Lecture Notes: Ace Investor Basant Maheshwari on Stock Market Investing

Introduction

• Speaker: Basant Maheshwari, Co-founder of Basant Maheshwari Wealth Advisors
• Experience: Three decades in equity investing
• Focus: Strategies for consistent long-term returns

Early Interest in Stock Market

• Motivation: The lure of money, not initially passion
• Age: Started investing at 18
• First Stock: Hindustan Motors at ₹30-31
  • Preference for lower-priced stocks due to perceived higher potential returns
  • Challenges: Lack of internet, limited communication, high brokerage fees

First Multibagger

• Timeline: Took 12 years to achieve first multibagger (2003)
• Initial Approach: Buying low and hoping for quick gains, often unsuccessful
• Definition of Multibagger: Stock that increases 7-8 times over 5-6 years with growth and low initial valuation
  • Example calculation: Quadrupling earnings + PE ratio moving from 10 to 30 = 18-bagger

Important Attributes for Investors

• Patience and Resilience: Essential for long-term success
  • Personal experience: Patience wasn't a strong suit, more driven by stubbornness
• Understanding Styles: Following a style that works for you is crucial

Property vs. Stock Market Investing

• No Real Estate Investment: Never bought property, finds stock market more lucrative
• Economic Reasoning: Business income > Salary income > EMI liability
  • Business should generate significantly more than property EMIs

Final Takeaways

• Risk and Thinking Big: Key to creating wealth
  • Importance of accepting and managing risk
  • Cultural differences in perception of bankruptcy: India vs. USA

Conclusion

• Goal: Encourages big thinking and risk-taking for wealth creation
• Perspective: It's fine to go bankrupt, better to aim high and take calculated risks