Best Advice I Ever Got: Motilal Oswal's Navin Agarwal

What was the problem you were grappling with? 
 

It was the first week of May 2000. The markets were reeling under the aftermath of the dot-com bubble burst and my equity portfolio had taken a solid knock in the meltdown.

Who did you approach? 
 

Raamdeo Agrawal (Chairman of Motilal Oswal Financial Services)

What was the best advice you have ever received? 
 

Agrawal had just returned after attending the Berkshire Hathaway annual meeting in Omaha. Following Warren Buffett, he was reconciled to the virtues of quality of business and the importance of return on equity as the first filter in the process of screening companies. Buffett says the goal is to find outstanding businesses at sensible prices, not mediocre ones at bargain prices, and Agrawal had imbibed the learnings. Besides, staying invested in the markets through the cycles and the perils of market timing were equally clear to him. No wonder, even in the midst of the meltdown, he was at peace. These learnings were encapsulated by him in a lifelong advice: “Buy right. Sit tight.”

How effective was it in resolving the problem? 

It was pretty effective. Not only did I implement it in my own investments, but also went on to build upon these principles in managing public money. I have learnt that the pre-requisites for successful equity investing are (i) a good investment philosophy—QGLP (quality, growth, longevity, at reasonable price) in our case; and (ii) a pig-headed determination in practising it.