Why Most People Will Miss Indias Biggest Bull Run In History Ramesh Damani

TITLE: Why Most People Will Miss India’s Biggest Bull Run in History | ft. Ramesh Damani CHANNEL: Wealth By Motilal Oswal DATE: 2026-05-14 ---TRANSCRIPT--- At a time when volatility induces so much panic, [music] how does one actually stay patient?

When markets go down, if you are afraid to step up and buy the shares, you should be more willing to buy it because you know [snorts] cheaper instead of getting two shirts for $100, now you get three shirts for $100. But I want to identify those multi-baggers and find out what you look at in terms of your criteria. How can I do the same? This is a full-time business first, yeah. This is not a business that you can do, you know, 1 hour and 1 inside. You would lost $10,000 in 6 months. Within 6 months lost [music] the entire amount of money. There was a bull market, the ‘82 bull market just started. What can we look forward to over the next decade? 1.4 billion consumers [music] are getting into the middle class in India. There’s an extraordinary achievement in human scale. You don’t look at the prices, you bet [music] on the theme. Looking at the prices gives us some sort of inertia. Yeah, it’s gone up too much, I can’t buy it. But who says the stock can’t go 20x or 30x, you know, who knows that? [music] You can go from middle-class livelihood to the money class just through compounding in one generation. The index itself in my lifetime has gone from 800 to 80,000. That’s 100x. Every bull market has a theme. Defense is going to be big theme. The mistake I made was Welcome to Wealth by Motilal Oswal. I’m Ava Andabashi. My guest today walked onto Dalal Street in 1989 with an MBA and absolutely no interest for the stock markets. 30 years later, he is the stock market. Ramesh Damani is known as the Nawab of Dalal Street and is perhaps one of the most eloquent voices in the equity markets today. He’s precise enough for data, warm enough for classrooms, and honest enough to admit that he once lost $10,000 in the stock markets. He’s gone on record to say the best day to invest in the stock markets was in 1990s during liberalization and the next best time is today. So today he will be sitting down with me to discuss how he identifies multi-baggers, the opportune time to invest in the stock markets, how to cut through all of the noise, what money means to him, how he’s passing on his wealth creation ideas to the next generation, and so much more. You don’t want to miss this interview, so let’s get started. Mr. Damani, thank you so much for taking time out and joining us. Thank you, Avani. It’s an honor. Thank you so much. So, let me begin with what you said consistently that compounding is the eighth wonder of the world, but at a time when volatility induces so much panic, we have these screaming headlines, and even if we date back to things like COVID, demonetization, the tariff wars, all the geopolitical tensions, how does one actually stay patient in a market like this? You know, let me explain from a different point of view from one of Buffett’s quotes. He says, “When you’re playing a game of cards, and you don’t know who the patsy is, you are the patsy.” And what he meant by that was that when you’re playing the stock market game, when markets are volatile or when they go down, if you’re afraid to step up and buy the shares, Mhm. you should be more willing to buy it because it’s now cheaper. Instead of getting two shares for $100, now you get three shares for $100. So, you should be able to buy more. That depends on you knowing your company. And my understanding of the markets over the last 30, 40 years has been that the market volatility should be your friend and not the enemy. You should use volatility, especially if you’re a young person. India is a young country. You need to invest for the long term. So, you want prices to be cheaper now rather than costlier. So, I think, you know, you I’ve learned over many, many years that not to be afraid of volatility. If you want fixed linear returns, you’re probably a fixed investment type of guy. But if you’re willing to go for more lumpy returns over 3 years or 5 years, then definitely look into equity. You have to learn to play the game, and like we’ve discussed that markets do climb the wall of worries, so They always do. I mean, I’ve seen this from COVID to when India defaulted in the ’90s to when India liberalized, that it always climbed the wall of worry. First would, you know, India be able to compete in the world? Then, you know, would the global financial crisis knock us out of the park? Today it’s oil prices. So, it’s always been climbing a wall of worry, and that’s in fact the nature of the market. And when things are really perfect, you probably don’t want to buy because everything is overpriced. Okay, fair. We’ll talk about that a bit later, but you know, you’ve also consistently said that the next 30 years in India will be more exciting than the previous. But we’ve been through so much, liberalization, the IT boom, the infra super cycle. What can we look forward to? What will India look like over the next 30 years? 1.4 billion consumers are getting into the middle class in India. That’s an extraordinary achievement in human scale. The only other country have done it on scale, on population scale, has been China. I think India is following suit. So, we’ll go from per capita income which used to be a few hundred dollars to a few thousand dollars, 8-10 thousand dollars, which puts it in the middle income. So, that’s a very exciting story unfolding. We’re lucky we have such a strong domestic economy, and we don’t necessarily have to rely on exports, which are no longer the shining beacon that they used to be. So, I think we’ll be fine. I think this 1.4 billion consumers will power this nation forward. And what about investment themes each decade? Because there have been interesting themes that have popped up every decade. What do you think is going to be the big investment theme for the next absolutely right. Every I don’t think every decade, but every bull market Okay. has a theme Mhm. that if you latch onto you will make very serious amounts So, for example, in ‘92 you latched onto the cement boom, in 2000 the tech boom, in 2008 to