Don’t be disillusioned – Sensex has surged 60x since 1989: Stocks are always the best investment
Ramesh Damani is well aware of the fact that the novices of Dalal Street are presently a highly disillusioned lot.
All our aspirations of multibagger gains have turned to dust.
Most stocks in our portfolios have turned into “multi-beggars” and put us in a highly pitiable state of extreme poverty.
So, he grabbed the opportunity offered to him by Latha Venkatesh and Sonia Shenoy on the auspicious occasion of “Teachers’ Day” to give us a motivational talk.
“This too shall pass,” he said in a philosophical tone, implying that our troubles will soon end.
He also cited the example of the events of 2004 when Infosys, the blue-chip tech behemoth, had reported miserable results and sunk like a stone.
The entire stock market had also sunk in the wake of the earnings disappointment and it appeared the game was lost.
However, unknown to anyone at that time, the Infosys debacle had marked the precise bottoming of the market.
It surged like a rocket thereafter and went on an unstoppable Bull Run.
People who had braved the storm and bought stocks at the depth of the crisis became millionaires overnight.
“If you invest wisely in a bear market, you can reap the harvest in a bull market,” Ramesh Damani said, sending the clear message that we have to take full advantage of the present crisis to aggressively grab high-quality blue-chip stocks.
“India is a long-term bullish story and it has paid to be bullish in India over the last forty years,” he added emphatically.
He also reiterated his favourite message about how the Sensex has compounded at a rate of 20% CAGR and delivered a mind-boggling return of 60x since 1989 despite all the miseries that have plagued the Country.
RAMESH DAMANI: Index Has Compounded 18-20% Over Last 25 Years
— BTVI Live (@BTVI) July 4, 2016
When I came to the stk mkt in 1989, the Sensex was about 800 at that time. Today it is closer to 36k, gone up 50-60X. All kind of events have taken place in last 30 yrs, from Kargil to DeMo to fin crisis. But the index always finds its way higher – Ramesh Damani#indexfunds
— India ETFs & Index Funds (@IndiaEtfs) February 5, 2019
In fact, such is the power of the Index that even Warren Buffett, the World’s greatest investor, had to concede defeat after under-performing the Index for 10 long years.
— CNN Business (@CNNBusiness) February 25, 2019
Find mentors like Radhakishan Damani and Rakesh Jhunjhunwala
Ramesh Damani has always made it well known that he reveres the two Billionaire giants of Dalal Street, namely, Radhakishan Damani and Rakesh Jhunjhunwala.
In fact, on an early occasion, Ramesh Damani had heaped the ultimate praise upon Radhakishan Damani by equating him to the legendary Steve Jobs, the founder of Apple Inc.
“We all think Steve Jobs did great as he reinvented computers, publishing, iPhones. And here in India we have someone doing that. It is truly a gift of my life to absorb the energy and see the outperformance over a time,” Ramesh Damani said with pride in his voice at the great achievements of a fellow stock picker.
Ramesh Damani also lauded Radhakishan for his uncanny ability to be able to “smell” the market and decode whether it is a Bull market or a Bear market.
— BloombergQuint (@BloombergQuint) March 31, 2019
It is notable that even Rakesh Jhunjhunwala, the Badshah of Dalal Street, is a great admirer of Radhakishan Damani.
“If SSC Pass Like Radhakishan Damani Can Make Billions From Stocks, Why Can You Not,” the Badshah had asked us in a poignant tone.
Ramesh Damani advised everyone in Dalal Street to also find mentors of the caliber of Radhakishan Damani and Rakesh Jhunjhunwala.
“It really helps when you are young to have good mentors or guides to help you prolong your career. So I would urge people who are young and starting to read a lot and try and find good mentors,” he said.
My biggest regret – not buying Bajaj Finance
One of Ramesh Damani’s USPs is his willingness to reveal his mistakes.
On an earlier occasion, he had lamented his inability to think big.
“The inability to dream big is the biggest failing of my career,” he said in a mournful tone.
He cited the example of two stocks that he had realized (in his youth) were certified megabaggers, namely, United Breweries (McDowell) and Bharat Electronics.
However, instead of buying massive truckloads of these stocks, he bought piddling quantities.
The result was that when the day of reckoning arrived, Ramesh Damani was still an ordinary person.
“If I had bought 10% of United Breweries and McDowell when they were available at throwaway valuations, I would have been a Forbes Billionaire today,” he said.
“Great ideas are very rare. You want to backup the truck and buy because in a Bull market you want to be loaded on good stocks,” he advised the distinguished audience.
Ramesh Damani has also come on record to say that it rankles him that he is not a Billionaire while his peers are.
— ET NOW (@ETNOWlive) February 6, 2019
“You will never get seriously rich by buying 50 or 100 shares. When you get a seriously attractive opportunity, back up the truck with the stock” he advised.
The latest revelation by Ramesh Damani is that he feels bad about not buying Bajaj Finance when it was available at throwaway valuations.
“Bajaj Finance was in my area of competence … it was in my backyard in Pune, I visit it maybe four times a year … I don’t know how I missed it … deeply regret missing it because such high-quality businesses are very rare to come by,” he said in a somber tone.