"Nilesh bhai, do not make those mistakes": Kotak AMC MD shares golden rule for investing

Market veteran Nilesh Shah says investors globally are all gun-ho on domestic stocks. In his recent interactions with global investors, he could see a sense of envy in their eyes and words. Shah said global investors felt India has some "divine right to win." The MD & CEO at Kotak AMC compared that belief to the performance of Indian cricket team, "which because of hard work and excellent performance is crushing opponents."`

But amid all the optimism,  the market veteran maintains a golden rule that he was taught by an investor. He was once told: "Nilesh bhai, do not make those mistakes that I can commit myself. When I give money to you, I expect you to behave professionally," 

As Shah recalls those words, he said his asset management company is by and large 'growth at reasonable price' investor, which invest in real businesses and at a reasonable price and where it sees growth runaway in terms of a trend. 

In an interaction with Business Today TV, Shah gave an example of manufacturing sector in India that he believes is a long-term trend. 

"People are diversifying out of China. There are many countries and India is one of them. The companies that can cater to domestic and export markets and become part of global supply chain management will be like pharma or technology industry of past; they'll deliver growth in profitability for years to come together. So basically, buying quality at reasonable price, wherever available," Shah said.

Shah said there were earlier worries over oil prices because of the Middle Eastern conflict but  Suddenly, Shah said, such concerns have eased, as the US is relaxing sanctions on Venezuela and that it has more oil reserve than Saudi Arabia and it ca also ramp up production over a medium medium term. That, Shah said will probably put a cap on oil prices for long term . 

On the other hand, there were concerns over US interests breaching the 5 per cent-mark, which did not materilise. Besides, there were worries over Monsoon, in the month of August. 

"We had high double-digit deficiency. Suddenly monsoon's recovered in September and we saw mid-single digit deficiency. All our problems are getting diluted, thanks to the divine intervention. But there's no credit being taken away from the hard work putting by the government and Indians," Shah said.

Shah said when the world was spending money in Covid, India behaved more prudently and is now repeating the benefits of the same.

"In some sense, we are like an oaisis in the global desert. Our problems are far smaller than what the world is facing. And our growth consequently is higher than what the world is seeing. In a very simple terms, From being follower of engine of global growth train,  we have become the engine, we are the leader of global growth train," Shah said. 

 

 

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