the infrastructure boom. So, every bull market has So, so does this bull market have it. But I think now that we’re well within the framework of bull market that started during the COVID lows, I would say looking ahead for the next year or two, three years, we try to come with some intellectual hypothesis what we think the market will favor over the next two years or three years out there. And I have three hypothesis working hypothesis. Once we have this hypothesis, we believe this hypothesis, we try and find stocks that fit that. So, I think the first hypothesis uh one is that defense is going to be a big theme. I think everyone has realized uh after the Ukraine war and after the Iran-US conflagration that every country needs to be dependent locally for defense materials. You’re no longer going to get cruise missiles or Patriot missiles or from Russia or from America. So, I think the defense industry will boom. So, I think they first played out in the public sector stocks because they had dominant shares in the defense industry, but now increasingly private sector companies are doing well in that matter. So, the first hypothesis would be uh defense. The second hypothesis is that everyone wants to localize the supply chain. No one is willing to now rely on a supply chain extending to China or Australia or Indonesia or Europe. You want to localize. So, whether it’s mining, whether it’s metals, whether it’s minerals, all of that will tend to do well because I think Mr. Modi spoke of Atmanirbhar Bharat. Before that they talked about self-reliance. I think there’s a whole new twist to it. I think a lot of companies that are what they call heavy assets, low obsolescence. We used to always worship at the water of the low obsolescence software type of intellectual property stocks, but I think the world is changing because of what Trump is doing. And the third part is what I think worries the market a lot is this AI thing. So, you want to build a portfolio that’s anti or anti AI or not affected by AI, let me put it this way. And I think the best thing that occurs to me is infrastructure. If you go to infrastructure, that will be used as pump priming to boost the economy if it goes slow down. It’s not affected by oil prices, and it’s not affected by AI. So, I think those are the three silos that we’re looking on for the next 2 or 3 years. Okay, that’s a bull market theme that you’re looking at. Exactly. Okay. Uh but I also want to So, let’s pick up on one of these themes and defense since you spoke of. I’d say that’s a gem that you picked up, you know, back in the time of liberalization when PSU defense stocks were so much cheaper than they’re trading at right now. But for someone watching this interview, they say, “Hey, we missed the bus or we didn’t pick it up at the right time.” What are you telling them to do now? One is it’s a truism in market that when a bull market begins and when a bull market ends, the stocks that you bought when the bull markets began and end are totally different. You’ve no understanding. For example, when I was a young lad and I joined the Bombay Stock Exchange, you had ACC in a bull market and the stock was maybe 300 bucks and I could send the lowest jobber in my office and he could buy 25,000 shares without moving the price. It was that liquid a stock. In the next 4 years of the bull market ended, the stock went from 300 to 10,000 rupees, okay? So, there is the is very it’s falsity to say that the prices are too high or too low in a bull market. You never know what happens to stock prices. So, having said that, would I bet on the defense theme that we bet on say 3 years ago? Probably not. I think what this Iran war and what the Ukraine war has taught us is that asymmetrical warfare is going to be the new buzzword. So, you don’t necessarily need While you do need cruise ships and you do need cruise missiles and you need Hindustan Aeronautics, you also need people who make drones, people who make smart ammunitions, people who make 20,000 ships that can ram a bigger ship. So, there’s a lot of opportunity in explosives, in logistics, in drones. So, we would start looking at those sectors. But I think overall defense will do well. So, you’re saying even at a time when there is a a solid bull market run, you don’t look at the prices, you bet on the theme. You bet on theme. I think looking at the prices gives us some sort of inertia. Oh, it’s gone up too much. I can’t buy it. But who says a stock can’t go up 20 x or 30 x, you know, who knows that? Okay, and the other thing that you have spoken about before is digitization, you know, moving from the Flintstones to the Jetsons, as you call it. But would you say that given that now globally we’ve seen tech stocks really dominate the market capitalization, is that dangerous territory to be in and what do you make of Indian IT back home? I think there there seems to be a problem. I think the fact that for 30 years since Infosys went public, we worshipped on the altar of software as eating the world, software being asset light model, software not being affected by the oil crisis. But you finally have some super intelligent guys at Tropic come up with software that is written for free. So essentially took the most prized commodity and made it free, as happens in the world so many times. So I think there is a risk to the software. But having said that, I think I think personally at this point market is throwing the baby out with the bathwater. I think there’s reason to believe that uh these companies are not going to fall off a cliff. Let me give you an example. Uh when the [clears throat] ATM machine was invented in the ’80s, people thought the teller jobs would be obsolete. But they didn’t become obsolete, you know, they just complemented the teller jobs, the ATM job. You use banking at 6:00, you went to an ATM machine as opposed to a teller. You’re in a hurry, use an ATM machine. But what made the teller obsolete was the iPhone. When you electronic banking, then you don’t need the teller anymore, okay? So it will take some time to play out. I think we’re perhaps writing off too much in a hurry uh the software business. You know, I think there are serious implications for it, but I’m not sure. I think it’s just today the bright shiny object, so