Radhakishan Damani has been great investor in Indian stock markets. His life history is such an inspiration for anyone who wants to succeed in life and in stock markets. We can find out the top holdings of Radhakishan Damani, how he started DMart and his investing journey in general which will change the way you think about life.
Radhakishan Damani entered the retail market in the year 2002, and today, after nearly 18 years, he is just one spot behind Mukesh Ambani, the richest man in India and also his same street neighbor.
According to the latest reports of Forbes, Damani now stands as second India’s richest man whose net worth is around Rs.1.2 lakh crore.
About Radhakishan Damani
Radhakishan Damani was born in 1954 into a Marwadi family who lived in a small place Karad based out in Maharashtra. As he hailed from a Marwadi family, they already had ties with the stock market.
He was raised in a single room apartment with his father, Shivkishanji Damani, who was already a part of the stock market in Dalal street.
Radhakishan Damani studied commerce at the University of Mumbai but dropped out of his studies after one year. He doesn’t consider himself not as educated as others but has turned out to be a self-made billionaire who started from scrap to build an empire for himself. Damani’s family comprises his wife and three children who form part of his business now.
Radhakishan Early Career
Radhakishan Damani started his career as a trader in the ball bearing business. Till then, he had no interest in the stock market. But unfortunately, due to his father’s untimely death, he was forced to step into the world of stocks. Later he closed his ball-bearing business and joined his brother, who was already a part of the stockbroking business then.
As he was new to the market, he had no idea what a stock market was like. In his late 20’s his main job in the stock market would be to stand at the farther end of the trading ring and watch Manu Manek, the dreaded market operator and the cobra of the stock market in the 1980s.
It was purely evident from Radhakishan Damani’s investment style that he learned a lot of tricks from Manek on how to spoil the bulls.
He used to stand idle in the stock market and rarely called out trades. He stood and understood the pulse of the market without making any trade. Later at the age of 32, he began speculation, and Damani made his first stock investment move in the stock market.
He also learned the art of short selling. However, later he realized that just with mere speculation, he would not be able to make or establish himself in this risky business of stockmarket.
Hence, he began to learn the ways to invest and also on how to grow his capital. While trying to understand this concept, he was strongly influenced by another value investor Chandrakant Sampat. Damani had to face many failures in his stock market life as he lost on many bets and later decided to hold shares for the long term to reap the actual benefit, and soon he began to succeed.
The cobra effect of Manu Manek had a lot of impact on Damani and his investment styles. He used to analyze all the operational strategies of Manek, and these proved helpful for him to overpower Harshad Mehta, who was the mastermind behind the most massive security scam in 1992.
Radhakishan Damani & Harshad Mehta
The stock market had seen its dark phase from the 80’s to the early ’90s, and that is the time when Radhakishan Damani came into limelight. The time when the stock market had seen one of the biggest security scams by Harshad Mehta and the time when Radhakishan and Harshad combated in business.
Radhakishan Damani, during that time, in order to defeat Harshad Mehta in Dala Street, formed the ‘Triple Rs,’ which was formed between Damani, a chartist Raju, and another rookie investor.
Both Harshad and Triple Rs first invested together in the stock of Apollo Tyres, which was an Indian tire company. The Triple Rs later realised that Harshad has bid high valuation for the company and hence began to shorting the stocks which they learned from Manu Manek.
This stock market battle continued for more than 2 years. Later in 1992, Harshad was accused of a huge scam, and Radhkishan won the battle and emerged as a prominent investor.
Later in 1998, Damani and Harshad again competed with each other in stock’s such as Videocon, BPL, and Sterlite, where Radhakrishna made a huge profit by using the technique of short selling which was not that a usual technique of that time.
Radhakishan Damani’s Investment Mantra
Everyone enters the stock market to take risks, but only a few like Damani are capable of looking beyond the numbers. From the very outset itself, Damani is known for his valuable investment. As rightly said, Man is known by the company he keeps, and Damani just follows it from buying the stock is exactly like buying the whole company.
