So, what is going to keep you busy this Samvat year?
Vijay Kedia: This Samvat, same thing. What has worked for you in the past should work for you in the future also.
But you have conviction in the stories right?
Vijay Kedia: Yes, of course.
Tell our viewers a little bit about those stocks which have not performed at all, but you believe in the story.
Vijay Kedia: Yes, many stock like Repro India is one of my biggest holding, did not perform for last five years. For five years just imagine and five years before also the price was same Rs 500. Today, also same price. Similarly, like Vaibhav Global, it is one of the big chunk of my portfolio also did not perform at all in last three years. So, that is a separate thing that before three years they had, like Vaibhav already multiplied 10 times or something like this, but that does not matter. We are still in the race. So, I have to compare myself not with my past performance but the players who are running along with me. This is how you evaluate yourself. So, like this there are a few more stocks. Meaningful holding I am having in Repro and Vaibhav which did not perform. So, what has performed? What has performed is what we want to know from you. What has performed? I think Atul auto has done well for you. IndiGo has done well for you. Vijay Kedia: Atul Auto reasonably done. Tejas Networks has done little well. It is 100% up in last one year. There are so many stocks which are up 200%, 300%. So, I am still lagging behind. So, it is okay.But does it matter lagging behind the others when you are making 100% because people are getting a lot of FOMO as well. Vijay Kedia: I will tell you, the race has not over yet. So, I am running a marathon. So, maybe in five kilometres you are faster and you are ahead of me, but till the race is over or till the last player is played cricket match is not called off. So, I am still in the game. So, I am still hopeful. So, maybe next year I will cover it up.
No, I am asking do you have any interesting sectors that you will look at closely?
Vijay Kedia: No, interesting sector like whatever sectors I am holding I am hopeful that if they have not performed in the past they should perform in the future and personally I will tell you that I am bullish on Chinese shares. I think that China is the new story. China is the new theme and I think this Chinese stock should do well going forward.
Because of the valuation?
Vijay Kedia: Of course, valuation. For 15 years they have not done anything. You just imagine even Hong Kong index was some 32,000 or 34,000 in 2008. It is still hovering around 22,000 or 20,000 or something and 14 years and we are I do not know eight times plus or nine times plus we do not know.
Would you allocate 5% of your capital to China? Are you that bullish on China?
Vijay Kedia: Yes, I will. Of my portfolio?
That is a big call, allocating 5% of your total portfolio in a foreign market, that means you are taking a sizable bet.Vijay Kedia: I would like to take sizable. I would like to invest.
So, China has two type of ETFs. One which are country ETF which also financial stocks in them, one are specific ETFs which are manufacturing battery.
Vijay Kedia: Yes, altogether, mixed which is listed at Hong Kong or somewhere right.
So, if you are buying China, you are selling India. You always like to be fully invested. That is what you have done over the years what I have known you. Which means to invest in China you must have raised capital somewhere or sold some stocks. So, where are you selling?
Vijay Kedia: So, I have sold some shares. I have tweaked some shares. I have exited in this quarter.
You are still holding on to the original quantity of IndiGo if I may ask you a blunt and a direct question.
Vijay Kedia: Yes. Yes, I am holding IndiGo. Yes.
So, your portfolio is in public domain. Now, in any portfolio stock companies do not follow a linear line. Some may go through a mature curve. Some may go through a declining curve both price and in terms of earnings. Which are the two or three companies which you think right now are in an exciting phase of earnings growth where next two or three years will be better than the last two or three years of your portfolio companies, where do you think incremental earnings growth would do? I just want to point this point out for our viewers that the reason why I am asking earnings and not prices because price is a function of market flows, technical, momentum. Earning is something what we can talk about, whether price goes up and down that is a different story. Where are you confident of earnings recovery or earnings re-rating for next two or three years, where there is going to be not incremental change but transformational change.Vijay Kedia: I will tell you like I have created one acronym SHIFTT. Smile is a generic term. SHIFTT is related to the sector. So, S stands for stock market. Any theme related to stock market or SIP or like whatever whether it is exchanges or like depository or whatever because this is the beginning of an equity cult. I have said this on various platforms that roti, kapda, makaan and data and SIP. So, SIP is the new trend and this is going to grow by leaps and bounds.