everyone is scorning it a little bit, but I think maybe it’s a bit as Mark Twain said, the rumors of his death are a bit premature. Okay, so is the market being a bit too harsh when it comes to IT? And what have you made of Indian IT companies? Are we smelling the coffee? Are we waking up to the big changes happening, or are we still living in the Stone Ages? some of them are. Some of them have made public pronouncements that even at the cost of cannibalizing revenue, they are pushing AI. Uh I think did we miss the bus? Yes, we missed the bus in the sense that instead of paying the hefty dividends and buybacks, they could have bought a lot of beeches into these companies, which they did. But having done that, I You know, I mean you’re Here’s a stat that surprised me when I was reading about all this, that Anthropic, which is of course the poster boy for AI, uses Salesforce to run its business. If it was so easy to create code, they would create a code for themselves and the business. So, they will There’ll be a period of coexistence, and I think uh the Indian IT guys will fight back. It will be a changed company, but I think the overall the market will expand in the next 3 to 5 years. It will. Okay, so the IT market is going to expand, and you have said that we’ve not really we did miss the bus maybe a few years ago on AI. Um but what about uh the entire pharma theme? You said that India has become the medicine shop of the world. There’s so much happening on that front. We’ve clearly picked up pace. Where does India stand? I think surprisingly for me, I have not been a big pharma bull because I have probably not understood the sector as better than my contemporaries. But having spent some time looking at the sector, I’m finding I mean, there are a lot of people who made money in what they call CDMO or you know, those kind of businesses. But increasingly, I find Indian companies are doing intellectual property. You know, they’re building antibiotics, they’re building dengue vaccines, they’re building so many things that, you know, are not just, you know, cheap knockoffs or generics, but also intellectual property or cloning some very very expensive cancer medicines, say for example. So, I think there’ll be a great opportunity out there. I think that is not fully discounted or discounted by the market. well. GLP-1, of course, is all over the phrase and you can already see the prices have come down so sharply because Indian companies have rushed into the market uh as soon as they’ve done that. And I actually use GLP-1, so I know the benefit of it. Okay, that’s interesting. But um I want to understand your view because of course you talk about buying into a business, but you also look at an entrepreneur as a whole, especially for a lot of these new age businesses that have now been listed. What does it make when you look at your checklist for valuing a company from the entrepreneurial standpoint or from the leadership team? Is that a big criteria? Of course, it is. I mean, you know, it cannot be not a big criteria. Uh I think over time I’ve just become better at judging the quality of management. I think what we look for is a bit of humbleness, a bit of fire, uh a bit of uh ability to think around the corner. Uh these are intangibles. I think they come only from experience. I think a lot of people say that, “Oh, how do you figure out the management is good or bad?” I think it comes from experience. You just have to go through AGMs, listen to them on YouTubes, listen to their podcasts, and see, you know, is this the kind of person that you would trust with your money? And I think uh it helps to have 10, 20 years under your belt judging these things. So, now that you have that kind of experience, decades More than a 10, 20. Decades of experience. Um when you’re looking at some of these new age tech companies or companies that have listed coming into new business areas, uh what do you make of it? Do you believe that, you know, valuations are a bit unjustified? There’s been a lot of froth in the market, over enthusiasm? No, I don’t think so. I think uh you have to look at a case-by-case basis. Okay. So, if you look at uh say, for example, the guys who opened this whole new category of instant delivery, okay? We never used to that, but suddenly now it’s a part of our life. It’s not going away anywhere, you know? So, I think that is a good category to look at. I think companies that provide temporary help to you in your house, it’s a whole new category. It’s so hard to get good help uh nowadays because there’s a scarcity, rates have gone up. So, company that can help you do that will probably do that. So, I think, you know, there are lots of opportunities in that area. Maybe not this bull market, but maybe the next bull market will be led by those companies. But, it’s not too early to start paying attention to them. Okay, so it’s it’s obviously case by case and you are looking at this quick commerce as a category. As one of the categories. As one of the categories. Um let’s talk about China given the kind of tech adoption that that’s been there versus what we’ve seen in India. Is there a worry about foreign investors shifting to China or are we confident about the India story? Well, I think should we worry about the Chinese? Of course, we should be worried about the Chinese. I mean, they’re so far ahead in so many things and they’ve really done an exceptional job. So, but the big difference between the Chinese stock market and the Indian stock market from what I understand is that China has what they call state-sponsored capitalism where capital is not a constraint. So, the return on capital, return equity ratios are not very good in China because the state wants to control critical minerals, control electronics, control semiconductors. So, they don’t really care about the cost of capital. But, India’s always been a very frugal capital country. So, it has always paid a lot of emphasis on that. So, stock market returns always better when you pay attention to capital returns. And I think India will do well on that score. India is a very entrepreneurial country. I think even in the ’80s and ’90s when we went through a whole degree of socialism, the BSE, for example, stood out as a capitalistic, you know, tower in our