It has generally been observed that a person takes to a field, be it professional or sports when he finds someone inspirational to follow. This idol, who is termed as the ‘hero’ is studied very closely to understand how he achieved the level of success that he did. What was his inspiration, what is his modus operandi and the path that he followed to achieving success.
One thing that is commonly found in chasing a ‘heroes’ dream is that success is not an overnight event. There might be a lucky break here and there but few, if at all, have been successful for a long period of time without putting in the hours. Achieving success takes a heavy toll, both in terms of time as well as persistence and discipline. It has been found that dedicated efforts for a time period of 10,000 hour is common among all heroes across all fields.
Psychologists generally sight examples of sporting success and the effort that has been put in by them to reach the level where they are. Successes of many businessmen and managers have for years been taught in management schools, to imbibe the value system and rules that have been followed by them.
Investors and traders too have their set of ‘heroes’ to follow and worship. Benjamin Graham, Warren Buffett, Charlie Munger, Peter Lynch, Philip Fisher, George Soros are some of the international names who are believed to have a halo over their head by the followers. Many Indian fund managers and high net worth individuals have developed their skill sets by following these stalwarts of investing.
Indian public over the years now has their own set of ‘domestic’ heroes to follow as one hopes to replicate their success. It has, however, taken years of steady returns before these gentlemen were accepted by the investing community as ‘heroes’.
Before that, there were many ‘false gods’ like Harshad Mehta and Ketan Parekh who were worshiped by speculators. But these individuals generally did not last beyond the bubble that they created.
Unlike in international markets, Indian markets ‘heroes’ are all investors. Successes of traders have not been documented by media. Whereas in the US and other markets, traders are seated on an equal if not higher pedestal by their worshippers.
Indian investors, nonetheless have many fund managers to emulate, with everyone having their own style of investing. What is common among all of them is that they have full confidence in their strategy and stick to it irrespective of the market condition. They have very high level of patience and buy and sell only when their conditions are met.
However, retail investors, both in India and abroad believe in copying the investments of their heroes rather than their investment strategy. They do not have the same patience that these fund managers do nor do they understand the premise on which the stock was bought. They end up selling the stocks on the first sign of weakness and blame the fund managers for not being as good as his reputation.
It’s not the fund manager who is to be blamed in such a situation. Most fund managers do not buy a company they like at one go. Rather they space their purchase and test the company’s performance before they complete their buying. A retail investor might just end up buying when the fund manager is placing his last order.
Unlike trading, investing will need a lot of time to show results. A retail investor looks for instant success, but an investor buys a stock for long term. Many investors buy stocks for perpetuity if they like the management, the sector and growth potential of the stock. Few retail investors have that kind of patience or wisdom of a professional fund manager.
We shall now look at some of the most famous investors in India.
Rakesh Jhunjhunwala: Undoubtedly the ‘rock star’ of fund managers in the country, Rakesh Jhunjhunwala, a chartered accountant by profession is a ‘god’ to his followers. Rakesh Jhunjhunwala’s investment firm Rare Enterprise manages his own wealth and a few other clients. Among the top holding of Rakesh Jhunjhunwala are Titan and Lupin which he has held for more than two decades. Value of Rakesh Jhunjhunwala’s current holding is expected to be over Rs 10,000 crore and picks up stock which he feels have a long term growth potential.
Nimesh Shah: Founder of the broking firm Enam, which was sold to Axis Bank, Nimesh Shah is as reclusive an investor as they come. He is rarely heard of in media and shies away from giving interviews. Yet Nimesh bhai, as he is known in the market, is one of the shrewdest and well-researched investors. He follows a bottom-up approach to investing and understands the company and its competitive space completely before putting in money. Nimesh Shah and Enam have been credited for bailing out Infosys when the company’s initial public offer (IPO) had failed. Many well-known and blue-chip companies have been identified by Nimesh Shah in its nascent days.
Professor Mankekar: Rarely have academics known to make money in the markets. Academics have been blamed not to follow what they teach, but this is not the case with Professor Shivanand Mankekar who has been as successful an investor as they come. Having a portfolio of over Rs 1,000 crore the professor is known to be in the right stocks at the right moment. Mankekar became famous because he identified and rode the retailer boom by betting on Pantaloon. This and much other stock picks helped him post a return of 750 percent in a decade.
Radhakishan Damani: Even the most astute of fund managers term him as a god of investing. General public came to hear about Radhakishan Damani or RK Damani only when his company DMart came out with an IPO. One of the most silent investor in the market like Nimesh Shah, RK Damani has been a bottom-up investor. Studying every company with a fine comb, RK Damani has been credited of being invested in almost every blue chip in the country. A visionary investor, who brought the same vision in successfully running a business by creating DMart, the most successful retail business model in the country, RK Damani is perhaps the only hugely successful investor turned businessman in the country.
Ramdeo Agrawal: Co-promoter of one of the largest Indian broking firm Motilal Oswal, Ramdeo Agrawal is considered to be India’s version of Warren Buffett. Agrawal considers Buffett his guru and follows more or less the same approach in stock picking. Agrawal advocates a concentrated approach in investing and picks up stocks which have a strong performance track record. Ramdeo Agrawal’s is credited for his financial model based style of investing where he likes picking up stocks with strong returns ratio in spite of the fact that the stocks have run up a distance. Agrawal managed one of the most successful Portfolio Management Schemes (PMS) in the country for a long time before the fund was transferred into the asset management company run by him.