How a Veteran Investor Built ₹62 Crore Without Gold or Real Estate | Gajendra Kothari | FWS 97

Name: How a Veteran Investor Built ₹62 Crore Without Gold or Real Estate | Gajendra Kothari | FWS 97
Uploaded: 2026-02-14T12:30:55.000Z
Duration: 2 h 36 min 43 s

What is Gajendra Kotari's Investment Strategy?

Overview of Personal Wealth and Expenses

Gajendra Kotari discusses his portfolio, valued at 62 crores, and mentions he could afford luxury accommodations like the Taj Mahal Palace Towers.

His main expense is rent, which amounts to 3.5 lakhs per month.

Surprisingly, he does not own a car and travels by train.

Investment Philosophy

He invests 42 lakhs in SIP (Systematic Investment Plan) monthly and has paid around 5 crores in taxes last year.

Gajendra believes gold and silver are currently in a bubble and unsustainable for investment.

Contrarian Approach to Investing

He emphasizes diversification as a strategy suitable for most investors but notes that the top 1% think differently.

Gajendra shares insights from a fund manager whose underperforming fund indicates potential value opportunities.

How Does Gajendra Allocate His Assets?

Asset Allocation Breakdown

As of January 2026, his personal asset allocation includes 62 crores total wealth; with approximately 57 crores in mutual funds.

He reveals that about 85% of his investments are in long-term equities while the remaining 15% is allocated to debt or debt mutual funds.

Strategic Use of Cash Reserves

The cash reserves (15%) are intended for future market opportunities during significant drawdowns (20% or more).

Gajendra's Views on Market Trends

Missing Out on Recent Trends

Despite missing out on recent rallies in gold and silver, he maintains confidence in his contrarian approach to investing.

Historical Context of Investments

During the COVID market crash in March 2020, he invested significantly into small-cap funds when others were selling off assets.

Investing Beyond Conventional Wisdom

Bold Moves During Uncertainty

In years following COVID, he invested heavily in China-focused funds despite widespread skepticism about China's market conditions at that time.

Investing Insights and Market Psychology

The Paradox of Buying Low

The speaker discusses the irony in consumer behavior, where people are eager to buy a phone worth one lakh rupees for just 10,000 rupees, yet they flee from stock market sales.

This highlights a counterintuitive aspect of investing: during market downturns, investors often panic instead of seizing opportunities.

Human Nature and Investment Failures

Citing Nick Murray, the speaker states that "human nature is a failed investor," emphasizing how popular sentiment can lead to poor investment decisions.

When everyone talks about certain assets like gold or silver, it may be wise to approach with caution.

Importance of Price Over Asset Type

The discussion shifts to portfolio construction; the focus should be on what you pay for an asset rather than merely what you buy.

A good investment is defined by its price point—buying at 10,000 versus one lakh illustrates this principle clearly.

Portfolio Volatility and Risk Management

Common wisdom suggests mixing equities with gold for balance; however, the speaker challenges this notion by advocating for understanding volatility as part of risk-adjusted returns.

A smoother portfolio performance is preferred over chasing higher returns if it means enduring less volatility.

Diversification Strategies

The speaker emphasizes diversification across various asset classes (gold, real estate, bonds), likening it to a balanced thali that yields consistent returns without high volatility.

For most investors (99%), achieving around 12% CAGR with low volatility is ideal; however, the top 1% may seek more aggressive strategies.

Embracing Volatility for Higher Returns

The conversation reveals that suppressing volatility can also suppress potential returns. Embracing some level of risk can lead to greater rewards.

Personal Investment Journey and Lessons Learned

The speaker shares their personal experience starting with a modest SIP in 2010 and witnessing significant fluctuations in their portfolio value over time.

Navigating Market Downturns

In March 2020 during COVID's market crash, despite having invested significantly over ten years, the portfolio value dropped below initial investments—a stark reminder of market risks.

Long-Term Perspective on Investments

Despite experiencing losses after ten years of investing (down by 25 lakhs), the speaker maintained faith in long-term growth potential.

Recovery Post-Crisis

Following the downturn in March 2020 when their portfolio was valued at approximately 5.8 crores, it has since grown substantially to around 63 crores within five years due to strategic investments made during volatile periods.

The Journey of Financial Growth and Lessons Learned

Early Success and Subsequent Losses

The speaker recalls earning a salary of nearly 1 crore while in the UK, leading to a sense of confidence and financial security.