country. So, I think we’ll do fine. I don’t think we have to be afraid of. There are areas we have strength in and I think we’ll continue to do fine. Plus, we have 1.4 billion consumers. Speaking of being worried, though, what’s your view on what’s happening with the US dollar? I mean, do you believe that the the overall cash reserves or that that will completely change alter over the next few years given the kind of headlines that we’re seeing? What I’m worried about is not the dollar is almost in sync with it. What I’m worried about is basically America’s changed forever. I think the America that you and I grew up with, at least the one I grew up in, that made this whole world that we live in today, you know, the rules-based international system has changed permanently thanks to President Donald Trump. And I don’t think we’re going back to the way America used to be. Even if a new president comes to power, you moved too far away to come back. I think, for example, say tariffs, you know, I think they’re anarchists to do it. But Biden Trump imposed and Trump won’t impose tariffs on China. Biden didn’t remove them. You know, this you know, the the whole body politic of America has changed. I don’t know how I can explain my anguish because America gave us the world we live in today, you know, the rules-based system where everyone prospered. And, you know, there’s old saying, “What does he know of America only America knows?” I think Donald Trump doesn’t really understand history. He’s trying to address the short-term problem with some wrong fixes in my view. And unfortunately, the world is going to pay a price. So, all this defense, self-reliance is all coming from basic failure of American policy. America was such a great country, took the whole world along with it. Yeah. You know, it it it grew its economy and the whole world grew with it. And there’s peace and prosperity that was unprecedented after post-World War II. I think that I’m worried about. That is changing. And if that changes, clearly the Dow is pay the price. World will pay a price, the dollar will pay a price, America will pay a price. And while the Dow and the Nasdaq keep making new highs, I think sometimes it’s the AI boom that’s causing that, not necessarily an America boom that’s causing it. Because of the kind of concentration of tech stocks in the market. Concentration of tech stocks and clearly there’s a new hot technology that the world wants. Okay. How much of a concern is that really for the rest of the world just in terms of what you’re talking about America? How will the world view it in terms of higher education, things like that? Do you feel that there’ll be a complete shift? Maybe it could be better for India in the long run? I you know, I think the world needs a strong man who they believed in, you know? You you definitely don’t want the Chinese to replace America as the policeman of the Straits of Malacca or the Straits of Hormuz. You need America because you trusted the system of jurisprudence, of government, of the rule of law. But unfortunately, that is changing and I think the world will not be a better place. It’ll be a different place and as a very famous ice hockey player said that when he plays ice hockey, his father gave him a piece of advice. He says, “Wayne, go where the puck is going, not where it is at.” So, I think as analysts in the market, as believers in the market, we want to follow what will make us money, not necessarily what is necessarily good for this country. Also good for the country, but not necessarily what’s uh you think is good, but what is where you think the puck is going. And the puck is moving very towards asymmetric warfare, reliance, anti-AI. So, so that’s what we’re betting on. Okay. Um you know, you have spoken as well in the past about your exposure overseas. Um what can you tell us a little bit more about that, what you’re advising an investor to do today? Well, you know, I think we allowed $250,000 a year in LRS, so I send some of that money abroad. But having said that point, uh the kind of money you made in America in some of I mean, yesterday, Intel was up 20% in a single trading session. It went from $20 to $80 in a period of 6 months. Uh some of the companies that I used to follow in 10 years back, 12 years back, Seagate and Western Digital, they make hard drives. They have 10 10X. So, the kind of money that’s being made is just phenomenal in America, but you would associate that with late stages of a bull market, which I think America is experiencing right now. So, I mean, to be honest, I’m not really in the position to give advice as to what to do in America. Uh my feeling is that uh it’s having what you call the last hurrah. Mhm. And then when it comes to commodities, this commodity supercycle that we saw sort of play out, when it comes to gold, does the view change on gold and silver owing to what we’ve seen? Oh, I love that question. I get a lot of flak for being negative on gold, and I’m a strict Buffettite on this. And I’ll tell you why. When I was a student in America, I did my MBA from American University. Uh and a friend of mine of 30 years contacted me because they knew I was in the financial markets. “Oh, Ramesh, is this a good time to buy gold, you know?” I said, “Well, hello, after 30 years first. But when we were both students uh in America, gold at that time was the first time to peak at $1,000 an ounce, and the Dow was just below $1,000 at that time. Now, fast forward 40 years, gold is at 5,000, the Dow is at 50,000. That ignores the yield that the Dow has given. Gold is not giving any yield. So, I think long-term investors must bet on good quality businesses in equity. If you’re a trader, if you want to speculate, by all means go on, you know, speculate on gold the way you direct. But over long term, whether it’s in India or in America, you look at the returns of the cager in gold versus equity, I think there’s no contest. I mean, you remain in equities. The returns speak for themselves. And then like you said, the proof is in the pudding, but since you brought up the word speculation, then what’s the view on crypto if I may? You know, I think it gives rat poison a good name, you know? So, I’m not in fa- I’m not in favor. I mean, it’s basically useless thing. It’s