a great franchise. I think there is still lot of headroom to grow. But now it has achieved scale. And in the lending business if you grow mindlessly you’re actually taking undue risk and I don’t think this is a management who will still want to grow at 40% at this scale and size. So I think it is quite sensible for them to moderate. But once you moderate your growth and the competitive intensity increases and as I said when there were very few N- NBFCs like Bajaj Finance there was a super premium multiple not only for the growth and the return on equity but also there was a lack of choices. Mhm. But today let’s say for example you have Cholamandalam which is equally executing superbly well, great corporate governance, great execution. Uh so today people have a choice. Right? So what happens when you have only one company which is out executing everybody it will have a disproportionate premium. Yeah. But and Amitabh Bachchan also had a Shah Rukh Khan which came in and then you know people said okay I can watch a Shah Rukh Khan movie too. So I think that therefore we now have to moderate our expectations of returns that you will get from a company you know like holding on to a Bajaj Finance. Right? Because there is always a law of large numbers that kicks in. You know you are now uh 3 and 1/2 4 lakh crore balance sheet. You’re no longer a 30,000 crore balance sheet which can keep compounding at 40%. Right? So now you will have a more mature valuation. And tomorrow if the business has headwinds and and that is why you see that uh you know post COVID uh you know it’s not been a straight line for Bajaj Finance either. Right? I mean if if there has been a slowdown, if the credit costs have picked up, or if there has been a concern on growth, the stock has corrected and probably not given the kind of compounding that it gave pre-COVID. Right? So, every business will go through a cycle where it is in its youth, uh it is growing, and then it matures. And what happens is that because it’s a great business, finally towards the end everybody piles on to it. So, lot of expectations are already built into it. Who’s the next marginal buyer? Because everybody who was not a buyer has got converted. Yeah. You know? And then the economics of the valuation, you know, the the whole dimension of valuation changes. When everybody’s in the story, and then something doesn’t work out in the story, and then there is disappointment, and then somebody will get off the train. Yeah. And somebody will continue to still ride in the That’s true and so beautifully put as well, because you know, like it changed the nature of business as well, right? Like from financing Bajaj Auto’s two-wheelers to now actually betting on financialization of India overall, looking at Yeah, I mean, as you scale, you can’t keep growing your unsecured book. Yeah. You know, you start have to do some secured lending. So, you have to have a basket of revenue lines. Some will be high growth, high margin businesses. Some will be relatively low growth, but you know, more secured, less risky, but less profitable. And now you have to manage a uh portfolio of revenue streams, and still in the end delivered deliver a good return on equity. I still feel the kind of stuff that they have done on AI to reduce their, you know, costs and bring efficiency. I think they’re way ahead of many other people. And for debt collection and all these Yeah, I mean there there are several firsts and I still feel even today when I meet them, you know, the the management is as focused and as hungry as it was 10 years ago. Very difficult to find those kind of management teams. But having said all of this, we now have to reconcile with the fact that those hyper growth years of Bajaj Finance are behind us. And it is going to be a much more mature compounding story. True. And then, you know, when you think about the same analogy, how do you think about finding Ranbir Kapoor and Ranbir Singh of that generation? For that, you have to watch a lot of movies. And you’ve you’ve seen the story play out so many times in almost 30 years plus. Yeah, so it’s very interesting that you say that, right? I mean, so what happens is that see when like for example now I have experienced investing in Bajaj Finance. And uh there are a few things that are required to find the next uh Ranbir uh Kapoor or, you know, or Ranbir Singh uh is that a there has to be a large opportunity for a business to grow. Because without an opportunity, you know, there is there is no case for business, right? And now you know that what a good business what are the right attributes of a good business, right? So, what you can do is you can find sectors and areas which have significant opportunity to grow. And then you find the right person with the right attributes. And then you have to bet with the hypothesis key area is the sector is great. The uh the attributes of the founder are great, the attractiveness of the business is great, and then you have to bet that the execution will be good. So, I use a simple analogy, right? If you want to eat a great dish, what is required? You need good ingredients, and you need a good chef. Very