Kenneth Andrade Shares A Trend @KotakSecurities #KotakMidCapMeet15

wealthymattersKenneth Andrade holds that India is transiting from a high to low interest rate economy.

This confirms my belief since late 2007.

This interests all those of us on a long term, multi-decadal/ multi-generational wealth-building journey.

We need to focus on locking in prevailing higher rates on fixed income instruments for as long as possible. Or construct such instruments for ourselves.

There will be spikes in interest rates in future, but at the end of each cycle, interest rates will keep trending lower.

A Kenneth Andrade Tip @KotakSecurities #KotakMidCapMeet15

wealthymattersKenneth Andrade has a hunch that the banking cycle recovery will be prolonged this time, compared to the previous two cycles.

This is significant to all the fixed income investors following wealthymatters. Don’t lend your money cheaply. And don’t gamble on yields with wrong expectations.

Kenneth Andrade On Investing In Infrastructure @KotakSecurities #KotakMidCapMeet15

wealthymattersKenneth makes no bones about stating that Indian Infrastructure is really over-invested in. There is really not much money to be made by an equity investor in this space.

India has much infrastructure, but its of poor quality. Eg we have the highest density of roads in the world, but of poor quality.

Most of our ports have 60-80% capacity utilization.

The power sector in India is different from anywhere else in the world, due to the high consumption of power in the agriculture sector. (Insert free power and read between the lines.)

The real area to invest and grow wealth is in infrastructure maintenance.

Where Is The Next Big Thing? Kenneth Andrade @KotakSecurities #KotakMidCapMeet15

wealthymattersSo interested in becoming the person to build the next industry dominating Large Cap Company?

Kenneth Andrade has an insight for you.

Locate a currently unorganized sector of the economy, better still locate a business that is not yet even an industry. Start small, build a brand and then grow steadily, consolidate and then dominate the sector.

PS the insight also works for investors, VCs etc who’d like to early on identify and back the next big thing.

Focus On No Debt,Kenneth Andrade @KotakSecurities #KotakMidCapMeet15

wealthymattersIf there is just any one tip Mr Kenneth Andrade would give a person investing in small -caps, its focus on small companies with no debt. This increases their chances of surviving the next 10 years.

He follows companies to ensure that over time the sum total of their equity, reserves and debt goes down, to ensure that these businesses are using capital efficiently and returning profits to investors. Equity investment according to him is about withdrawing money from the business.

And to Bhavikk Shah’s question, he says to focus on ensuring that the companies have no debt. Then there is no chance of them flaming out.

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