just a speculative medium people use. I’ve been on record as saying that, and I know I’m going to get a lot of flak from the crypto believers, but I don’t believe in it. Useless is how you’re describing it. Okay. Rat poison. Rat poison. Okay, very uh you know, you’re making your views very uh uh definitely very clear. Now, I’m sure a lot of investors, young investors today want to know. I mean, I just had you know, one of them whisper in my ear before we started of the interview on the TM and they said, you know, I’m a young investor. I’m investing in the good old SIP way, but if I want to identify those multi-baggers and find out what you look at in terms of your criteria, how can I do the same? What do you want to say? But, you know, the thing I like to say is this is a full-time business first, you know. Okay. This is not a business that you can do, you know, 1 hour on one inside. It doesn’t work that way. Typically will not work that way, you know. Uh you need a lot of focus and a lot of If you If you are say you know, someone who’s a hairdresser or someone who’s a lawyer or someone who’s an architect, by all means do your profession and invest in the SIP in the market with your savings. I have no problem with that. But, if you want to get wealthy in the stock market, if your chosen vehicle is wealth in the stock market, you need to focus on it 12 hours a day, 14 hours a day first. That’s my first criteria. Second is you got to understand valuation. The most important part is that as my mother taught me when we went shopping, you want to buy things cheap. So, I think that helps to try and if you walk into a Zara, walk into Indian Hotels, walk into a Bata showroom, what is the valuation of this business and does it make sense to me? And occasionally market will throw this as I call it nice full toss outside the office which you can hit for a six. So, the the thing I’ve learned and the thing that I’d like to speak to young India about is that you It’s not a game of T20 where you hit on every ball that comes to you thinking, oh, I want to make some money today. Market is not for that. But, you wait for something that is completely mispriced and then you load up on that. So, to give you an example, you talked earlier about me buying the defense stocks. So, these stocks were available at cash value with 5 10-year windows of business available to them. So, I think you look for those kind of opportunities. Okay, that’s wonderful. So, it need you need to devote time. You need to understand valuations and then wait for it to be mispriced and then load up on that opportunity. There you go. You’re ready to be a stock picker. Look at me. Okay, you know, what about Dmart because that is one of the greatest retail businesses that India has ever built. It’s a masterclass in economy makes and frugality. As chairman, you know, running that, what did that really teach you from a real business at the stock market never would? I first I don’t want to talk to you lose your Dmart because I well, I was the chairman and no longer the chairman. I have I mean term limited out of the chairman and because I’m still close to the company, I don’t want to talk publicly about it. But, what it’s taught me is that how great business is built and how it’s important to focus on the business and not the market cap. I think a lot of mistake entrepreneurs make is the ego gets involved in the market cap and they run the business for market cap rather than running the business market cap being a byproduct of running the business correctly. So, my advice to all the entrepreneurs is don’t try and focus on market cap. Focus on running executing a business. I think if you look at the execution, it’s extraordinary execution that you see there. So, my advice is ignore the market cap, focus on the business. Any other mistakes [clears throat] that you think business owners or entrepreneurs make? They make I think we value equity a lot and if you keep diluting equity because you can raise money with the market being philanthropic, you can give the money. I mean, that’s always a mistake. So, I think the scarcity of capital mindset, the ability to control your ownership stake is so important in the financial markets. You’ve been honest enough to say I think that you would lost $10,000 in 6 months. Am I getting it correctly? Tell me about it. Take me back to that. Well, you know, here’s the story and it was a cheap education I want. Let me tell you that In retrospect, of course. So, when I was a a grad student, uh my dad was a bit troubled with me because I was not interested in the stock market, and he always kind of was interested in the stock market for me. So, he made this wager with me that he’d give me $10,000 and that I can invest it in the stocks. And if I uh made money, that was my money to keep. And if I lost money, no questions asked. I didn’t repay him back. So, that seemed like a fair deal to me, right? What’s fair than your father giving you 10K, right? So, I started investing in America and sad to say that within 6 months 1 year, I lost the entire amount of money that I invested. And what particularly irked me, Yvan, was that there was a bull market, the ‘82 bull market just started. The Dow crossed 1,000 for the first time, and I happened to lose that money in a bull market, and I couldn’t for the life of me figure out. But, I used to be a reader, so I did some introspection and thought, “What did I do?” And I realized I came to the conclusion that the mistake I made was driving by looking at the rearview mirror and not at the front view mirror. You always drive by looking at the front view mirror. What was looking in the rearview mirror? I looked at the stocks that worked in the ’70s. What were the stocks? Gold, oil, commodities. But, by the ’80s, these things had the era of inflation was over. Fed Paul Volcker completely carved out inflation from America, and you had to look at new degrees of stocks to do well, the capital-efficient model. Look well. So, I never made that mistake again. Every bull market I look ahead to see what would be the new ideas and the new themes. I never try and make money just because stock has fallen 50% think, “Oh, it’s cheap now because it’s fallen 50%.” Because I know the stock that’s fallen 50% can