high probability that the dish will taste very well, right? You can’t do it if your ingredients are not good. Neither will the dish come out to be good if the chef is not good. What I can look for in young companies is the ingredient good? Is the chef good? Then, very high probability that the dish will also be tasty, right? So, you look for the right attributes. But, there are still risks that will be there, right? So, investing in uh you know, I didn’t build my conviction in Bajaj Finance on day one. So, everybody thinks that, you know what? I will analyze a business to death. I will read everything about a business. I will put my spreadsheets. I will create my model. I will look at next 3 years earnings. I will I will do scenario analysis, and then I will bet big money. I will find it at 5 7 PE or Yeah, and I will bet on it, right? It doesn’t work that way. True. Okay? You build conviction. So, you have an original You have a starting hypothesis. As I said, you look for a good business. You You You look for the right uh entrepreneurs. You You You look for the right competitive advantage that a business may have. And then, you have certain assumptions and hypotheses. And then, you bet, and then you watch the company. You know, I use this analogy that investing in small and micro caps is like hiring a person. What do you do when you hire a person? You get a CV? There is everything about the person in a CV, his background, his educational qualifications, his family background, what experience he has, what awards he has won, what are his interests. That’s like me reading up on the company. Everything that is publicly available, I read, I do research, I do chat GPT, I read this report, I read that report. Right? Then what do you do? You call that candidate for an interview. Right? So you start to ask deeper questions. You quiz them. You put them in certain situations. You try to find more. You try to dig deeper. That’s like me going and talking to the MD or the CFO of a company. I’ve read everything about the business, I’ve analyzed everything. Then I want a meeting with the management. I ask them lot of questions. I probe further. I want more answers. Right? Then sometimes they give you a reference. So you call up that other person and say, “Okay, do you know this person? Do you Have you you know, what was it like working for this guy? What are his strengths, weaknesses?” You should try to do an independent check about the person. That’s like me doing what they call in our industry parlance a channel check. So you speak to the competitor, you speak to the supplier, you speak to you know, somebody who may have worked in the company. You try to get more. And then you think you know everything about that person. And you hire that person. The real fun starts after you hire the person. When he or she starts working with you, over time the real character of a person comes out. You know, what kind of a person is he? Very consistent? What does that person do when put under pressure? What happens when there are short deadlines? You know, how does a person react? How does he manage you know, how do they execute? Is Is the person consistent or it is just a flash of brilliance? right? Which is the same thing with a company. You think you know everything about a business because you’ve done all your research and due diligence. Let me tell you, you know only 25% about the business because there are so many blind spots. And the external environment is always evolving. Right? Who knew, for example, COVID would happen? But how did the business react when COVID happened? What are the calls they took? What are the decisions they took? Tells you the character of a business. So, over time when I used to meet Bajaj Finance, and every time I would come out, I would say, “Wow, these guys are four steps ahead. They’ve already thought about things that people are not even thinking about. They are preparing for the worst. They are benchmarking themselves with the best in the industry.” That is when you get the confidence. And when you get that confidence, you bet even more. And even if it means betting at a higher price, you bet more. So, investing sometimes is not a one-point journey. You may invest and then you test your hypothesis. Is it working? You know, what happens to the company in good times, bad times, challenging times? How does the management react? How did they What are the calls they took? What decisions they took? How did they execute? And then when you get the confidence, that’s when you bet big. Right? So, your con So, that judgment is a process. It’s not a one-shot story that you take. We’ve spoken so much about Bajaj Finance. Any other examples that come to mind? No, there are there are you know, there are lots of great businesses, you know, that we’ve invested in which which have done phenomenally well. You know, Varun Beverages is another example of a company that has executed phenomenally well Yeah. over the years. Uh We We We invested in Tata Elxsi. Mhm. Uh you know, which brought very differentiated skill sets to the table uh at a point in time, you know, when when there was a disruption that was happening