'May Take 10-15 Years...': Manish Chokhani's Mantra On Stock-Picking For Good Returns

Investors only need four or five of companies with a strong high-growth outlook to bet their money on with patience to multiply their wealth, Manish Chokhani, director, Enam Holdings Ltd. He said that this was the mantra his senior, Nemish Shah taught him.

It may take 10 years or 15 years for the invested money to give returns. Investors should be focused to make 50 times or 100 times profit by investing in value businesses for long time rather than settling for 30 times or 40 times returns, he said.

One does not need to take any leverage or do derivatives, just find the right businesses and find the right persons running them and just sit tight, he said. Quoting Warren Buffett, he said that time in the market, playing with the right technique, will ensure one makes a profit. However, if there is no such strong factor supporting the business outlook of the companies investors are betting on, it's better not to invest, he said.

In the last five years, India has transformed into a less concentrated market. Earlier, eight or nine companies used to control 25% of the market cap, the next 11 or 12 companies controlled the next 25% portion of the market-cap — roughly 70 or 75 companies had all of India's market cap. It has spread out now. It will be hard not to find out companies with Rs 100–150 crore profit, he said.

In the last decade in particular, people organised the unorganised sector in India, such grocery business, Chokhani noted.

Back in the 90s, anyone who took away the money from public-sector companies was a natural winner because the competition was so low. Any company that expandeds into international markets whether it was IT or pharma and made a dent in the market and became even 3% of the global markets, the company became very large. The trend of taking away share from the government still continues, he said.