At age 26-27, during the 2008 financial crisis, the speaker attempted to time investments in FNOs (Futures and Options), resulting in a loss of 50 lakhs within six months.

This experience not only led to financial loss but also affected mental well-being; the speaker describes feeling miserable after losing all savings.

Turning Point: A Shift in Investment Philosophy

After returning to India with nothing, the speaker vowed never to engage in FNO trading again, realizing it did not suit their investment style.

Inspired by lessons from literature (specifically Warhammer), they adopted a philosophy of building wealth slowly and steadily through consistent investments.

Establishing Credibility Through Personal Investment

In late 2009, the speaker founded a company with a principle that any investment advice should be backed by personal investment—having "skin in the game."

They emphasize transparency by showing clients their own portfolio as proof of credibility when recommending investments.

Portfolio Growth Over Time

By 2014, after starting systematic investment plans (SIPs), the speaker achieved their first crore. Their portfolio grew significantly over subsequent years: from 6 crores during COVID in 2020 to 62 crores by 2026.

The growth is illustrated through charts comparing invested money versus market value; patience during downturns was key to recovery.

Lifestyle Choices Reflecting Financial Philosophy

Despite having substantial wealth (62 crores), the speaker chooses not to buy property, preferring flexibility over ownership—a stance aimed at living life on one's terms without being tied down.

They discuss minimal expenses primarily related to rent while maintaining an affluent lifestyle without owning real estate.

Living in South Bombay: A Personal Journey

Transitioning to South Bombay

The speaker reflects on their past, mentioning they lived near Vasai Road and started their journey with a small office in 2009.

In 2015, the decision was made to move to Churchgate in South Bombay due to increasing traffic issues, questioning the purpose of earning wealth if it leads to stress.

Despite family criticism for paying double rent compared to previous living arrangements, the speaker emphasizes the value of convenience and time saved by living closer to work.

Quality of Life in South Bombay

The speaker describes their daily routine as luxurious, being able to walk home for lunch within five minutes and enjoying top-notch infrastructure.

Living close to amenities like Marine Drive and local stations allows for a lifestyle where 95% of life revolves around a one-kilometer radius.

Traffic is rarely an issue; even trips to the airport take only 25 minutes without encountering traffic signals.

Financial Insights on Renting

The speaker shares that they moved into a rental property costing ₹1 lakh per month in 2010, which has now increased to ₹3.5 lakhs for an 1800 ft² three-bedroom house.

They discuss how their family dynamics have changed over time, with children now studying away from home while they continue living together.

Travel and Lifestyle Choices

The speaker mentions taking vacations abroad twice a year, including business class flights for significant events like Warren Buffett's annual meeting.

They express feelings of guilt about spending money on travel after previously flying economy class but recognize the importance of enjoying life.

Spending vs. Investment Philosophy

Emphasizing client relationships, the speaker encourages clients who have worked hard not just to accumulate wealth but also enjoy it through experiences like business class travel.

They advocate for spending money wisely rather than hoarding wealth solely for future security; this philosophy extends into their personal financial decisions as well.

With fixed costs around ₹70 lakhs annually against a portfolio growing at 18%, they highlight that even with high expenses, wealth can continue growing significantly.

Financial Independence and Wealth Growth

Understanding Portfolio Value and Withdrawals

The discussion begins with a calculation of portfolio value, estimating it at 60 crores based on a monthly withdrawal plan of 2 lakhs for 30 days, totaling 60 lakhs annually.

Emphasizes the concept of financial independence, highlighting that one can live luxuriously without depleting their wealth if managed correctly.

The Importance of Purpose in Work

The speaker reflects on being frugal not out of stinginess but sensibility, emphasizing the importance of hard work and purpose over mere retirement.

Expresses a mission to inspire young Indians, suggesting that having a purpose can drive continuous effort rather than seeking early retirement.

Compounding Wealth Over Time

Discusses how an initial investment of 100 crores could grow to 1,000 crores in 15 years through consistent compounding at rates around 15% to 20%.

Shares personal experience starting from zero to achieving a portfolio worth 60 crores in just 15 years by increasing systematic investment plans (SIPs).

Taxation as a Growth Strategy

Highlights the significance of paying taxes as part of financial growth strategy; suggests that avoiding taxes can hinder wealth accumulation.

Quotes Ramu Gamar on the mindset shift needed regarding tax payments: "pay every dime" to foster growth thinking.

The Power of Compounding vs. Asset Classes

Discusses how investing wisely and allowing money to compound over time yields better returns compared to hoarding cash or undervalued assets.