in the automotive industry and the media and communication industry. Mhm. Right? Tesla came and disrupted uh the global automotive industry and Netflix came and disrupted the the media industry. Yeah. Right? And everybody was scrambling to adapt to that new disruption. And Elxsi was right there in the middle taking advantage of this disruption because they were delivering services to all these people so that they could compete with a Tesla or a Netflix. Uh right? So, I think there are lots of great businesses which have executed year after year after year. Mhm. Uh you know, uh we uh again, all these companies with full disclosure that we own them and our clients own them and we may trade in and out of these businesses, so should not be taken as a recommendation. Um we own another uh you know, very young uh company that we owned 20 years ago. It’s uh it’s it’s in the aerospace business called Dynamatic Technologies, right? Uh from Bangalore. Uh is a classic example of how Indian businesses have transitioned uh from uh so, they started as a hydraulics business. Mhm. And then, when I met them in uh in the in the mid-2000s, I I met them in 2005-6. That time the small car boom was happening in India. And they were using their engineering capabilities, so they moved from hydraulics to start doing auto components for Hyundai and Tata Motors. Right. Right. But back then in a small garage, they were building uh certain aero structures for the Sukhoi fighter aircraft for HAL. They were a contract manufacturer for HAL. And uh the the the founder then, Udayant uh Auto Bias they call him, you know, he had a vision as a kid that he eventually wants to make a full-blown aircraft. Right. And uh well, I mean, today uh it is one of the few aero structure companies in India, which is a single source supplier to Airbus, Boeing, they work with Deutsche Aerospace, Dassault, they work with some of the best of the best OEMs in the in the aerospace and defense area. And there are only three, four companies like that. very few companies, right? But this is a classic example of betting on a very small company Mhm. for 20 years. And the journey has not been very smooth sailing, right? I mean, there’ve been a lot of ups and downs. They made a couple of acquisitions uh right during the global financial crisis, and you know, those took a lot of time to integrate. They uh many of them uh there were a lot of challenges. But I think the grit and determination of that entrepreneur to take the right calls at every stage, do course correction, and move on. Uh and today I think they are at an inflection point where I believe that all the hard work of the last 10, 15, 20 years, I mean, had it been any other company, we would have got exhausted and sold out of it. Yeah, so did you go in and out, or you of times. A couple of times. I mean, mostly in. Yeah. A little bit not too much out, only when it became very euphoric. Sometimes we we we we decided to trim it, but mostly when uh you know uh when people gave up or you know markets were very bad and it’s a very small illiquid company. So you know stocks can become very volatile. But I remember in 2013 you know 14 when when the markets were really bad and the stock literally halved is when we actually added substantially to our position at that point in time. Because I think we believed in the long-term hypothesis and we believed in the entrepreneur and I think we were aptly rewarded, right? So again, I mean like you know there are there are stories that crash and burn and there are stories that eventually you know work out well in the end and pay for your patience and the pain and all the heartburn that you take. So that’s it’s not an easy fairy tale as everybody makes it out to be. Oh you know everybody says you’re you know wow, you know you bought Bajaj Finance in 2010 you’re still holding it, but seldom do people know that at least three four times during this journey the stock corrected 40 50%. And that is the time when doubt seeps in, you know you question yourself. Your LP start questioning you. Your LP start questioning you, right? You know why are you overweight on this stock? You know what do you think is going to happen? And those are really the time when your experience, your market cycles, your gut, your conviction is what differentiates you from somebody else. That’s fascinating and I’m so glad that the audience is understanding so much of how you think. Maybe I know Safir Anand whose book I discovered you in you know wrote a book about the mistakes that market veterans have made. Can do you have some time to talk about some of the mistakes some stories that didn’t play out where you had full conviction or you know some stories where you might have changed your mind. We don’t have to name the companies. Just Oh, yeah, there have been many. Yeah. You know, I mean, there is you know, there is there is never an an an there is never a learning unless you you made mistakes. Uh Yeah, I mean, you know, I I still remember very clearly that there was a point in time, you know, after the whole IT services boom of ‘99 2000 went through and there were a few Indian companies which were trying to become product companies. And I thought Indians are so good at building software, they’re so smart. And you know, my hypothesis was that there will be a few big champions product companies from India that will that will appear, right? Which we’re still hoping for in

