Vijay Kedia: Success Story, His Failures, Career as an Investor


Vijay Kedia Success Story

FinnovationZ Convey

4 Min Read    |    April 19, 2021

Vijay Kedia is a successful Indian investor. An ordinary person with unique investing skills he has been an inspiration and role model to many investors who follow his fantastic investing strategy for better growth.  

Let us look at his journey to the stock market which is full of ups and downs.

Success Story Of Vijay Kedia 

Vijay Kedia was born in a stockbroking family. He had a keen interest in the stock market since childhood. He started engaging himself in trading with his grandfather when he was 14.

After the sudden demise of his father, he wanted to start his own business but couldn’t do it due to a lack of required capital. Then he had to join his family’s stockbroking business. Soon, he realised that stockbroking was not for him. That’s why at the young age of 19, he started trading in the stock market. After jumping into the trading field, he received great profit in the very first year and became confident about it.

But, people who have even slight about the stock market know that loss or profit is not permanent. Well, beginner's luck ran out and Vijay Kedia went on to face significant losses while running for profit. 


Vijay Kedia's Failures 

  • He began trading with a small amount. Once he used to book even little profit he would go ahead with a bigger amount. Well, many times this practice cost him a lot and he had to bear huge losses 
  • Once, He faced a loss of Rs 70,000 in Hindustan Motors within 2-3 days. Sadly, to help him recover his losses Vijay Kedia's mother had to sell her jewellery. Although he recovered from the losses the incident left a huge impact on him. He felt utterly disappointed and dropped the trading job. 
  • After that, he started the business of supplying materials to the tea gardens in Kolkata, but unfortunately, he failed in that too. He went on for second innings in the stock market and began trading. Even after being in the trading market for 10-11 years, he didn’t get the desired profit. He realised that he is just playing a no profit- no loss game. That’s why in 1989, he decided to drop the idea of trading and moved towards investing. 

Vijay Kedia chose the route of investing and we are talking of the '90s here. There were no proper sources to learn about investing and no investors would be willing to share their knowledge and mantras of investing.

Two Strategies as a Beginner

  1. Trial and error - He believed to try something and if you fail, then learn from it. Finally, do the best next time.
  2. Observation - He used to observe the success as well as failures of other investors and used to learn from their mistakes. 

For instance, once upon a time, his friend had a big loss, and he told that he had to bear loss due to mistakenly investing in high P/E ratio stock. After that, Vijay Kedia analysed the whole situation and concluded that investing in a high P/E ratio could be dangerous. 

Vijay Kedia’s Career as an Investor

While starting the career of investing, he has been updating himself by reading newspapers, business magazines and the company’s annual reports. He still does these activities and has adopted a hobby of watching interviews of managers or CEOs of different companies. He was aware that stock related financing generally happens in Mumbai that’s why in 1989 he shifted from Kolkata to Mumbai. He had been living there as a paying guest for two years. 

His first stock in his investing career was Punjab Tractors. He had only Rs. 35,000 at the beginning of this journey and invested all in Punjab Tractors. Then, within the next three years, Punjab Tractors expanded to 4-5 times. After selling all shares of Punjab tractors, he invested in ACC Ltd. At that time the price of ACC Ltd. was only Rs. 300. 

Gradually, the ACC stock price rose insanely. Vijay Kedia found it more valued at that price that’s why he sold all his shares and bought an apartment in Mumbai and bought other stocks with the rest of the money.

A Failure in Investing: He was again at a loss and broken after the market crash in the Harshad Mehta scam. He clarified this and said, “I invested without analysing the management and quality of the company due to which those stocks dropped in the market crash and had to pay for my mistakes”.

After that failure, he never took his investment philosophy for granted and decided not to compromise in those strategies. He purchased Aegis Logistic at Rs 14 and sold later at Rs 500 in which he received 4000\\% returns. He has earned a lot of returns just like this. He bought Atul Auto Ltd at Rs 5-10. There was no movement in the first 4-5 years, but Vijay Kedia believed in his strategies and management of Atul Auto Ltd. After a few years, their stock expanded above Rs 500.

This displays Vijay Kedia’s excellent patience.  

Vijay Kedia's Investing Qualities 

He always says that to become a good investor, you should have three qualities:

  • Knowledge: To search for the best stocks. 
  • Courage: To purchase those stocks at a sufficient cost. 
  • Patience: To hold that stock with great patience because sometimes the market takes time to know the real value of the stock. 

Priorities for Choosing a Stock

Management of Company- He gives a heavy weightage to the fact of management and invests his time to analyse it thoroughly. Once he gave an example to explain why the management of the company is important:

E.g. Company's growth is like a highway, and the car is the company, shareholders are the passengers in that car, and management is the car's driver. Then he says- No matter if the car is Alto or Mercedes and the highway is good or not, the driver (management) who is driving the car or running the company should be skilled.

In the end, the company and passengers both of their destinations are in the hands of the driver. That’s why management plays a critical role in the company and stock investing.  

His Suggestion to Investors

  • Analyze the Management of the company: Any investor should look for the management of the company and how the management has been running during a lousy time of the company. According to him, if the management can deal with the company's performance in bad times and lead towards good conditions, then the management is considered best for the company's growth.
  • Analyze the future state of the company: Investors should analyse the future projection of the company and view whether management is ambitious towards the future growth of the company or not. 
  • Fix Income Source: Investors should make a fixed income source for them because the stock market is kind of volatile in nature, and you can’t depend on it. 
  • Stay Updated: Investors should always read about the businesses newspapers, magazines because knowledge leads you to search for good stocks.
  • View of the stock market: Investors should see the stock market as an investment and not as something you become a millionaire in one day. 
  • Required traits: Investors should have patience, skill and experience to become successful. 
  • Learn from failure: He makes his investing strategy with high research and analysis. Then executes accordingly. He has failed so many times but always takes lessons from them and still makes a huge profit from them. 

He says,

I had paid a lot of prices to become a successful investor. I faced losses and invested my years in understanding the mechanism. Today I’m in this position because of my mistakes after facing so many ups and downs. I have followed my passion for perseverance and succeeded in this game.

He usually seems active on Twitter and shares his experiences. So, you can easily follow him there.

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