Investing in the Stock Market: Vijay Kedia (Full Transcript)

Full text of investor Vijay Kedia’s talk: Investing in the Stock Market at TEDxDSBinternationalSchool conference. In this talk, he discusses the benefits of investing in the stock market through his own life examples and the way he became financially independent.

I learned this lesson that nobody in the world is invincible, and I learned the lesson of stoploss in life.

– Vijay Kedia

Listen to the MP3 Audio here:


Vijay KediaMD of Kedia securities

My failures in life have been my biggest assets. If I was not in stock market, I would have been in the army.

So, when I was in class seventh, I wanted to join NCC. So, when I approached the NCC Department, I was told that I am late for the admission, because admission is closed 15 days back, so now I have to come back next year, so, but I was very much desperate and didn’t want to lose by one year.

So, every day whenever NCC class used to take place, I would just go and stand outside the NCC class and watch and listen what is happening inside.

So, one army officer used to come there to take classes. One day he saw me after three or four classes, he saw that I’m always standing outside the class. He called me in and asked me why you were standing outside. I said because I wanted to get in but I am late for the admission.

So, somebody from the class told him that sir, he’s a good singer. So, he told me: Okay, sing one song. So, I started singing a song, then he asked me to sing another song, like this I sang four or five songs. He was very much impressed and he took me into NCC.

So, there I learned this lesson that perseverance, if you want to get something in life, you have to be asked for it. Don’t just give up.

When I was in class 10th, suddenly my father died. And I had to appear for the exam… for  the final examination, which I failed. So, the future for education was over for me from that day.

But one of my distant uncles approached headmaster and told him the fact that my father had died three months back. So that headmaster actually gave me another chance to reappear. And the question papers were also set little easy so that I can pass; I somehow passed.

But after that I was no more interested into study, I was only interested in grow faster so that I can support my family, as I am coming from a humble background in one bedroom, we six of us, our family used to live and we did not have any savings or any capital and all.

So, I thought that let me… I should do something for myself or for my family. So but somehow actually, my mother approached one astrologer and astrologer told my mom that don’t worry, your son is going to be in the biggest University of India. But actually, astrologer was also failed because I did not go beyond my graduation.

When I turned 19, I joined the stock market and started trading, because that was the only thing I could do in my life without education, without experience, without capital, without savings. It was that time it was very much unorganized, like gambling.

So, I started doing trading. And I really did well for six months or one year and I started supporting my family. I thought that I’m really invincible, and I have really learned the trick of the trade and I am going to become a crorepati, millionaire very soon.

But suddenly that luck, which was actually doing that, what was playing with me, the opportunity started slipping out of my hand. And now my losing trades were more than my winning trades.

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So, there was one incident where I, you know, received a lot of… I had a lot of losses. And the situation came to this extent where I had to… where the situation came where my mother had to sell, about to sell her jewellery to pay off my dues. So, I was in really distress, I prayed to God to save me and somehow God actually saved me.

So, there I learned this lesson that nobody in the world is invincible, and I learned the lesson of stoploss in life. And also, I learned that prayer really works in life.

After that, after a few years, I got married with a lot of difficulty, because nobody was willing to give me their daughter to a person who does not have a separate room to keep… to live with his wife and who does not have a stable income. So, somehow a girl you know got ready, bad luck to her or good luck to her. And I got married.

After a year I got a son also. But things were little hand to mouth only. There was one incident where I did not have even 14 rupees to buy a box of milk Lactodex to feed my son. So, things were going on.

So, I thought let me do something else. Also, in my spare time I started supplying material into tea gardens in and around Kolkata. I was born and brought up in Kolkata only. So, I started supplying materials in tea garden.

There was one incident where I had some money and I was going to buy one stereo system, some expensive stereo system because I was very much very fond of singing music and all. So a friend of mine advised me not to invest, not to buy something which is a depreciating asset.

He told me instead of buying some depreciating assets, you should buy some appreciating assets. I understood and I bought a cheaper stereo system and rest of the money, whatever balance I had I invested into stock, I bought some silver.

Then I thought let me do something and let me try my luck in Mumbai because Mumbai was and is still the financial capital of India. So, I approached one of my distant relative who was living in Bombay, the wealthy person, I asked him if he can get me into stock market because stock market my first to last love… first 200 love was stock market only.

He said okay, he knows one of the brokers, you come to Mumbai and I will get you into stock market.

So, I went to Mumbai, I approached that broker through him, the broker made me sit outside his office for three, four hours for three, four days. And he was a very nice person; after that he called me one day inside and told me: Look, my son, you don’t waste your time; it is impossible to get into Bombay Stock Exchange. So, you please don’t waste your time and go back to Kolkata.

So now Bombay chapter was closed for me and I went back to Kolkata.

So, after four, five years, again, one of my friends who had shifted to Mumbai into stock market, I approached him and asked him to if he can get me into Bombay Stock Exchange, he said, okay, you come to Mumbai, I will get you into Stock Exchange.

So, I came to Mumbai, stayed with one of my cousins in Malad, and every day I used to travel from Malad to Churchgate by train to go to Mumbai Stock Exchange. So, I did the same thing for three days. Fourth day I was so much suffocated, and I’d become claustrophobic, then I get off at the next station of Malad, came to my sister’s house and told her this is not ever I have done in my life and I can’t travel by train, it is so crowded, so suffocated.