for. Though, there are one or two which which did very well. And I still remember that I bet very early on a company called Ramco Systems and they were building an ERP. Right? And they’re still around. I mean, they’re still doing quite okay. But they never scaled up the way we thought that they would scale up. Because, you know, genuinely it’s not about I you know, I think one thing which I realized today, which I didn’t realize back then, it’s not about how sophisticated your product is or how good your technology or product is. It is that large enterprises will never take a risk on betting on you if you are a small company. No matter how high quality or how high-tech your product is. And I remember in those times, you know, we used to oh, this product is even better than Microsoft. And I still remember, maybe Rameshji will remember, and you You how stupid can you be? I was telling Ramesh ji, I was giving him this eloquent pitch about Ramco Systems and I told him, “Sir, Infosys to kuch nahi hai. Matlab, this will be bigger than Infosys.” And like he was, you know, the experienced man that he said, “Oh, truly? Do you think so?” And I was like as a young, you know, analyst and you know, young investor telling him, “Sir, you know, you should look at Ramco Systems. I think this company will is like a breakthrough. This is the next Microsoft from India.” And we bet on it and I mean, again, with all due respect, I think in certain areas the company has done very well in HR, in aerospace, people you know, global they have global customers in aerospace. But you know, it’s so difficult for a small Indian company to get into the big league because selling a product is a whole new ballgame, right? The amount of money that you have to spend on sales, marketing, uh you have to look at not only is your technology and product has to be good, your balance sheet has to be strong and you have to look larger than life, uh you know, and you have to spend millions and millions of dollars attending conferences, investing in high-quality sales people. And Indian companies are still very frugal about all these things, right? So, they were very good at technology, but they never understood how to win the you know, the big game in in the product business. And I think I bet on one or two product companies thinking that, you know, I’m very smart and I will make a lot of money, you know, there was a telecom software company called Subex Systems which I invested in. Uh they did quite well, very well and then, you know, at some point in time because of a wrong capital structure, it crashed and burned. Uh it’s still around in some avatar. It’s been bought over by somebody else. But you know, yeah, I mean, you go wrong all the time. You build uh you know, as I said, you can build a castle in the air, but if you can’t finally build the castle, then it’s all a a pipe dream, right? So, so I think that uh sometimes uh what investing has taught me is that uh we we think that intelligence and knowledge is supreme. It is just one of the ingredients of investing. You know, when sometimes you tend to run ahead of yourself because you think you will go ahead go ahead go ahead go ahead this will happen your hypothesis, you know, you become too self-confident about yourself. But you know, there are reality knocks you down and and and then you have to eat humble pie and say, “Okay, I’m sorry. I’m wrong. I have to course correct.” And maybe my hypothesis was wrong. But then learn from it and then hopefully don’t make the same mistake again. You make a new mistake. You know, before we started recording, we were talking about how, you know, the market sentiment just completely shifts around budget. And I know you don’t like to talk about the budget, so I’m not going to ask you about it. But then, you know, the India-US trade deal was announced. And, you know, from tanking on Sunday to then seeing this immediate rise and rally on Monday, there is this shift of market sentiment that happens and sometimes overnight, sometimes, you know, within 48 hours, which is what’s played out, right? But there are certain sectors which do stand to benefit from, you know, the trade deals that have happened, be it with uh EU or the US. Are there any sectors that you’re particularly bullish on? You know, my view has been that uh uh uh I wouldn’t just go headlong and buy a sector which may seem to be a big beneficiary just because of the trade deal. I look at the trade deal as an enabler. Right? It it creates a uh it creates a favorable environment for the business to grow. Mhm. And that is that that cannot be the only reason why you buy a business, right? So, probably if you like the business and you have not invested because you believe that the US is a large market and uh you know, the trade barrier would mean that that market is shut out to you and now suddenly the market has opened up and