Dalal Street, the financial nerve center of Mumbai, is the perfect barometer of investor sentiment. Till, a few weeks ago, Dalal Street was filled with the hustle and bustle of investors strutting from one place to the other, with a look of self-importance on their faces. Today, Dalal Street is deserted. A few homeless stragglers loiter around with a haunted and bewildered look in their eyes.
It is clear that the savage selling of the past few weeks, coupled with the doomsday predictions of George Soros and the eminent economists of RBS, has taken a heavy toll on investors’ confidence.
In these difficult circumstances, it is appreciable that the Gurus are doing everything in their power to help investors keep their faith in equities.
Porinju Veliyath is, as expected, at the forefront of the crusade by the Gurus. He has the largest army of 22,000 devoted followers. He keeps a close watch on the situation. When he senses that investors’ confidence is dipping to dangerous levels, he shoots off a barrage of tweets, each carefully designed to inspire his followers.
Porinju’s pet theme is to repeatedly remind his followers of the great returns that his PMS has made in difficult times.
I was bullish last year too; and made over 50% return on listed Indian equities in 2015 under PMS – stock picking is the game! BUY INDIA.
— Porinju Veliyath (@porinju) January 18, 2016
He also likes to remind them that the present crises is like a “discount” sale and that they should grab top-quality stocks at bargain-basement prices.
Nifty at new low – understand pain of traders! Don't see any reason for 'Investors' to panic. Remember, 'discount sale' won't last long!
— Porinju Veliyath (@porinju) January 20, 2016
Porinju also deftly slips in a “patriotism” angle to the issue:
I can only stay bullish on India and considering all aspects of global economic environment, not just because I am a patriot 🙂
— Porinju Veliyath (@porinju) January 19, 2016
However, it is notable that Porinju is losing some of the icy-cool temperament that he is famous for. Usually, when Porinju gets attacked by a disgruntled follower, he looks the other way and defuses the situation. However, lately, he has been getting into eyeball-to-eyeball confrontations with some detractors and escalating the tension. Perhaps, the strain of being a cheer leader is proving too much for Porinju.
Vijay Kedia is right behind Porinju when it comes to rousing the sentiments of his followers. He advised investors not to panic by reminding them that the crash has spared no one and that even he (Vijay Kedia) is a victim. He also advised them to tuck into top-quality stocks when the opportunity lasts.
All my stocks are down 5-25%. Happened many times in my life. But they are clean, best managed and have a vision. So less worried.
— Vijay Kedia (@VijayKedia1) January 19, 2016
The stock market is the only market where customers run out of store when things go on sale . ????????
— Vijay Kedia (@VijayKedia1) January 18, 2016
Basant Maheshwari has, in his new avatar as PMS manager, subjected himself to self-imposed restrictions and is no longer as free in his interactions with his followers as he earlier was. However, Basant has also recognized the seriousness of the situation and is doing all that he can to lift the sagging spirits of his followers.
The place to spend time now is to read more about the companies that you own than check the doomsday blogs of the self styled Nostradamus !
— Basant Maheshwari (@BMTheEquityDesk) January 15, 2016
Incidentally, Basant’s former/ current favourite stocks, such as HDFC Bank, Hawkins Cookers, Page Industries, Repco, Gruh etc, have managed to withstand the onslaught of the Bears without losing much ground.
So, Basant’s theory that it is better to pay a premium for a quality stock rather than to save a buck on a low-quality junkyard stock may be correct after all.
Basant took the opportunity of out-performance of his stocks to take a dig at unnamed gurus who advocate buying low-quality stocks.
@ChaviwalaZ Very few men left here. Only wet rabbits hiding under the carpet with the tails tucked between their legs !!!
— Basant Maheshwari (@BMTheEquityDesk) January 13, 2016
The other eminent gurus such as Samir Arora, Madhusudan Kela, Motilal Oswal, Ashish Chugh etc have also risen to the occasion and are doing their bit to boost the confidence of the hapless retail investor.
However, Prof Sanjay Bakshi, the authority on value investing, is the only guru who seems to be blissfully unaware of the mayhem in the markets. Though the Prof has a massive base of 15,000+ followers, several of whom are rank and file investors, he has so far kept a tight lip on the situation. Instead, he and his followers are merrily exchanging sweet nothings in the form of quotes of Warren Buffett, Benjamim Graham and other luminaries, and other esoteric issues.
Has anyone seen any discussion of this gem tucked away in Buffett's 1986 letter? https://t.co/J4PfMJFxyn including its wider application?
— Sanjay Bakshi (@Sanjay__Bakshi) January 13, 2016
What can an investor learn from photography?
— Sanjay Bakshi (@Sanjay__Bakshi) January 14, 2016
My guess is that the Prof’s casual banter on frivolous issues is a ruse. He is also carefully monitoring the situation and is probably working on a detailed treatise on the subject which will provide great insight into the crises, in the same way that Howard Marks’ Memos do. When the time is appropriate, the Prof will release the treatise and we will then have an opportunity to compliment him!