So, I think that S stands for like stock market you can call it or SIP or whatever and H stands for hospital and hospitality. I saw your interview with Mr Puneet Chhatwal and tourism minister and all with Ayesha.
So, what is acronym of SHIFTT? What does S stand for?
Vijay Kedia: S stands for stock market or SIP whatever you call it. And H stands for hospital and hospitality industry and IF stands for infrastructure, although I have sold one company but I am holding another company and I may increase, I may buy some other company. Currently I do not have anything in my mind, but without infra as I always say that we cannot imagine in India 10 trillion or 15, 30 trillion economy. We are still again at the beginning phase and double T, T stands for tourism and one T stands for telecom.
So, what will you buy in telecom? Tejas?
Vijay Kedia: I have interest in that. So, I will stick to that only.
Coming back to the point that Avanne was saying that a lot of investors that we have spoken with today and they are talking about energy transition being a big theme, real estate as well as of course the overall pharma space which has been doing well and renewables, energy transition. Are you not interested in digital and energy transition because they are supposed to be the theme of the next decade and not just few months and few years?Vijay Kedia: I do not have any particular stock in my mind in that sector. Like you are talking about, and secondly I do not invest in any fashionable sector, the trend or the sector which has become very known in the market or become very popular like data centre, everybody is talking about data centre or hydrogen and solar and this and that. I usually do not invest in such stories because by the time it comes to me it has become very pricey and everybody is now have some kind of involvement in these shares and all.
So, I do not have anything in my mind nor do I intend to invest in this sector because I think whatever companies or whatever sector I am holding currently, they should also perform well. Story in those sectors is not over yet. This is what I feel. I may go wrong, but ultimately I am going to do what I believe upon.
So, have you moved beyond Indian Hotels and tourism?
Vijay Kedia: No, I do not have Indian Hotel. I have Mahindra Holidays. I do not have Indian Hotel and of course IndiGo, unfortunately.
Mahindra you have half a percent equity ownership.
Vijay Kedia: Mahindra, yes, 1%.
You still own it?
Vijay Kedia: Yes, I am owning it. Mahindra Holidays, yes. Shares are not performing well, going slow.
So, I just want to go back to that whole point once again that in last one year we are talking about equities, but India has seen a massive wave of wealth creation. Real estate prices across India on an average are up more than 20% on an average they are up 50% in the last three years. The real estate sector now has a combined market cap of $8 to $9 trillion. Equity market, $5 trillion market cap, 80% is owned by Indian promoters and the investors which is the DII investors, that is about $4 trillion in terms of the wealth ownership and then there is gold, $2 trillion or $3 trillion we do not know but definitely there is a 40% appreciation there.
So, India has seen a massive wave of wealth effect which the country has never seen before. Gold, real estate, now equity. Wo kah rahe na buffet ho rakha hai abhi to, buffet table, you can choose. We were having a conversation in my house and my mom is like how much silver prices have gone up. My wife said you do not know how much diamond prices have gone down.
Now, we can see that in Titan. But what end of the asset class allocation you would now bet on? Just like you have gone to China, are there any other large changes which you want to do with your wealth distribution? Not just equities. For example, buy gold or buy bitcoin or for example buy real estate. Anything large which you can also share with our viewers as a thought which is non-equity?
Vijay Kedia: No, not in a meaningful way. I may be having around 2% portfolio of my worth in gold and maybe 1-2% in silver you know. And real estate I am having maybe 5% or 7% of my whatever portfolio I have. So, I would like to stick to that only. I am bullish on gold and silver also. And bitcoin too we cannot trade, we cannot invest.
But wo dil jo hai wo wala din fir bhi hai Hindustani wo equity ke saath mein hi hai, wo gold aur silver chahe wo equal return de, like everybody is talking in the last 20 years gold has given similar return to what Nifty, but what is the fun? You live for some climax.
Until and unless you take risk, what is the meaning of living? You need, right? So that kick is there in equity. So, I am not a person that 100% even if it gives me better return or similar return, I would invest in gold and just sit. Then, I will become inactive. Then, I will not enjoy that money.