therefore I think the business can grow. That’s a separate question, right? I think all of the macro things that we discuss so endlessly as market people actually in the final outcome has a very limited role to play because macro creates a context for the environment. Either there are headwinds or there are tailwinds. So, let’s think about a boat in the in the high sea. If there is wind behind you, it just makes it easier for the boat to sail, but the boat the you know, you still have the boat has to sail, right? Somebody has to row the boat or if it’s an engine, you have to rev the engine. So, I think that a trade deal with the US and Europe are very important. I think these are structurally great macro factors. Mhm. But they are enablers. It is not a passport to success or riches. But I think it opens up a large market where and there are several areas where Indian companies are globally competitive. Mhm. Right? And I think one area people have traditionally looked at textiles and pharmaceuticals and jewelry. I think those areas have always been there. I think for example, in the current context, one area where I see this making a big difference is in electrical equipment like transformers, HVDC equipment because of the kind of AI and data center build out we are seeing in the US. I think Indian companies are globally cost competitive and have the technology and the capabilities to export to the US. So for example, the subsidiaries of GE and Hitachi and you know many transformer companies and again these are all just examples that I’m giving. These are not recommendations. I think this there is a whole opportunity for uh you know things that you that go into a data center, right? Uh where I think Indian companies will have a great opportunity to supply and export to the US as well as service the India market where I think a lot of data center capex is going to happen. So then again like broadly betting on the AI theme in some way, right? Because Yeah, but more with a picks and shovels approach, right? Because And their infra approach versus you know the consumer applications or Yeah, because the consumer application game I don’t think that is Indian companies will benefit from it. I think the anthropics and the you know the Googles of the world I think are better suited to play the consumer side of the game. Yeah, they are might Even an Apple for example which is such a consumer facing brand has decided that they will go with Gemini and not sink billions of dollars in building their own AI. Which is very surprising, right? For some for a company that has like literally is in user’s hands all the time, has all the data, has all the apps. They also have decided to partner with Gemini which is Yeah, because I think somewhere they also took a call that you know if somebody can do it so well, right? Do I want to replicate by spending billions of dollars or should I just partner with somebody because I own the customer. Mhm. I own the brand. The customer loves an Apple product. He will buy it anyways and I’ll give him the best of uh uh you know, best of technology. Now, whether you want to build that technology or license it, you know, that’s always a call that you want to take and I think they have rightly so in my view taken a call that you know, uh why spend another 40, 50, 70 billion dollars on building your own AI uh stack when somebody else has done a brilliant job at doing it. You know, talking of that, India is making a lot of investments in the semiconductor space, right? Like we are in the race to manufacture own chips and there’s a lot of investment and overall sentiment and push from the government as well to find our own manufacturers in the space. What do you think will play out here? Like any broad thoughts on the semiconductor No, I think I think I think that you know, it is it is an inevitability that you know, the whole semiconductor ecosystem in India will grow. Right? Uh because it is so critical. Uh and I think the world that we are now living in and specially after COVID and the kind of geopolitical uh scenario that we are seeing around the world, I think every major country uh who has aspirations to become a global power is realizing that when it comes to certain foundational capabilities we have to be self-sufficient. So, whether it is vaccines, whether it is semiconductors, whether it is defense, whether it is high you know, biotech and biopharmaceuticals, I think things that are very critical to you, you have to build internal capabilities because the world is becoming very fractious. And you know, as you know that you know, trade and capital are being used as tools to achieve geopolitical objectives. Mhm. I mean, this was not the world that we saw many years ago, right? There was extreme globalization. You did what you were good at and you left other countries to do what they were good at and you thought that there was free borders Mhm. for skills and people and goods and services to to to come to and fro, but that’s not to be now, right? Uh just imagine a a country telling another country that you can’t do business with a third country. Yeah. Right? I mean, this is the world