After saying so many things about my blunders, let me tell you the companies where I made some money too! Lest you think of me as a bumbling idiot…and let us see if there is a pattern.
The companies which earned my family nice money are Coromandel fertilizers, Hindalco, EID Parry, Tata Motors, Cummins, Tata Steel, Tata Power, Tata Investment corporation, Tata Tea, Tata Chemicals, Hdfc, Hdfc bank, Hindustan Oil Exploration, Carborandum Universal, Hero Honda, KCP, Areva, Reliance Industries, Indian Hotels, L&T, Grasim, Titan, Cholamandalam Investment and finance, Colgate, HUL, Gillette, P&G, Basf, Cadbury, Hoganas, Kodak, Biocon, Ntpc, Siemens, Lakshmi Machine Works, …please remember these shares were bought in the 1950s (before I was born), 1970s (Fera dilution), 1980s (Hero Honda is perhaps the youngest company in this list), – amazingly long holding period. The dividend income is sufficient to pay for the day to day expenses and right issues if any. Some of these shares were bought in an IPO and some in the secondary market..
Notice a pattern?
1. Barring a few all very, very focused companies.
2. Mostly in dull boring business. I did not make too much money out of Infosys, Biocon, TCS, Idea, Bharti Airtel, – largely my investments were too small. My fault.
3. Almost all the companies in the list are from ‘conservative’ houses – Tata, Birla, Murugappa, Hdfc – but the shareholder returns have been ‘aggressive’.
4. Other than 2-3 companies all other companies are very very high on ethics and corporate governance.
5. Only Cholamandalam’s activities were shareholder value destroying in the past 7-8 years, but now they are on a correction path (hopefully!). As a shareholder I did feel sad and unheard, but watched the ’employee without a stake’ shatter value. Recently added some more shares to the portfolio.
6. Kodak, ITw signode, Cadbury and Hoganas – were lost to a buy back. Surely will lose P&G, Oracle, Gillette, Basf, Ingersoll Rand, Mico to buy back, but now able to anticiapate this and am ready for it.
7. I added to these shares whenever I could. Can never forget this dialogue with my broker :
Broker: Buy 200 shares of Hindalco….(remember it was a Rs. 10 share)
myself: Oh, I alreay have it ..!!
Broker: (After a pause) I just checked with Mr. Aditya Birla (remember Kumar’s father?) he has no objection if you increase your holding by 200 shares” 🙂 🙂 🙂
So adding to my portfolio (when it is attractively priced) and selling when aggressively priced TO THE SAME SHARE has never been an issue. I have Tata power bought at Rs. 100 as well as Tata power sold at Rs. 1600+. It has never been an all or none kind of a game
hope there is a learning from all this…!!
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