fall another 50%. That’s the way nature of the market. So, I never made that mistake again. So, it was uh in a sense a cheap lesson, though it seemed expensive at that time. Correct. Okay, that’s interesting. Don’t drive looking at the rearview mirror. Um what about your relationship with money? Just curious to understand. We keep talking about this hedonic treadmill, and I think that’s true more so in this time of social media and comparison and looking at other people’s lives. How is your relationship been as you started acquiring money, and what would be your advice to your next gen? See, it’s very important to have money. I think we all struggle to make money. It’s very difficult to make money in this world, and so it’s very But I think in the market like most of my contemporaries uh I associate with, we treat money as a way of keeping score. Who’s been right? Who’s been wrong? Whose stocks have worked? How much did they buy? Yeah, I I’m My son is constantly surprised that despite a level of wealth uh we still live pretty frugally. You know, we we have the same set of friends. We eat love our idli sambar or whatever. And you know, we still enjoy each other’s company. So, we we’re value investors through and through, not just in picking stocks, but in living life also. So, while money is important, I’m not disputing that. And I think because you have that, you become a bit more you know, relaxed about it. But I think we use it more as a way of keeping score rather than a way of, you know, flaunting it. You know, and I actually read Morgan Housel’s book, and he said that even the richer you become, what matters is still the same thing: family, quality time, and you know, doing things that you enjoy. occasional cigar. Uh of course, [laughter] why not? So, um what would be, you know, your lessons that you’ve learned through Mr. Rakesh Jhunjhunwala and Mr. RK Damani that you would like to share with us? Something that maybe would say stay on top of mind. Well, I think the one thing that they both taught me two things about that they taught me. One is that when you have an idea, you have to put money on the table. All right. Okay. You have to bet your beliefs. Mhm. You know, you Someone will say, “Oh, I like this idea, but I’ll wait till the market gets better.” You know, boom, you miss the choice, okay? So, you have to put money on the table and put it at risk. If it goes down, I said my coffin boundary, I take it down and it’s okay. I I can deal with that loss that can happen. So, I think I learned that and I it’s it’s incremental. I still haven’t learned the lesson the way they play the game, you know? The ability to quickly think and put money on the table extraordinary achievement of these two gentlemen. give me an example maybe where you’ve noticed something or it happened with a particular company or a I’ll tell you there is one particular day with one of these gentlemen, I won’t give his name. We were walking during the night and point. And I happened to explain to him a company that uh I liked for whatever reason. It was a brand name. He asked me like three, four questions. That means he’s already done his work. He asked me three, four questions out there. And then he told me speaking colloquially, he said, “Okay, buy me five lakh shares tomorrow of that company.” So, I said, “Fine.” And then I called up another broker who was short in that company and I said, “Uh I want five lakh shares.” So, he came back to me half an hour later saying, “Uh there’s a problem that this guy doesn’t have five lakh shares, but he has 50 lakh shares and he wants to sell them all in one piece or nothing out there.” So, I called him. I said, “Boss, we’re going to deal. There’s no lot available that you want.” He said, “What’s the problem?” I said, “There’s only 50 lakh shares available.” He said, “Okay, close it.” That’s putting money on the table. He had done his homework and he’s not willing to he’s willing to bet his convictions on putting and I’ve seen that time and time again with these people that once they make a decision, they raise it fast and they’re not scared of losing money. They’re always ready to put money on the table. I’ve seen this so many times with them. So, I realized that such an important part of being a good investor is when the time is right, when the stakes are hot, you you know, bet Grab it with both hands. Grab it with both hands, you said. That’s correct. The second thing I learned was that for 30, 40 years is that they’ve always been bullish on India. I’ve never seen the markets are volatile, so they will go down. Of course, they’ll go down. They understand that. But, they know the trend line is up. So, no matter when the income tax rates were 90%, no tax when Ayodhya happened, no tax when we had a financial default, no time when the global financial crisis happened, they always remain bullish in India and they remain bullish in India. And hence, the feeling that as good as the last 30 years have been, the next 30 will be as exciting. That’s something you’ve definitely picked up or inculcated. I have to say. I’m trying. I’m not such a good student, but I try. Okay. Um I I also want to know that there’s a lot of advice out there. There’s a lot of information at everyone’s fingertips. What do you want to say to say a a 25-year-old who has made 40% in 2 years? Now, he thinks he knows the markets. [clears throat] What do you want to [laughter] tell him? I I think as a woman said, nothing to me is sadder than someone who makes 20% when a stock can go up 20x. Okay? And I think that is the understanding markets or how markets behave. And I think I would advise them to do that. If you’re a 20-year-old in India, you’re what we call the ovarian lottery has been born. You’re in the right place at the right time. Invest that money and you’ll be surprised that with the magic of compounding and slight help of a bull market that you can go from middle-class livelihood to the money class just through compounding in one generation. That’s the opportunity that India is offering us today. And I think young people who are paying attention should grab that opportunity with both hands. It’s not It’s a difficult business. What did Buffett say that it’s uh simple, but not easy. You know, so you have to, you know, bet