Yesterday India lost one of its jewels of the fund management industry.
When I call him a jewel I am not saying that he was India’s best fund manager. About that the jury can decide, I am not interested in that debate.
I am talking about the ONLY MAN I know who avoided conflict of interest. He did not get into merchant banking, private placement, IPO funding, …he was just into fund management. He was at the peak of his career even 15 years ago – and could have EASILY created a big colossus of an organisation spanning equity brokerage, banking, insurance, …like some of his friends have done.
He chose the lesser walked path. He ran a PMS and has been running that for a very long time – and successfully. When invited to share a forum..he came at 4pm for a 4.30pm talk. He said disarmingly…I know as an organiser you would be tense…so I prefer coming early. I was to share the dias with him..and a couple of other speakers..one of whom came late. When that gentleman came in at 4.35…we were underway and PP gave me a smile. But then I never had to worry about what PP would speak ..he was always well prepared and could speak on any part of investor behavior.
I still remember meeting him in 1992-3 just post scam…and another person walked up to me and said…’did you book profits of Rs….cr….like our friend PP did’…I will leave the amount and the name of the other person blank (the other person died a couple of years ago at 67 years of age)…Parag just smiled. I had to ask him..’does this mean the figure is right..and he said NOTHING…
That was a time when he said..now that dividends are tax free a lot of wealth will be created in the equity market. He was also of the view that indexing will not work in India – at least for a long time. We can now say safely that Indexing did not work in PP’s life time.
An alumni of Sydenham college..he was about 9 years my senior..and a member of the Institute of Chartered Accountants of India..and his death is a loss for India.
I know that some of his clients were a little unhappy about his cash holding…but being a Value Investor is not easy, is it? And to run a PMS for a select clientele (he had high limits to start with)..is even more difficult. I guess the SEBI ruling on PMS etc. forced him to start a Mutual fund. I hope the succession planning is in place – knowing Parag Parikh I am sure it would be in place.
God give strength to his family – immediate, investors, shareholders, unit holders,…and other stake holders the strength to take the sudden, shocking news.
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