How can an average investor identify the next Page Industries, Asian Paints, Pidilite etc. and why it is not as important as patience?
Everyone in the market is interested in finding the next Page Industries, Asian Paints, Abbott India, Pidilite Industries, HDFC Bank, Bajaj Finance.
Today I will share the exact secret to find them from the leaf out of Warren Buffett.
Why The Next?
The most important question is, why do you want to find the next of whatever?
Why not the stock itself?
So we assume the great companies are Page Industries, Asian Paints, Pidilite Industries, HDFC Bank, Bajaj Finance, etc.
So if they are such great companies, why aren’t you invested in them?
When you try to find the next does mean you have lost the money.
In 2008, HDFC Bank was a well-identified great stock, but even if you invested in 2009, you would have made 15x your returns.
Forget 2008; in the crash of 2020, investing in HDFC Bank does mean you doubled your money in less than a year time.
Still, people are looking to invest in a good Indian private bank but aren’t considering HDFC Bank. They are asking about Yes Bank / RBL Bank etc.
Similarly, people are asking me – will Indigo Paints become the next Asian Paints? My answer to the question is, I don’t know. However, what I know for sure is Asian Paints is already Asian Paints.
Patience Vs Idea – Leaf out of Warren Buffett
In equity investing, people are always looking for investment ideas, whereas they should be praying for patience like Warren Buffett.
Warren Buffett didn’t invest in the next Apple or the next Coca-Cola. He invested in Apple and Coca-Cola. He kept accumulating in the company over a period of time, and once he was satisfied with his position, he has the patience to remain invested.
Why we can’t invest in the current Page or Pidilite Industries, Asian Paints and then sit with patience.
The most important investing lesson out of Warren Buffett is investing in a company and then doing nothing. It is not about the idea. It is about doing nothing once you are invested in great companies.
Let the team do the business, and you do what you do best to analyze quarterly results and then hibernate once again on your investments.
Even if you invest in very well known ideas, you are fine if you invest in the business at the right price and then have the patience to let your investment grow.
You don’t need to find the next whatever. At least, that is what I believe in. You have to invest in the only found ideas in the correction and then remain invested in it.
If you believe that it is not about finding the next whatever, then here is a list of 40 such stocks that one can invest in them. You don’t need to invest in all 40 but study the one that you like and invest in the one that offers some discount on its price.