Jwalit Vyas of ET has done some fine detective work in tracking down the reclusive couple, Dolly & Rajiv Khanna, and ferreting out the top secrets about their stock picking process.
The first noteworthy aspect is that neither Dolly nor Rajiv is born with the proverbial silver spoon in their mouth. Instead, the couple had a rather modest beginning and had to struggle to make a living. Rajiv was academically brilliant and qualified as a chemical engineer from IIT Madras. After being employed in a low paid job as a “research person”, Rajiv was bitten by the entrepreneurial bug in the year 1986 and started a company called “Kwality Milk Foods”. His big break came several years later, in 1995, when Hindustan Unilever bought his ice-cream business for an undisclosed sum.
Now, flush with the funds from the sale and looking for avenues to park them, Dolly & Rajiv’s stock picking skills came to the fore.
Here again, it was not smooth sailing for the golden couple. Though they started investing as far back as in 1996, they had to wait ten long years before they tasted their first multi-bagger in the form of Hawkins Cookers.
The long wait gave the golden couple ample scope to hone their stock picking skills. Once they had mastered the art of stock picking, things fell into place for the golden couple and there was an incessant march of multi-baggers into their portfolio in the form of Wimplast, Cera Sanitaryware, RS Software, Avanti Feeds etc.
The second noteworthy aspect is that Dolly & Rajiv invest just like us – on an analysis of information that is publicly available. Jwalit has cross-verified this fact by talking to the managements of Liberty Shoes, Manjushree Technopak and Nilkamal, all of whom confirmed that they did not know Dolly or Rajiv personally. This is comforting for those of us who nurtured a lurking suspicion that Dolly’s incredible success was due to insider information.
The third aspect is that Dolly & Rajiv don’t have a strait-jacket formula when it comes to picking stocks. Instead, Rajiv used a fine metaphor to describe his investment strategy. He said it is like a “tennis match” where you have to change your game play depending on whether you are playing on a clay court or on the lawn. Similarly, your game-play for stocks has to depend on the market condition and you must pick ‘value stocks’, ‘growth stocks’ or even ‘momentum stocks’ on that basis.
One aspect that Jwalit has misssed out is that Rajiv Khanna is also an “angel investor” and likes to mentor young startups with advice and funds. His profile with Chennai Angels says that he is “deeply involved in investments in Indian stock market and other investment instruments“.
At the end, Rajiv Khanna has offered some inspiring advice for us. He says that we must treat the market as a “complex puzzle” and as an “exciting challenge” implying that it is a battle of wits and that we must learn to take the losses in the same spirit as we take the gains. He added that we shouldn’t obsess over the “money” but should focus over the “process”. If we get the “process” right, then the money will just follow. “Once you understand the game, making money is not difficult” are his inspiring closing words.