Reflecting on family tax contributions, emphasizes no regrets about paying taxes as it correlates with business success and growth mindset.

Strategies for Long-Term Financial Success

Mentions mutual funds as advantageous due to deferred taxation until selling; encourages long-term holding strategies similar to billionaires' practices.

Suggesting loans against investments instead of liquidating them for large purchases helps avoid immediate tax implications while maintaining asset growth.

Visualization of Compounding Effects

Illustrates the journey from zero to significant wealth within a defined period (0 to 60 crores in 15 years), stressing understanding compounding's power.

Introduces the Rule of 72 for estimating doubling time through compounding interest, reinforcing its practical application in personal finance planning.

Investment Strategies and Personal Insights

Compounding and SIP Contributions

The speaker discusses the potential growth of an investment corpus, illustrating how a starting amount of 60 crores could grow to 480 crores through compounding at 15% over time. They caution that achieving a consistent 15% return is challenging for most investors.

By increasing their Systematic Investment Plan (SIP) contributions by 10% annually, the speaker estimates adding another 480 crores over 15 years, leading to a total of approximately 920 crores from both existing investments and SIP contributions.

Lifestyle Choices Despite Wealth

The speaker shares their personal choice to travel by train instead of using luxury vehicles despite having a net worth of 60 crores, emphasizing simplicity over materialism.

They express that owning extravagant items like Rolls-Royce cars or private jets does not excite them anymore, indicating a shift in values as they have achieved financial success.

Investment Philosophy

The speaker identifies as an aggressive investor focused on mutual funds rather than direct stocks, believing that diversified portfolios mitigate risks significantly.

They highlight the importance of volatility in investing, stating that they welcome market downturns as opportunities to invest more when prices are low.

Portfolio Composition

Their portfolio consists of various categories: 30% in small-cap funds and another significant portion in sector-specific thematic funds, including a notable investment in China-focused funds.

The speaker emphasizes a buy-and-hold strategy while investing only during extreme market conditions—either very high or very low valuations—to ensure safety margins.

Market Analysis and Bubble Concerns

They discuss their reluctance to invest in gold and silver due to perceived bubble conditions, suggesting these assets have appreciated too much recently.

The conversation shifts towards small-cap investments which had poor performance last year; however, the speaker believes they were not yet in bubble territory despite being expensive.

Economic Narratives and Future Predictions

The speaker defines "bubble territory" concerning current asset valuations like gold and US tech stocks. They argue that while returns have been strong historically for the US economy, sustainability is questionable moving forward.

They acknowledge narratives surrounding US economic strength but remain skeptical about its long-term viability given historical patterns since the financial crisis of 2008.

Investment Insights and Sector Rotation Strategies

Understanding Market Dynamics

The speaker emphasizes a long-term perspective in investing, stating that they focus on price rather than stories, which can change rapidly.

Markets are characterized by cycles and volatility; understanding these traits is crucial for making informed investment decisions.

The current CAGR (Compound Annual Growth Rate) of the speaker's small-cap fund is around 17-18%, indicating strong performance but not at bubble levels.

Sector Performance Analysis

The speaker notes that while their small-cap investments have performed well, large companies like those in NASDAQ have shown lower growth rates over the past two decades.

A significant return of 56% CAGR from a PSU fund over four years prompted the speaker to sell and reinvest in banking funds, showcasing active portfolio management.

Current Sector Bets

The speaker discusses sector rotation strategies, focusing on buying into sectors perceived as undervalued or "cheap."

Currently, the speaker is optimistic about banking and IT sectors due to recent corrections in their valuations.

Rationale Behind Banking Investments

Banks primarily earn through lending; despite competition from FinTech firms, there remains a strong demand for credit in India.

A heat map analysis of sector rotations indicates financial services as a promising area for investment based on historical performance trends.

Investment Strategy Based on Cycles

The speaker highlights that they invest in sectors that are currently underperforming but show potential for recovery based on cyclical patterns.

Emphasizing a contrarian approach, the speaker focuses on quality investments that have lagged behind recently but may offer future growth opportunities.

Investment Strategies and Market Insights

Understanding Value in the Current Market

The speaker discusses the performance of global markets, particularly emphasizing that while the US market has done well, value investing seems counterintuitive as it typically involves finding undervalued stocks.

There is a debate on what constitutes "value," with definitions ranging from low-priced stocks to Warren Buffett's broader interpretation that anything bought below intrinsic value qualifies as value.