His investment mantra is that ‘Investors must always look for value.’ As he says, the best way to invest in shares is always to look for shares that are beaten down in value and always look for bargains. Damani says to the investor to buy wherever you see the value, and if you carefully analyze his stock picks, you can see that he follows a pattern.
When Damani speaks about his investment mantra, he talks to the investors in the way to cover the risk and always protect your downside. Many proofs substantiate this mantra of his.
Damini identified VIP industries in the year 2008 when its value was only Rs.83 at that time. What he viewed in the stock was the excellent promoter and the quality of the product and demand the company was undergoing. In 2010, the stock value appreciated Rs.363, which is a profit of 317%.
There are so many examples in his portfolio that have made him reach to the position of the most valuable investment, and he calls them Value Picks.
Radhakishan Damani -Top Stock Holdings
In 1992 the, SEBI granted Damani with the registration as a stockbroker, and five years later, his membership was converted into corporate membership in the name of Damani Shares and Stock Brokers Pvt Ltd.
After strengthening his knowledge of the stock market, he has earned profit mainly through stocks like Tobacco Firm, VST Industries, Sundaram Finance, and Logistics Service Provider Blue Dart.
With his strong inspiration and influence of Chandrakant Sampat, who taught him how to unlock the worst intricacies involved in the stock market, he has learned how to tune his stocks.
The lucrative investment strategy and value investing, along with long term investment, are the key takeaways from the Damani’s investment life. Damani became the biggest individual shareholder of HDFC in the year 1995. He has also invested in GATI and TCI in 2014 and has held many MNC shares for more than 10-12 years before he sells it.
He had also earned good profits from real estate when the sector was down. Damani is a very positive and a shrewd investor and makes money when he is bearish. Here are some of the stock that Damani holds:
Radhakishan Damani Portfolio Holdings June 2020
|Stock name||Holding %||Market value in cr||CMP|
|Astra Microwave Products Ltd.||1.03||9.9||110|
|Food & inns Ltd||4.72||52||12.5|
|Simplex infra ltd||2.28||0.7||29|
|Prozone intu properties ltd||1.26||4.2||22|
Source: Check here
Radhakishan Damani and D-Mart
Radhakishan Damani always had an affinity towards consumer goods, and if we see his investment portfolio, you can understand the same. As an investor, Damani had tasted much success in consumer goods companies and was longing for starting a venture for himself.
After quitting, the stock market business, Radhakishan Damani founded his ‘DMart.’ In the year 1999, Damani, along with CEO of Reliance Retail, bought the franchise of Apna Bazaar, which was a Mumbai based co-operative organization that started its function in 1948.
As the 65-year-old had an eye on consumer retail, his ever longing desire to start his own business came true in the year 2002 with the launch of D-MART. They started with one store in Mumbai and now have more than 200 stores around the country.
D-Mart’s Initial Public Offering(IPO) listing was done under the parent name Avenue Supermarket. The IPO had an overwhelming response and opening in the National Stock Exchange and created a record sale. With this, Damani was placed in the list of Top 20 Indian Billionaires.
According to LiveMint, on the day of listing, the Avenue Supermarket stock rose by 114.3% from its offer price that was Rs.299. The market capitalization also touched Rs.61,731.32 Crore with a 54.37% increase.
Following the IPO in March 2017, Radhakishan Damani emerged as the retail king, and his wife and family stood as strong pillars for his success.
It is interesting to note that the valuation of DMART at the time of IPO was just 18000 cr, and in June 2020, the DMART’s market cap rose to 152700 cr. With this, the return on investment in DMART IPO has rolled to 9 times high within these years.
The Harshad Mehta Scam was a real eyeopener and a watershed event in the lives of many people who used to surround the trading ring in the 1980s and 1990’s. This has helped a good many who have moved from just being traders to the most valuable investors like Radhakishan Damani.
A few turned into different fields and became bigger league investors. But some investors like Damani branched out to set up their successful empire and business. The only thing that remained unchanged or constant is their passion for making money and the involvement and commitment to stay focused until they achieved their goals.