'If I had Rs 100, I would invest in…': Zerodha’s Nikhil Kamath reveals his investment preference

NASDAQ and the Indian large cap equity market are Nikhil Kamath's favourite investment choices. In an exclusive interview with Business Today, the Zerodha founder said: “If I had Rs 100, I would invest in NASDAQ, Indian large cap equity market followed by the private companies.”

In Kamath's opinion, a lot of innovation happening in the world today is coming from NASDAQ-listed companies. “Private markets are more expensive and frothy as compared to public markets,” he said. He also said he would choose global markets over the Indian public ones for the same reason.  

Nikhil launched stock brokerage firm Zerodha along with his brother Nithin Kamath in 2009. The duo have invested in several start-ups through their investment and incubation entities - Rainmatter Climate and Rainmatter fintech.
Until a few years ago, raising capital attracted a lot of eyeballs. Valuation had become a buzzword of sorts.

However, the scenario is changing now. Zerodha is seen as a quintessential example of a profitable company which has been bootstrapped since the beginning.

Prod him if he was also tempted to raise money from external sources? “Definitely,” pat comes the reply. Kamath was tempted to raise capital in the initial years of starting Zerodha but the circumstances were different. “When we needed money, not many were offering it.”

However, when investors came to knock on the doors of the Kamath brothers, eight years had already passed and they had already built a profitable business which didn’t need external funding.  

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Kamath also highlighted that Zerodha has no plans to go public. “We don’t need [or] have an application for money if we raise it,” he states.

On the other hand, right now, he is focused on building his wealth management venture, TrueBeacon. The Bengaluru-based entity was started in 2019 by Kamath and former Vice Chairman of Standard Chartered Private Bank, Richard Pattle. 

The platform operates as an Alternative Investment Fund (AIF Category-III) and caters to only Ultra High Net Worth Individuals (UHNIs). It was started to make investment affordable, transparent, eliminate commissions of distributors, and change the way asset management takes place in the country. 

“People don’t realise but if you pay 3-4 per cent a year in accumulated fees (which includes setting up cost and the exit load), in 20-30 years if you compound that amount, it becomes bigger than the principal amount itself,” he shared.

The long-term goal is to make TrueBeacon a full-service wealth platform “without the leakage of a distributor”, he said.

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