Quality stocks are highlighted as potentially valuable investments, especially those yielding 15% or more return on equity (ROE), which are rare in India.

Investment Focus Areas

The speaker identifies current investment focuses: financials, IT, quality stocks, and momentum. They note that momentum has not performed well recently.

A contrarian approach is suggested where the speaker plans to increase their systematic investment plan (SIP) annually and invest in underperforming sectors.

Dynamic Investment Strategy

The strategy includes both fixed SIP contributions and dynamic lump-sum investments based on market conditions; additional funds will be allocated if NAV falls by certain percentages.

The speaker emphasizes a structured approach to investing where they maintain a fixed SIP but adjust lump-sum investments dynamically based on market fluctuations.

Small Cap Fund Selection Process

When discussing small cap funds, the speaker argues that fund selection is less important than being in the right asset category; success depends more on overall sector calls rather than specific fund choices.

They share an example of successful small cap investments made in 2020 without focusing on individual fund performance metrics.

Criteria for Selecting Funds

The speaker reflects on their own experience with wealth accumulation through single-source income and questions why investors hesitate to invest significantly in large businesses despite past successes.

Key criteria for selecting funds include evaluating fund managers' experience (15–20 years recommended), avoiding reliance solely on recent performance metrics which can mislead retail investors.

Investment Strategies and Fund Management Insights

Understanding Fund Manager Selection

The speaker emphasizes the importance of selecting fund managers with at least 15 years of experience, especially those who have underperformed recently, as they may be poised for a turnaround.

A strategy is suggested to identify poorly performing funds over the last three to five years, indicating that investing in these can yield positive results in the long run.

Meeting with fund managers is crucial; understanding their philosophy and reasons for underperformance helps build trust and insight into potential recovery.

Analyzing Underperforming Funds

The speaker shares an example of a quality fund manager ranked 60th out of 60 in performance over five years, highlighting that sticking to a consistent investment style can lead to future gains despite current rankings.

The discussion includes insights on how certain categories like large-cap funds have not performed well compared to mid and small-cap funds, suggesting strategic shifts based on market conditions.

Evaluating Fund Managers' Commitment

It’s important for fund managers to invest their own money into the funds they manage. This aligns their interests with those of investors.

The speaker advocates for strict criteria where fund managers should ideally invest 100% of their salary into their managed funds, ensuring accountability.

Market Timing and Cash Reserves

Maintaining a cash reserve (dry powder) between 15% to 20% is recommended during volatile markets. This allows for opportunistic investments when prices drop significantly.

The speaker discusses using volatility as an opportunity rather than a risk, suggesting that keeping liquid assets ready can enhance investment strategies during downturns.

Strategic Deployment of Capital

A rule is proposed where if the market falls by certain percentages (e.g., 20%), investors should deploy cash reserves strategically rather than all at once.

Emphasizing disciplined investment practices, the speaker suggests that only after significant market corrections should one consider deploying capital from reserves effectively.

Investment Strategies and Market Insights

The Risks of Leveraging Debt

Discusses the potential risks associated with leveraging loans against property for investment, emphasizing that while debt can be beneficial, it is a double-edged sword.

Shares personal experience of attempting to take a loan during a market downturn but faced delays, highlighting the importance of timing in investments.

Market Corrections and Timing

Notes that taking loans at low-interest rates (8-9%) can be advantageous if one has regular cash flows to service the debt.

Reflects on historical market corrections, suggesting that significant downturns are rare but should be viewed as opportunities for investment.

Fund Selection Strategy

Stresses the importance of engaging with fund managers to understand their investment strategies and commitment over time.

Critiques common financial metrics used by advisors, advocating for a more nuanced understanding of long-term performance rather than just rolling returns.

Cash Management in Investing

Mentions Warren Buffett's strategy of holding 30% cash due to perceived market overvaluation, indicating a cautious approach amidst high valuations.

Shares personal experience of managing cash reserves (20% cash), acknowledging the challenge of resisting FOMO (Fear Of Missing Out).

Regret in Investment Decisions

Discusses how investing often leads to feelings of regret when observing others' successes or missed opportunities in various markets like crypto or gold.

Emphasizes staying within one's circle of competence and setting realistic expectations for returns (17-18% CAGR).

Client Communication and Accountability

Describes how he communicates with clients regarding high-risk investments, ensuring they understand accountability lies with them.

Highlights the cyclical nature of markets and his belief that all upward trends will eventually correct.

Portfolio Composition Insights

Break down portfolio allocation: 30% small cap, 40% large cap, 20% liquid funds; emphasizes diversification across sectors.

