Climbing the wealth ladder : A very interesting read.

If we use the 0.01% threshold as a guide, a working-age adult could use the following amounts to determine their wealth level (note: the x-axis is a log scale):

I choose these specific levels because, for each category, the marginal spending decision represents about 0.01% of the net worth level shown. Let me explain.

Let’s say you are at the grocery store and you are deciding whether to purchase a dozen eggs for $1.99 or a dozen cage-free eggs for $2.99.

If your net worth was $1,000, this single choice (paying $1 extra for cage-free eggs) could have a slight impact on your finances as it would represent 0.1% of your total assets. However, if you were worth $10,000 (or more) the decision to spend $1 more would likely be trivial to your finances since it represents less than 0.01% of your wealth.

Nevertheless, we can extend this thinking to more expensive spending categories as well. For example, imagine you are in a restaurant where you are deciding between a burger for $15 and salmon for $25. If your net worth > $100,000 then the $10 difference is trivial (<0.01% of net worth). If you continue to scale this logic upward you will see that the marginal impact of a single decisionwithin each level of wealth could be as follows:

• Level 1. Paycheck-to-paycheck: $0-$0.99 per decision
• Level 2. Grocery freedom: $1-$9 per decision
• Level 3. Restaurant freedom: $10-$99 per decision
• Level 4. Travel freedom: $100-$999 per decision
• Level 5. House freedom: $1,000-$9,999 per decision
• Level 6. Philanthropic freedom: $10,000+ per decision.

When you view wealth in this way, it looks more like steps than a smooth, ever-increasing line. This is because most people in the same level of wealth consume in much the same way. If you are in level 3, you don’t fly private and you only fly first class if you are lucky enough to get upgraded. If you are in level 1, you rarely fly.

More importantly though, the best way to climb the wealth ladder is to spend money according to your level. If you are in level 1 and you book a vacation without caring about the costs (level 4), then you won’t progress further up the ladder. Until you have the money to spend frivolously within a level, you have to be strict about your spending in that level. Get this right and you have a far better chance of progressing up the ladder.

Dear Hitesh Sir

I want to know how to find a reason why a strong fundamental stock with good valuation falls and sometimes correct 10-15 % from there high. How a retail investor should be cautious from these type of events.

Please share your views
Thanks

Nirmal Bang view on SCIL

We have marginally revised EPS estimates and raised target PE from 32x FY26E to 38xJune’26E based on healthy EPS CAGR of 40% over FY24-FY26 – implies PEG of 0.95x. The higher multiple is on the back of improved outlook for FY25E/FY26E in terms of margins and earnings growth. The new PE compares with median PE of 42.1x.

Key catalysts:
 Healthy monsoon forecast – already the deficit has turned into a surplus for Kharif FY25,
as per latest rainfall updates.
 La Nina is likely to set in over the next one month which is a positive for agronomical
conditions.
 SCIL launched 6 new products in FY24 – 3 herbicides, 1 insecticide and 2 fungicides
 Agrochemical input prices and de-stocking have mostly bottomed out, as per our channel
checks. Also, SCC Japan’s latest PPT has presented a bullish outlook based on
revival in its CPC business for April-March’2025 (FY24 as per SCC norm)
 SCC Japan is also focusing on more sustainable bio and botanical products for crop
protection based on its vast experience and R&D expertise; this is in line with its focus on
regenerative agriculture, as per SCC’s April’24 strategy PPT.
 SCIL’s new product launches as well as capacity creation are aimed at securing further
business in Agrochem and Specialty Chemicals. SCC Japan is shifting focus to
regenerative agriculture, specialty chemicals for mobile display (OLED) and power
semiconductors – according to SCC’s strategy PPT.

Yes, the price has been range-bound for quite some time. Holding since this March at 220 levels. Hopefully, breaks the range with strong volumes.