on great businesses that will compound over time. But, to find that one great business, you might pick 1 year, 2 years, 3 years of going through balance sheets, con calls, podcasts, visiting companies before you find that nugget that you feel it just cannot be. So, when when you come to the conclusion that I can’t sleep because I don’t have this investment, that you probably own it something. And a second corollary to that, it’ll probably be unpopular when you tell that to your friends or to me or anybody else, they’ll probably dismiss it. So, unpopular is a good example of something being valued correctly or incorrectly and you can take advantage of that in the market. Okay. So, what I did is I actually asked, you know, a group of young women and ladies who are not that into the stock markets. I said, you know, I’m going to be interviewing Mr. Damani today. Do you have any questions? Oh, wow. Firstly, they were floored and they said, “Oh my gosh, we can’t believe it.” But they did, you know, one of them asked that when it comes to intergenerational wealth, is there any advice that you have when it comes to temperament and even maintaining that wealth over generations when it comes to family businesses or even maintaining the wealth in the stock market? It’s a very difficult question, something I’m grappling with. But as you know, I have a young son. Yeah. Um you know, I think I believe in what the Buffett philosophy is that give them some, but don’t give them so they don’t have to work anymore in their life. Uh I think there’s a joy in making your own wealth and building your own fortune. I strongly believe in that. And I think more important than giving the wealth, I have to give them the insight, the ropes, the contacts. Yes. Which uh But it’s so difficult, I feel, to do that with children, especially maybe your grandchildren who have have grown up with so much more than you did. Oh, they have, but I have two amazing grandchildren, Veer and Arna, which I have to mention, give a shout out to them. And we’re starting them young. For example, Veer Oh, tell me. instead of teaching him, you know, A for apple, B for ball, C for, you know, cat, whatever, we taught him ABC through the companies, you know. B for Berkshire. [laughter] Yes. C for Colgate, whatever. So, we started him young. Today he’s 8 years old, but he knows Charlie Munger. If he comes to our office there’s a Charlie Munger bust, he goes and does pranam to it. So, we taught him young. I think Anna is still five, so we’ll probably teach her also the same things out there. I really feel like you started the introduction there if I teach them compounding, I’ve taught them to be free for life, you know? So, I want I think both my son and I, Ashok and I, we try early on teaching them uh the importance of good financial hygiene, good financial habits, and the importance of, you know, compounding your wealth over long periods of time. It is one of the most extraordinary uh insights I’ve had in my life is that the minute you understand compounding, it’s almost like setting yourself free. You don’t have to worry anymore because you know you’re going to be rich. Okay, the matter is what is the path to take you there? That’s all. Wow, was his first word stock market? [laughter] Wow, so you really practice what you preach when it comes to I do and I think for almost every birthday of his, we try and give him some stocks rather than only a toy or a clothes or a trip. We try and give him some stocks. So, over a period of time, they will compound and maybe he’ll have something of value when he’s 18 or 20. Oh, he will be very happy when he’s 18. If they work out, yes. We don’t know about that, but Um so, if you could sit across uh 20-year-old Ramesh Damani, what would you tell him? I think the two lessons that my mentors taught me would be great lessons that you uh have to put money on the table and you have to be bullish on India. Okay. Because the opportunity is extraordinary. It took me a time. See, it’s I’m more cynical by nature. So, it takes me time to have this unabashed bullishness or to believe in a business for 10, 20, 30 years. If you look at the market over the last 30, 40 years period, who have been the people who have really prospered and built, you know, great fortunes in India? The people who believed in the market, believed in stocks, believed in compounding, believed in great businesses. People who have tried to take shortcuts have all ended up in places that you don’t want to end up with, you know? You know, made money, lost money, the arbitrage, the jobbers, the speculators, the traders, the charlatans, they’ve all really been relegated with the market. But, people who stuck to buying a great business because it’s available cheap and sitting on the rear, not trying to, you know, put it to an institution or doing anything nefarious, have really made out like bandits. I mean, the index itself in my lifetime has gone from 800 to 80,000. Yeah. That’s 100x on the index. What individual stocks have done is unfathomable almost. So, Absolutely. opportunity to make money legitimately. Okay. So, the the India story and the conviction needs to be strong and it has been, but you wish it had perhaps been more at an earlier age. I wish I had the courage of my convictions at that point. When I I’ve been blessed, I’ve had many hundred baggers in my life, which is extraordinary thing to say because not anyone gets that. But, you know, you need when you have a great insight, you need to what Buffett says, back up the truck and buy it, you know. And, you know, maybe I’ve been a bit remiss in that. But, you know, you have spoken about missed opportunities. Like, for example, in 2008, every great investor, I’m sure, has a list of some of those, oh no, I wish I had. Do you have a few of them that really stand out? Of course, they do. Can you tell me what? You know, it’s You know, the reason I feel that is because you’re in this kind of business and I’m a prop investor. I invest for myself. I don’t have any clients. So, there’s no one to come and reproach me if I don’t have a bad year or something. But, I think there should be a burning ambition in every young investor to be the best that he can possibly be. He wins the Oscar, he wins the Olympic gold medal, he