In the 1960s if you wanted to buy a house in Mumbai, you did not go to a builder, you went to 7 or 8 friends and said ‘let us form a co-operative society. Then you bought land, and then went to a builder and asked him to build a house for all of you. Funding was by Maharashtra Co-operative Housing Society..and the society paid a small EMI. Each individual was told how much he had to pay ….
Similarly you just waited for the company to give you a car. You could not really afford to make a full down payment.
Then came in Citibank, Standard Chartered Bank, American Express who gave us credit cards, car loans, and hey loans which could be used to buy homes. Of course by then Hdfc had come and had started disbursing home loans. Then the Indian banks like Icici and Sbi stepped in and gave huge home loans.
The Indian banks threw out the foreign banks in credit cards, car loans and of course home loans.
Wait a minute. Hdfc Ltd, Hdfc Bank, and Icici bank are Indian companies right? well, well they are registered in India and about 70% is owned by the same guys who owned Citi, Amex, Hsbc….LOL…So nothing really changed.
Now look at pharma. The Indian pharma companies are Dabur, Cipla, Dr. Reddys, Torrent…..now go and see who owns these companies. You might be surprised.
Is this a flash or a mega trend?
The Indian FMCG companies are Dabur, Godrej, Emami, …and of course Patanjali. They are beating the hell out of the ‘Foreign’ companies like HuL, etc. Waiting for a big Indian company in the sanitary napkin space, …these companies are likely to make a lot of money. We have already started getting reports of how Patanjali is pricing its soap at about half or less than that vis a vis HUL and toothpaste cheaper than Colgate.
Is it a fad or a mega trend?
Will these upstarts hurt the biggies? will solar power hurt NTPC and Tata Power?
Is it a fad or a mega trend?
One of the constants in investing is the retail investor behaves like the police in the Bollywood films. Reaches only after the event is over. It makes little sense to reach a party late. The drinks should have been announced – you cannot go when the guests are having their 4th tequila. Yes of course you can go there, but if it is a small party, you may have to just do the cleaning up by the puking of the earlier guests.
Why does this happen? Simply because we do not notice the changes that happen in front of our eyes. It took Bajaj Auto a long time to start making motorcycles. Similarly the small investor does not notice the trend. Worse, he has no clue as to how to react. Should you buy Sun Pharma at 400 or wait till it reaches Rs. 1200? what if they are hit by an US letter? Not easy to answer…
So he has to do a SIP – remember time weighted, rupee weighted returns are the best..go and do your SIP. Remember SIP does not make you rich 🙂 but you can meet all your goals…
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