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So, I stayed in Mumbai for three four days and after that, I left because I did not have money to go by taxi from Malad to Churchgate and come back. So, I thought this Bombay chapter is closed for me. I went back to Kolkata.

Then after six months of staying again in Kolkata, I decided it is better to die in an ocean rather than dying here in Kolkata Hooghly River, I took another attempt. Yeah, so I took another attempt. And I found out a paying guest system in Cuffe Parade, where they had… that servant quarter they used to convert livable and used to give for paying guest and all.

So, I came and stayed there. And for next one year, one and a half year I kept on changing the place. But that was the time after one and half year, that was the time that bull market of the century, bull market of the century began… started, that was way back in 1992.

So whatever 35,000 rupees worth of shares I had brought from Kolkata to Mumbai, I sold that shares and invested in and traded into one share, which after one year, went up by 10 times. So that was my first moon-shot of my life. And I bought one bedroom one kitchen flat in Jogeshwari East because that base was very low.

And I called my mother, my wife, my two sons and my younger brother, we six of us started living there. After that Harshad Mehta scam broke out, and the Ketan Parekh scam broke out, I lost a lot of money, but I still I saved at least house and some shares.

Ketan Parekh scam was so severe that Kolkata Stock Exchange actually failed, okay. And the situation has become so painful here in Mumbai that people thought the stock market is not going to revive for next five to 10 years.

So, I had nothing else to do. So, one of my friends has shifted to Germany, Frankfurt, he offered me: Why don’t you come and join me as a partner; let us do something together.

So, I went to Germany and stayed there for 16 months, and in finding some new line and all but from there also I was always observing and you know, trading into stock market here in Mumbai.

After 18 months, nothing happened. I spent a lot of money whatever liquidity I had, I had spent in my traveling every month I used to come to Mumbai to meet my family or sometime I used to call them to spend a lot of money in traveling and living… Germany living is also very expensive, Frankfurt, basically.

So, I was very much disappointed and very much frustrated. So, one day I was going… one night I was going from Mumbai to Frankfurt again, but I was not one who can give up easily. So, one night I was going back to Frankfurt by Lufthansa flight and the flight was… the doors were closed and the flight was about to leave; I started shouting: Oh, let me get down. Let me get down. You know, and the airhostess actually understood my situation, I was really panicky somehow, after a lot of drama they let me go.

And when I went down, police was standing there and a doctor was standing there, and they checked me they found that my blood pressure is 165/125 they understood that I was faking; it was a genuine thing and they let me go.

After that claustrophobic attack second time which came was so huge that for one year I did not step out of my bedroom. I was confined to my bedroom. I was afraid of going into the lift, going traveling in the car, going in a hotel room which has you know locked a window and or even in the movie theatre and all.

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My spiritual guru told me that time you don’t do stock market. Don’t think about stock market, otherwise you will go insane because your mind is not in order.

So, my only job was to sit in my room or sleep on my bed and watching at the ceiling. This is what I did for one year. So that was the time actually mother of all the bull market… after one year after that one and half your mother of all the bull market started.

And since I was always… by by mind, I was always active in the stock market, I participated in that bull market and I started doing trading. And whatever money I got from that trading, I invested in three such shares, which went up by 100 times between 2004-05 and 2015-16. And I was the largest shareholder in those three companies.

In between I got an offer… around 2009 I got an offer from a tea garden which was up for sale, I realized this is the same tea garden where I used to supply materials, I bought the tea garden. In between I was offered a bulk of shares of a dairy company which was into milk products or milk and milk products. I bought that block of that company and gifted to my wife and told her this is your reward for that 14 rupees which we could not arrange.

After that, I was invited by so… almost many top-notch businesses school of India… universities of India as a keynote speaker, including Welingkar or SP Jain or IIM Ahmedabad, IIM Bangalore, even London Business School or TEDx, now I am here today in front of you.

So, in between I was also conferred an honorary doctorate. So, currently I am the largest shareholder in more than 15 companies largest after the promoters.

So, whatever little bit success I have got so far, that is because of my faith in Indian economy, my love for stock market and my focus on investing.

I think in last 28 years, gold has given 9x return and fixed deposit has given 10x return; equity has given 32x return in last 28 years. Idea is to stay investing for longer term.

India took 60 years to reach to $1 trillion economy, it took seven years to add another trillion dollar and now every five years India should be adding $1 trillion.

So, now, as Einstein had said that compounding is the eighth wonder, if you invest 10,000 rupees in any mutual fund or any stock which grows at 13%, then in 20 years your 10,000 rupees will become one crore.

So, this is my message to you that whenever you are going to spend 10,000 rupees in [Dara], Forevermark or Starbucks or wherever, think about that you are spending one crore rupees after 20 years later.

So, now the thing is this… the message is this: That money is the root cause of all the happiness, provided you have great health to enjoy it, a loyal family, loyal friends and loving family to celebrate it and a compassionate heart to share it.

At last, I’m going to tell you that few years back, I went to Germany, Frankfurt, stayed for 21 days to complete the trip which was incomplete.

Thank you very much.

Resources for Further Reading:

How Does The Stock Market Work? By Oliver Elfenbaum (Transcript)

How I Learned to Read – and Trade Stocks – in Prison: Curtis “Wall Street” Carroll (Transcript)

Safeguarding Your Money in Uncertain Times by Simon Mikhailovich (Transcript)

How Tata Built India: Two Centuries of Indian Business (Transcript)

The Psychology of Trading: Alessio Rastani (Full Transcript)