wins the Fields Prize in mathematics, he wins the Pritzker. And the way you measure yourself in the stock market by the amount of zeros in your bank account. It’s very simple. You know, you How much money did you make in the bank account? So, I feel that I could have done a much better job than Uh, I have done so far. It’s not I’ve I have badly. I have had a good life, you know, I have no problem. And the reason I say that is not because I want people to feel bad for me or that Ramesh didn’t make money or something. I did fine for myself. But I want to inspire the next generation to think bigger, you know, to think wiser and to be more bold and to be more decisive than I was in my life. That is the only purpose to say it. I want to inspire, hopefully through my experience, a new generation of young investors to think that they can be the Soros, the Buffets, the Rakesh RK Damani’s of the world tomorrow. You You You answered my closing question for me because I wanted to ask you what you want to be remembered by and I think this would be the same messaging, right? To inspire the next generation to be bolder. I wish to be known as the world’s best grandfather. And then I wish to be known as someone who, you know, uh, helped open people’s eyes. I I have no doubt that the the grandfather award goes to you for sure. [laughter] Thank you. That That makes my day. Thank you so much. I have a quick rapid-fire. So, these are sort of one-word answers or anything that comes to mind. That’s right. Where do you learn more, a bull market or a bear market? Bear market because, you know, fortunes are made in a bear market. So, you because you always want to find value, you want to reap the harvest in a bull market. But bear market’s nothing like that. lessons. Okay. A book that changed how you think about money, not about investing, but how you think about money? I think there’s a book called, uh, A Piece of the Action by Joseph Nocera. It was recommended actually by Warren Buffett also. But that lays out the whole financial industry, how that has evolved since the 1950s in America, starting with credit cards, FDs, savings, bonds, whatever. So, that’s a good book to read. A Piece of the Action. of the Action by Joseph Nocera. Okay. And if you had to put your entire net worth in one sector for the next decade, and if you couldn’t touch it, which would that be? [laughter] Probably, if I had to the criteria that you mentioned, I’d probably look at some new economy stocks. I wouldn’t look at you know, the themes I mentioned to you earlier. You want to huh? Yeah, exactly. There you go. There you go. See you’re becoming an investor. [laughter] Okay, Sensex at 1 lakh closer than people think or further? Closer. Okay. A business you admire but you still wouldn’t buy it because of the current price right now. I don’t want to mention any specific names out there. Maybe a sector. Yeah, but you know I mean there couple of businesses that seem always expensive but keep delivering results quarter on quarter. So you know if you really like a business and why the management the market multiple will catch up. So I think buy it. Okay, interesting. Name the investor or the person global or Indian that you really want to peek inside their portfolio right now. I mean anytime I can peek into Buffett or Munger’s portfolio, I would do it. But say they pass on the legacy to someone called Li Lu. I think if I could be friends with him that would be enormous. There’s so many great investors that admire. You know that I wish I could you know learn from them. And I’ve been very fortunate as you know I’ve done my own show. I’ve traveled the world interviewing a lot of famous investors out there. Mark Faber, Jim Rogers, there’s so many of them. So I’ve been very blessed. Yeah, yes absolutely. And one last question in the rapid fire. The last stock that you researched that genuinely surprised you. Um for the upside or Could be either way? Uh [laughter] Well, I think some of these asymmetrical defense plays I didn’t I there is a lot of good high quality businesses in the private space that you know will contribute to the asymmetrical warfare effort. Mr. Dangi, what a pleasure it is speaking with you. I feel that you speak so eloquently and yet it is understandable by everyone and so many gems and pearls of wisdom that you’ve shared with us. So thank you for your time. Thank you, Owain. Great to be with you. So many key takeaways from that interview with Mr. Ramesh Damani, the legendary investor. And here were some of the key takeaways that really stood out for me. Do remember that you need to make friends with market volatility because at the end of the day, the markets do climb the wall of worry and it is good to get stocks at a cheaper price than at an expensive one. But if you’re looking to make money via the equity markets, it’s important to understand that you need to devote a lot of time to it. Need to understand valuations and need to wait for stocks to become mispriced and upload on it. He did talk about how every bull market has a theme and the three themes that he is bullish on right now are defense, localized supply chains, and the anti-AI themes or themes that will not be impacted by AI. He said that IT has really been given rough treatment because some of the IT companies has definitely missed the bus when it comes to AI. He is worried about China because they are streets ahead of us, but India is a very entrepreneurial country and the long-term India story remains very strong. Remember the next 30 years will be better than the last. And he’s spoken about crypto being completely rat poison. In terms of his beliefs, he said that never look at the rearview mirror while making investments, always be forward-looking. He’s a value investor, he’s frugal in life, and he said that his messaging would be to inspire the next generation to be more bold in their beliefs. I really hope you enjoyed this interview as much as I did. Do remember to hit that subscribe button, like, follow, and do comment. Why don’t you share with us in the comment section which guest you’d like to listen to next? We’d love to know. Thanks for watching. Investments in securities market are subject to market risks. Read all the related documents carefully before investing.