that we are living in and I think we we have to realize that. And I think we took global while globalization will continue and I think it’s a great concept, but but I think that we took it to such an extreme that it was unsustainable. Like a single source supplier, right? Now, what happens, you know, COVID broke that. Mhm. Uh you know, never in the in the 100-year history was the movement of goods and services restricted. Yeah. Take the recent example of rare earth minerals as well, right? Like Correct. So, I think that you know, I think we are going to see a global capex boom. Mhm. Right? Whether it is in defense, whether it is in critical minerals, whether it is in semiconductors, electronics, uh AI, Mhm. uh you know, I think that people and countries have realized that you you need to build certain foundational capabilities and you cannot be dependent on anybody else to do that and that is going to start a whole new cycle of opportunities for investors as well you know and entrepreneurs to build out these capabilities. Yeah, because the shift in the changing the changing world order is very obvious right like it is moving towards very very country specific independent not new right I mean you remember a time when we had to beg the US for imports of wheat and then the whole green revolution started and said we have to be self-sufficient in food because food is so foundational you know I I tell a lot of even my overseas investors that you know had India not had the ability to develop and manufacture its own vaccine. How difficult would have it would have been to get this country up and running? True. You know during COVID. How do you vaccinate 1.4 billion people using imported vaccines? First of all somebody would have not given it to you because they would have said you know first I need to give it to my own population. Which was happening too. Correct you stand in the line and secondly it could have been prohibitively expensive and because we are so lucky that we are born in India and that some of our scientists and leading companies were able to develop and manufacture our own vaccine. That we were able to stand up on our own feet because there were six vaccines in the world two American, one Chinese, one Russian and two Indian. That’s it. Yeah, because you know this again I’ll go back to the same budget day and then the trade deals announcement because there were some market veterans again like Madhu Kela, Vijay Kedia on budget day they were very very disappointed because of the STT but then the following day when they came on, they sort of hinted on the fact that you know there is an over overall rally expected or a new bull run is about to start where there are pockets of you know expensive stocks. But then you know this is a market where you can win by stock selection. Any point of view on the overall where we are currently I think Kabhi Khushi Kabhie Gham. That’s what happens in our markets, right? And I think that there was I think it so happened in during the the budget day was that I think you know investors were looking to for some good news to to to to kind of you know hold on to like the last straw. And while everybody said that you know there are no expectations from this budget, I think it was wrong. Somewhere the the murmurs and the expectation was that okay, you know, they will do something on capital gains and you know blah blah blah. And then you suddenly find that STT has been increased. So it’s it’s just that you know, you you are so frustrated and you know, you the markets have been in a sideways and corrective for the last 15 months. You constantly you’ve been badgered by saying that you’re the worst performing market in the world. You’re the worst performing currency in the world. You’ve not even signed a trade deal with the US. And like everybody’s shoulders are down and okay, you know, we are expensive and you know, there is constant badgering because there is there is always somebody to tell you something about what’s wrong with your market, right? True. So I think it was just a culmin- the it’s like the final nail in the coffin. Kuch bhi ho nahi raha hai and then finally you increase the STT and I think it was a little bit of that reaction. Mhm. But as it happens in markets, I think when everybody is bearish, you never know. Nobody expected that the US India US deal because everybody had written it off because horae horae horae and and you know, it was constantly and I think people gave up hope that I don’t know when the deal will now happen, right? Yeah. And that’s exactly when the market turns. So when we all give up hope and and and that’s why they say, you know, it’s not for any other reason. That’s why they say that it is so difficult to predict markets. But at least one thing was sure at that time is that almost everybody had given up. There was a near cry that you know, FIIs are never going to come to India and No, no, a lot of you know, a lot of my investors also and a lot of other people asked that you know, “Kab aayenge gore?” When will the FIIs come, you know? And I said, “Look, the that this so-called FII, this big animal that you have created, you know, sitting