Discusses preferences between liquid funds versus arbitrage funds based on ease and efficiency in achieving returns.

Investment Strategies and Portfolio Management

Market Cap Allocation in Mutual Funds

Discussion on the allocation of 50% in mid and small-cap stocks within mutual funds, emphasizing that large caps are currently cheaper compared to mid and small caps.

The speaker mentions a strategy of potentially shifting investments from large caps to mid and small caps if they become significantly cheaper.

Active Portfolio Construction

The frequency of portfolio rebalancing is highlighted as being limited to one or two transactions per year.

Recent transactions include a lump sum investment of 1 crore in a China fund and an additional investment of 25-30 lakhs in a tech fund.

Systematic Investment Plans (SIPs)

SIP contributions are maintained across five different funds, with no frequent changes unless market conditions drastically shift.

The speaker indicates that they will only stop SIPs if one segment becomes overly inflated, suggesting a disciplined approach to investing.

Decision-Making Philosophy

Emphasis on the importance of not interrupting compounding unnecessarily; decisions should be made thoughtfully and infrequently.

The speaker reflects on their successful decision-making record, attributing it to taking fewer but more considered actions.

Market Analysis and Discipline

A focus on the Nifty 500 index rather than Nifty 50 for broader market insights; significant drops trigger potential buying opportunities.

The speaker shares their rule about waiting for a 20% drop before making substantial purchases, demonstrating discipline even when faced with market volatility.

Portfolio Overview

A disclaimer is provided regarding the sharing of personal portfolio details; individuals should tailor investments based on their risk appetite.

Introduction to the speaker's portfolio consisting of various funds acquired over six years, highlighting lessons learned from past investments.

Fund Selection Insights

Mentioned specific funds like Access Small Cap and HDFC Technology; reflections on learning from previous mistakes regarding fund selection.

Understanding Small Cap Funds and Portfolio Management

Overview of Small Cap Funds

Discussion on the quality of small cap funds, highlighting that fund managers have been underperforming over the last year.

The duration of holding these funds is noted to be around 1700 days, equating to approximately five years.

Performance Metrics

Emphasis on evaluating performance based on a longer time frame (365 days and above), with specific mention of a China fund achieving a 30% CAGR over 398 days.

A suggestion to reduce the number of funds from twelve to three or four for better management, indicating a focus on fewer investments.

Investment Strategy Insights

Mention of cautiousness in the auto sector after four years of good performance; advice against greed in investment decisions.

Importance placed on finding new contra bets when selling existing investments, emphasizing strategic portfolio adjustments.

Personal Portfolio Reflections

The speaker reflects on their personal portfolio's longevity, noting some holdings have been maintained for up to 5000 days (approximately 15 years).

Even the worst-performing fund in their portfolio yields a return higher than fixed deposits (FD), showcasing resilience in long-term equity investments.

Lessons Learned from Investing

Acknowledgment that staying invested in equities for an extended period can yield returns around 12%-13%, reinforcing the idea that long-term investing is generally safer than bonds or FDs.

The importance of assessing overall portfolio CAGR rather than individual fund returns; current family portfolio CAGR stands at an impressive 16%.

Final Thoughts and Advice

The speaker expresses gratitude for learning opportunities and emphasizes that personal finance should be tailored to individual risk appetites and financial goals.

A cautionary note against copying others' portfolios without considering personal circumstances; stresses that personal finance is more about individual needs than mere replication.

Financial Planning Insights

Importance of Financial Planning

The discussion emphasizes the significance of financial planning, particularly for individuals who are not wealthy. It highlights that substantial life expenses such as buying a house, car, and funding children's education require careful budgeting and foresight.

The speaker advises against pursuing financial strategies or advice if one does not have significant capital (e.g., 100 crores), suggesting that this content may not be relevant for everyone.

Engaging with the Audience

The host encourages viewers to provide honest feedback in the comments section, indicating a desire to improve future podcast episodes by addressing audience questions and concerns.

Viewers are invited to suggest potential guests for future episodes, fostering community engagement and ensuring that the content remains relevant to listeners' interests.

Sharing Knowledge

The speaker urges listeners to share insights gained from the episode with friends or family members who might benefit from them, promoting a culture of knowledge sharing regarding financial literacy.

If any thoughts sparked disagreement or new ideas during the episode, viewers are encouraged to comment on their perspectives. This feedback is seen as valuable for enhancing future discussions and improving content quality.