Slow Compounding

The Unspoken Words Bajaj finance is down today by 7%. Because it was trading at higher price to book value. As the AUM growth is slower than expected in this quarter, the fall was inevitable....Final verdict: Valuation matters....you will hear such comments by Market pandits. Any place the pandits get any scope, they will show their wisdom by scaring the people about valuation. Strange part is, you ask the pandits about the correct valuation...they will never have an answer. No pandit will tell you that you cannot see the future. It is extremely difficult to guage the valuation. Rather, we should focus more on increasing the holding time. The longer is your holding time, lower the impact will be your buying prices. After 7% drop in share price today, the share is still up by 33% in portfolio. Because my holding time is now around three years. And I have not sold any units during covid fall and many more. Kept calm and focused on increasing the holding time. In this three years, it has outperformed Indian Nifty 50. It has also outperformed all foreign tech companies we dream to invest (Apple, Microsoft, Google, Netflix, etc). Pandits will scare you saying valuation and size of Bajaj finance. They will never tell you that increase the holding time of good business and keep patience. Always remember that growing loan book of a lenders is not a tough task. Managing Capital adequacy ratio and NPA are. So, do not let the pandits distract you. P.S. Invested in Bajaj finance. View can be heavily biased. Not any recommendations

Accepting Mistakes None of us wants to make mistakes. However, mistake is part of the courses. So, it is important to know how to deal with mistake. There are some areas where small mistake can cause a havoc while other places, we can breathe with a bit more margin of error. In a cricket match, batsman needs one ball to get out. It does not matter how good a batsman plays in earlier balls. He has to walk to the pavillion if he is out on the next ball. Very tight margin of error. If one famous surgeon (no matter how successful he/she is) commits a blunder in OT, his earlier reputation will be at stake. Very Very tight margin of error. On air, if an aircraft is flying (without backup engine) and the engine stops working...can you afford that? Zero Margin of error. There are many such examples in real life where we can see such tight margin of error. And we try to avoid mistakes when we sense a minor hint of that at the earliest. Strangely enough, in investing, there exists a huge margin of error. One can do well even after committing lot of mistakes. In fact, John Templeton once said.. The best investors are wrong at one third of the time. Most of the investors cannot comprehend this fact that we don't have to be right all the time to do well. Even with high error rate.. ✅ If you be patience, ✅ If you don't put more money in losers, ✅ If you don't cut your flowers ✅ Let your garden grow with patience... You will probably do well. Accept Mistake. Be patience. P.S. Made mistake and met with a minor accident. Took some time to recover. Will make video in a week. One change in investing pattern from next year. Will communicate through the video. Thank you for your wishes.

Divis Lab

Abbott India (Ignore the price)

Risk "Risk’s greatest fuels are leverage, overconfidence, ego, and impatience. Its greatest antidote is having options, humility, and other people’s trust." - Psychology of Money, Morgan Housel

Abbott India Revenue up by 16% Expenses up by 8% Profit up by 42% (YoY) Quarterly basis: Revenue up by 6% Expenses remains flat Profit up by 29% Operating profit margin: Q2FY23: 27% (this Q) Q1FY23: 22% (last Q) Q2FY22: 22% (last year same Q)

Berger Paints Revenue up by 20% Expenses up by 23% Profit down by 6% (YoY) Quarterly basis: Revenue down by 3% Expenses down by 2% Profit down by 20% Operating Profit Margin: Q2FY23 (this Q): 14% Q1FY23 (last Q): 15% Q2FY22 (last year Same Q): 16%

Deepak Nitrite Revenue up by 38% Expenses up by 29% Profit down by 31% (YoY) Observe the gross margin eroding Q2FY23 (Now): 14.2% Q1FY23 (Last Quarter): 17% Q2FY22 (Last year same Quar): 22%

Pidilite Revenue grown by 14% Expenses up by 20% Profit dipped by 8% Gross Margin 17% this quarter which was 21% Gross Margin

Dr Lal Path: Result outlook and expectation of Market

PI Industries Revenue up by 30% Expenses up by 26% Profit up by 30% (YoY) Quarterly basis: Revenue up by 15% Expenses up by 11% Profit up by 36% All businesses go through headwind, PI Industries had its bad time three four years back. It's now back to form again.