outside of India and deciding whether he wants to invest in India or not.” I said, “They are people like you and me. Mhm. They have the same fears. They have the same FOMOs that me and you will have. I remember in 2021 when I used to go to the US and speak to all the allocators and they would tell me, “China is an uninvestable market. I will not invest in China.” And they were pulling out money out of China in droves. But last year they started putting money back into it. So all of this can change. There is no such thing that FII will never come in India. They will always sell. And coming back to what Rakesh ji said, “Agar ladki sundar hai, to sab aayenge.” It’s just that at this point of time they’re looking elsewhere and they are finding uh you know, pretty faces elsewhere. Elsewhere, but at some point in time this will change. Mhm. Uh so I think they will come, you know, uh global capital is very mobile. It is also opportunistic and just like we get caught up in narratives, they also get caught up in narratives, right? So, you know, from China being uninvestable to China now being a great opportunity to invest, at some point in time India will look attractive to them, and then the same narratives will come, “Oh, but you know, India is a large domestic market, and now all the trade deals have been signed, and we’ve done all the reforms, and now the valuations are” So, if they want to put money, they will find 50 other reasons to justify why they want to put money. And if they don’t want to put money, they will again have 50 reasons to say why they don’t want to put money. So, I don’t think we should stress. These are long cycles. There is always a buyer and a seller in the market. I think for us, we have to assess that do you see an opportunity? And I think in India, you know, it is like an oxymoron to say India is a stock picker’s market. India has always been a stock picker’s market. Right? It is we who got up, you know, get caught up in some narrative once in a while. You know, and these narratives keep changing. And and therefore, I think that India has always been a stock picker’s market, and will always be a stock picker’s market. That will never change. But from time to time, there will be sectors and opportunities and themes which will seem attractive and real and structural. And all as all smart investors do, you have to find the right companies to bet and take advantage of that. And speaking of themes and opportunities that seem real and attractive, you know, you told me your son is a data scientist and is very bullish on cryptos. I would love to spend the last segment talking about cryptos, because, you know, all the market veterans I’ve hosted are completely against the whole crypto run. They don’t believe in Bitcoin. But you are one that you know I found who is actually saying that you know let it play out because you know you never know. No, I mean let’s let’s be fair, right? I mean it is it is fair to be skeptical about something that you can’t lay your hands on, right? I think as equity investors uh over the years now there is a certain framework that we have in our mind to assess a business and what a value of a business could be. I think what a lot of people struggle with in cryptos is what determines the value of a crypto, right? Is it just demand supply? Is it speculative positioning? And again, there are various views about it, right? So some people say that this is an alternative to the fiat currency which everybody is debasing and we just keep printing and stacking on debt. And therefore you know just like gold, you know, crypto could be one you know asset class which you know which could become prominent. And a viable asset class. Now as it happens in any new concept uh there will be naysayers and there will be the believers. And my view is that it is too early to say whether the believers are right or the naysayers are right. I think time will tell, right? If the crypto market survives and grows and I think there is some evidence today that now the sector is getting regulated with many ETFs being set up, uh I do see that globally uh beyond individuals and family offices, even now institutional money is being invested True. in that asset class. We will have to wait and see. So, I think it has to pass several tests of legitimacy and adoption. Mhm. I think we are in the early stages of that. And therefore, I reserve my to proclaim today I don’t want to be and at least I don’t think that I am qualified to proclaim today that crypto is dead or crypto is real and crypto is only the next thing best thing to uh you know, that has happened to the world. I’m saying that I am watching. Uh I may or may not believe in it, but that means nothing. Would you invest in it? I haven’t, but my son has. And I think he you know, it is well within his right to take his own independent calls. Uh and he has a conviction. And I am no one to stop his conviction. If he asks my view, I can give my view, but I will never impose my view on somebody, right? I love that he compared the crypto market of today to the equities market of the 80s mean, you know, very early I as you say you know, I was also