Investing as I see it - Part 3

21/11/2025 - I believe Uber growth will be fueled by young people disliking owning cars.

21/11/2025 - I feel that in the long term , Kotak Bank is going to list its subsidiaries creating a good value for shareholders.

Correct Business in Correct Industry run by Correct Promoter at a Correct Price is a Correct Decision, Enough for a lifetime.

~aadhar©

There was a time I suffered a 20% capital loss in a company called SBI Cards. Whenever I went to investor calls , I could never see the management bothered.

I could see the MD and CEO of SBI cards will move on to some other SBI group company in near future. His future was secured and no skin in the game .Thus, he would be unaffected if the stock did not recover even for the next decade.

That's when I decided that next company I buy should have their lives , their children's future and their networth dependent on the stock price.

And I wanted someone who was competent and valued the minority shareholders.

I sold all my SBI Cards position at a loss of North of 20% and put that in Divis Labs. And it recovered everything for me and more. I bought at 2900 a piece and sold all my position at 4500 a piece after an year. I sold too early. Today it trades at north of 6000. Divis literally was my first correct bet. What a great business to own if you get at a fair price!

The way I explained stock market to my father - There are a few competent Indian businessmen who value integrity and have a good sense of capital allocation. They are building the businesses for their future generations to run. They and their family hold the majority 50% stake . It's their life's work and reputation.

And we can become their children by buying shares of their business at a fair price and doing all the due diligence.

Then , I say , we don't need to do a thing.

All great businesses are NOT necessarily great investments.

All stocks you invest in MUST be great businesses.

~ aadhar©

Last Minute Check List ✅

We are buying for Eternity . => No one has the time to check QoQ . It has to be a bet which CANNOT go wrong in the next 5 years.

Make sure to buy Wonderful Quality business at a fair price, NOT cheap deap value public sector stuff. =>Share price is affected by 2 things alone . Valuation ( price to earnings / Market cap to Networth) and Earnings Growth. =>The challenge is to find Quality trading at fair price and load it up. Check the Price to Book and see if market is valuing it correctly wrt to its ROE.

We buy a GREAT Growing Business which is gaining market share from competitors NOT a Pidilite or Nestle like Defensive ROE business. => Check it's ROE track record over the years. Is it growing ? Is the revenue growing ? Is the earnings of the company growing ? Is it gaining market share ? What are the levers of growth ? Is it overpriced ? Is it in sunrise industry? Can it be disrupted ? Is there a Right to Win ? Is there a Moat ? Is there a Regulatory authority ? WHY WHY WHY ?

Promoter Holding should be significant. It should not be public sector. We NEED a fanatic promoter who has great track record of execution over the years

What is the downside ? If my thesis is bogus, what is average P/B and P/ E of this stock and will we lose money. And how much money ? Buy at a valuation where you don't lose money .

Invert always Invert.

The curios case of SBI Cards. [ No share price appreciation in last 5 years ]

• high price to book and PE
• less roe like 14%
• less growth in sales
• public sector with no accountability
• NO promoter's skin in the game like Divis or Cholas or Bajaj.
• not a growing roe. A declining Roe.
• declining earnings / profit growth
• high peg
• high credit cost means cost of money for lending
• erosion in market share. Decreasing market share.
• regulatory pressure by RBI
• Increasing Operating cost

If you know what to NOT buy, half the job is done. Invert , Always Invert.