Notes (Masterclass With Super-Investors by Vishal Mittal and Saurabh Basrar)

● When you have a great idea, you need to backup the truck and buy.
● When a bull market gets over, leaders are squashed completely.

● New bull market will always have NEW LEADERS.
● When a stock is a bull market leader, people will come and buy at each
fall irrespective of valuation. Similarly when a bull market ends, bull
market leaders are squashed completely and it may fall to 20 PE as
well.
● Always think in terms of the SIZE of INDUSTRY.
● Victory has a thousand fathers, Defeat is an orphan.
● Judge the management based on what they said in the past and what
the company delivered.
● Judge the management on how they speak when the stock is going up
and also when the stock is going down.
● At the top of the bull market, news headlines will be very positive. At
the bottom of the bear market, news headlines will be very negative.
We can use this to time trend reversals upto some extent.
● Never use leverage in investing.
● The key aspect of an entrepreneurship journey is to learn to
DELEGATE.
● Average up when businesses are performing nicely.
● Compounding is 70-80% in investing.
● Growth and Quality contribute 50% each in stock’s return.
● There would always be things that you could not anticipate about the
future which could drive the price much higher/lower than you
anticipate and while an investor should always be willing to risk a
portfolio of his profits, he should protect most of it.
● Risk Management and Position Sizing are two very important traits in
investment style.
● Stock price can move upward/downward a lot more than you expect.
They can deviate from their fundamental value and can remain at an
undervalued/overvalued stage for a very long period of time.
○ Bull Market -> No limit on Upside.
○ Bear Market -> No limit on Downside.
● Companies which increase capacities without much dilution of equity
and debt i.e. through internal accruals tend to do better in the equity
market.
● Indian markets have traded in the range of 10-30 PE so be
opportunistic at lower end of range and be more cautious at upper end
of range of multiple.
● Write down ideas why you have bought/sold stocks and analyze them
after a certain time to make changes in investment strategy.
● If you go to dinner and try to eat everything you will not enjoy
anything. If you select one more two items that you like, you will
enjoy it more. Stock market is the same. Select your area of interest
and themes.
● Don't get married to stocks. Be quick to change your mind when facts
change.
● Always remain focused and don't try to chase fancy by going outside
your circle of competence.
● By investing in companies at the time of crisis you can make a lot of
money.
● People fear in a bull market that no shares will be available and there
is an unlimited amount of money that will keep coming into the
market. In bear markets, there is none to buy shares.
● DISCIPLINE and PATIENCE are two most important traits to succeed in
the stock market.
● Once a portfolio has reached a size, it’s better to grow consistently and
protect the capital as much as possible.
● You will be hit whenever you try to be greedy.
● You should not regret what is already sold (after price rises). If you
have liquidity opportunities will always come.
● Don't behave like God once you achieve some level of success. That
will ruin you.
● Read AR constantly to build conviction on your stocks. In absence of
the same you will follow what the market says which may/may not be
correct.
● When picking a new stock, look for Growth, RoCE, and Valuation.
● PE is a function of Growth and RoE. Even if growth is slowed down, PE
will sustain at high levels if incremental cash flows are generated at
high RoE.
● Market’s favourite combo: High Growth + High RoCE.
● The beauty of this business is there are no clear winners. You have to
make a judgement based on a few variables for which you don't have
any control on.
● Market does not realize the potential of the company if it does not
have growth.
● It’s not about right or wrong but it's all about how much money you
make when you are right and how much you lose when you are wrong.
● You can increase the chance of success by having better Margin of
Safety and not making unrealistic assumptions.
● You need to learn to say No to most of the ideas that don't excite you.
● Sweetest money is made in the final bull rally to top. Without being
smart, you should try to capture that last leg of market movement.
● You will get any company you want at any valuation you want. You
need patience and discipline for it.
● If you buy something that you don't understand, you won't know when
to sell it and you will get stuck.
● You should have the ability to Learn, Unlearn and Relearn.
● Once you invest in a stock, investment belongs to the market and
When you book profit, it belongs to you. One should not have
sentiments for investment that belongs to the market. If you have
attachment with the investment, you cannot make big money in the
market.
● If you buy a share and share price falls, you will regret not having
waited. If you buy and price increases, you will regret not having
bought more. So there will always be regret no matter what you do so
get out this mentality ASAP.
● Your mental capacity has to be higher than your financial capacity to
get success in the market.
● Courage is very important without which you cannot bet big.
● A goat does not take lessons of longevity from a butcher. You don't
take advice from bankers who want to make money at your cost.

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● When you have a great idea, you need to backup the truck and buy.

● When a bull market gets over, leaders are squashed completely.

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