little uh skeptical and nervous and we used to have a healthy debate and he said, “Dad, when you came to the equities in the 90 early 90s, people considered the stock market to be the wild west, right? I mean, it is all satta bazaar and there is no science behind this and uh and he says today people have the same view about crypto. They think it’s the wild west. It’s just a speculative tool. There is no real basis to value it. Mhm. But I think otherwise. And I think that uh you know, I think that let him figure it out for himself and I am no one to say that this is right or wrong. The markets will be the last arbiter of which asset class survives and thrives and grows. But I think that there is some case over a period of time that I have read upon it. Will I better disproportionate amount of my wealth on crypto? The answer is no. But does it mean that it is something that I do not recognize or may not have promise? That is also a no. Mhm. I love this healthy tension that exists between generations. Because you know, as a fourth gen obviously investing is also in his DNA. So let’s see how it plays out. I mean I think it’s it’s good to be doubtful sometimes. Of course. You know, and just my final question to wrap up the episode because I think what you’ve shared is truly gold mines one after the other with case studies and everything. But I know that you’re a big reader yourself. So I would love to know some books that have really influenced you both in life and investing. Huh. I I read on various subjects, but I think there are a few books that everybody I think amongst the investment books I would say that you know Peter Lynch’s One Up On Wall Street obviously had a big impression. I have read some parts of the intelligent investor by I would not claim that everything, but you know, I have read parts of that. Poor Charlie’s Almanac is a phenomenal book. Right. So that and then I I read on on various varied topics. I read biographies. I read on technology. Uh I read on psychology. Uh I read on I read a lot of books on spirituality, on Vedanta, on on on Hinduism. Uh on archaeology. So, uh I think uh as Charlie said that, you know, investing is a multi-disciplinary approach. You can learn something from biology, something from physics, something from astronomy, something from medicine, something from health care. Uh it’s you know, you never know what clicks where. And you you you read a lot and uh you read about you you read about the smartest people. That’s the best way to get educated in my view. You know, I love the spirituality angle because I think it’s from market veterans like yourself that the younger generation can learn so much and also become I tell you the dark truth is that, you know, uh at least I and a lot of people uh go to spirituality when, you know, there are phases in the market when nothing works and you give up and, you know, you become philosophical, right? Okay, okay, whatever has to happen will happen type. But I think I was always uh interested in in in the Vedantic philosophy. I think it is the pinnacle of the most sophisticated uh thought process of what we are, what life is all about, what the universe is all about. And there was always that little streak Mhm. in me to find out uh what it meant. And uh you know, as kids again, like I used to go to AGMs, you also go to these spiritual gatherings, the kathas, the Bhagwat that happened. But you feel so bored over there because you don’t know. You heard stories of Ram and Ramayana. You read all of that and that really intrigues you a lot. But as you grow and as you go through the vicissitudes of life, uh you start to think a little deeper about good things and bad things that happen to you and you want to look at the deeper things in life. Like, what happens? How do you uh how do you reconcile with a lot of phenomena that happens? And that’s where I think spirituality and reading about, you know, some of the spiritual masters who have arrived in life, uh gives you some anchor and stability in your life. Yeah, as Manish Chokhani said on the podcast that capital markets is the true way to nirvana. Because, you know, it helps you become uh you it helps you gather equanimity and a stoic philosophy broadly in life in general. But, thank you so much, Hiren, for spending this lovely morning with me. I learned so much from you, and I hope the audience benefits from the nuggets of wisdom that you’ve shared because these are truly timeless and evergreen principles that you shared, and I think they’ll benefit a lot of people. thank you. Thank you so much for having me on the podcast, and I wish all your viewers a great day, great year ahead. Thank you very much. Thank you for watching today’s video. If you enjoyed Hiren’s episode, do remember to subscribe to our channel. It really helps us in bringing you better and better content each time. Hiren’s timeless and evergreen principles will always stay with me. I learned so much from this enriching conversation that spanned public markets, equities, sectors, and stock analysis, but also cryptos and spirituality. Hope you enjoyed watching. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.