Last fortnight when I appeared on a ZEE, the anchor a good friend Swati said “Since Subra sir does not name the fund schemes we have another expert who will name them”. Of course I don’t mention names – I find it difficult.
Why do I find it difficult? Simply because when I am talking on TV, doing a video, writing a blog, or doing a training I am doing a One-Many communication. In such a place I cannot be consistent. I just cannot.
Let me give you an example. During my student days I have done audits of Psu undertakings. One thing is clear – psu’s have a lot of corruption. HOWEVER, their accounts are clean- clean as a whistle. If anything their profits are under stated. AS an example while doing the audit in 1983 I found that some “expenses” were written off – I found these were purchased as “guest houses”. Difficult to believe I found that this was the “houses” in which the athletes were asked to live during the games. This was done so that Rajiv Gandhi could stand in parliament and say “we have spent only Rs X crores on the Asiad”. The other expenses were thrust upon the profitable PSU. Birthdays of Indira, Nehru, etc. were occassions to spend crores on full page ads – expenses were borne by PSU. So the hatred for PSU was formed then itself, and it stayed.
Till I met Ashwin Mehta (yup Harshad’s brother, the more itellectual one). Must have been in 1990/91. He convinced me to buy some PSU shares – and all became multi baggers. I had since sold them. I went back to my belief that the government will misuse the money and the power. I know what all they do, and that would take a book to write. Of course it is not just the politician who misuses, the baboo(n)s also misuse. It is common to find that 4 cars, 2 hotel rooms in a 5 star hotel would be available to a secretary from the ministry. So if a baboo(n) from the agri ministry came, his friend from the Petroleum Ministry would organise the stay for his classmate. Seriously, I could write a book – completely useless for you, of course.
Also if I remove the bias I will also realize that PSU is not “bad at any price” nor are private sector companies “good at any price”. So I may take a view that HUL is over-priced, but Indian Oil, Ongc, Sail are inexpensive. So what view should I take on Psu shares now? I do not know. Yes, if you see the portfolio of Prashant Jain, Naren, and Roshi Jain (aka Anand Radhakrishnan’s Junior) I see a lot of PSU shares. Nobody in their right minds can say that “all the 4 of them are wrong”. Impossible. All of them have awesome long term track record. Most important thing I like about all of them is their strength of conviction. They did not waver at all. Naren and Roshi were always bullish about Bharti Airtel – and have been rewarded for being over-weight on that company. NS and AR are not so bullish on Reliance – and that does not bother me. FT and Hdfc both have an exposure to Indigo and both are bullish on Infra. Infra in India is PSU heavy.
Have I changed my mind? Well I can be swayed for sure, and these 4 people are guys (and gal) with good track record.
So largely my style is one of sheer laziness, and am willing to look like an idiot in the short run. I am fine with huge underperformance in the short run (say 4 years)..knowing that these are good fund managers. No, I really do not look for new fund managers – though I keep flirting with a small 5k sip – there are 10 of them at least. These will not alter my life much. For example many people are asking me “is it time to remove money from Hdfc Top 100, Franklin India Bluechip, Icici Prudential India Opportunities fund, Discovery fund, ..and my response is “I do not know”. I am staying invested in these funds. Sure there are other funds too like Hdfc Bal adv fund – I don’t believe its a bal adv fund, but it is an equity fund!
So when I keep changing my mind…how can I say something in a “one-many” addresses? I can do that only in a one-one interaction. That I have dramatically cut down.
Now you know why I don’t name funds. Sometimes I do…but really rare..
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