Hitesh Patel: Our Simple, Uncluttered, No-nonsense Mentor

Gujarati doctor turns value investor after reading Buffett, Lynch; makes a killing

Patel claims to have generated up to 45 times return on select stocks over the past few years.

Rahul Oberoi, ETMarkets.com
Last Updated: Jan 02, 2018, 07.20 PM IST

Medicine and value investing are at best strange bed fellows. But this Baroda-based doctor can prove you wrong.

A dermatologist by profession, Dr Hitesh Patel (50) is as fluent with Peter Lynch as he is with his scalpels and forceps.

He loves to be called a value investor and has a claim to this label after having managed to spot quite a few stocks at their early stages of growth.

Patel claims to have generated up to 45 times return on select stocks over the past few years.

Hitesh is an astute investor among the value-investing community in India, says Donald Francis, a value investor, and founder of ValuePickr.com.

“He has remained my main sounding board before major investment decisions since 2010 when we first met. I was much impressed with his clarity of thought and ability to cut through the clutter and simplify things for us,” says Francis.

Patel loves interacting with “like-minded investors,” who he says can change your thought process. He is also an avid reader and follows Peter Lynch and global investment guru Warren Buffett religiously.

“They have played a crucial role in moulding my investing journey from ordinary to extraordinary,” claims Patel.

Patel has a knack for spotting midcap and smallcap stocks with outstanding growth potential at their infancy.

He says pharma multibagger Ajanta Pharma was part of his portfolio from 2010 to 2015 and it gave him 45 times, or 4,500 per cent, return during that period.

Among other big gainers, Kaveri Seed Company gave him five-times return between 2012 and 2014; VST Tillers swelled four times during 2013-14, PI Industries climbed six times between 2013 and 2015 and CanFin Homes multiplied his wealth by over 12 times between 2013 and 2016.

He is not holding these stocks at present.

ETMarkets.com could not independently verify Patel’s holdings at present or back then.

Two other stocks Patel had in his portfolio – Bajaj Finance and DCM Shriram – surged over 200 per cent and 60 per cent, respectively, in last two years. He still holds them.

Patel is very knowledgeable on smallcap and midcap businesses in India and dedicates a lot of time handholding and mentoring young investors, says Francis of valuepickr.com.

He was one of the most loved and admired personality on the website’s forum with over 22,000 registered members.

By birth a Gujarati, a community that can possibly claim the largest population in India’s financial markets, Patel says Peter Lynch’s classic One up On Wall Street turned him into a serious investor way back in 2008.

He also mentioned Buffett’s biography The Snowball, for making him believe that it is possible to create enormous wealth through focused investing.

Patel says he follows a bottom-up approach to pick quality names from the universe of India’s more than 5,000 listed companies.

“I try to look at the business quality, valuation, management quality, balance sheet, opportunity versus size and enterprise value of a business and then start working on it,” he said.

Patel has a good knowledge of technical analysis, which he often uses to identify the right entry point in a particular stock.

“Once a company passes my fundamental filters, I look at the charts and apply my basic knowledge of technical analysis to discover good entry points. Sometimes, chart patterns lead to good companies, which have got great potential in terms of fundamentals. Combining fundamental analysis with technical analysis has worked very well for me,” he says.

Hitesh Patel did have his share of failure and burn his fingers on stocks like Unity Infraprojects and Renuka Sugars, which delivered negative return for long.

“I bought Unity and Renuka on hopes of turnaround, which did not happen. One dictum I follow strictly is to get rid of losers as early as possible, irrespective of the percentage loss. That helps restrict losses and maintain focus,” says Patel.

And like every other investor, haste to book profits on the bets where he got it right has been Patel’s biggest regret.

“Exiting potential winners with early harvest, without waiting to fully reap the benefits has been the biggest mistake of my life,” he says candidly.

Patel has a piece of advice for new equity investors: Make sure you know why you are investing in a particular company. You should be able a write up of 1-2 pages explaining your their investment thesis before picking a stock, says he.

He says people with interest in the market should try and refine their investing skills constantly, and that would eventually help them achieve big success in the market. Having a sound temperament is of paramount importance for success in stock investing, he says.

“I started investing in stocks without much knowledge and lost a lot of money between 2003 and 2008,” Patel confesses.

“But after reading some investment books and coming in contact with like-minded investors on various platforms, I developed the confidence to go full throttle into stock investing,” he said.

Patel keenly follows value investors such Donald Francis and his peers back home such as Ayush Mittal, Abhishek Basumallick, Anant Jain, Dhwanil Desai and Nirav Parikh.

However, he makes it a point to stick to his investing style and refused to clone others blindly.

With the domestic equity indices ruling at lifetime highs, Patel is currently focusing on quality midcaps in software and commodity space and is looking for turnaround stories.

Patel looks content with what he has achieved thus far: It has been a rewarding journey in terms of the love and respect of fellow investors and the financial returns, says he.

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Guys/Gals,

As we embark on a tough new decade, it’s time for us to turn the spotlight on the last decade, celebrate the success of our most prominent ValuePickrs, get inspired, and rededicate ourselves to the VP Ethos - Democratic, Accountable, Actionable Advice!!

Let’s shower our gratitude on (probably) the sharpest mind at VP :slight_smile: someone who embodies all above in its truest form, and has been/is VP’s biggest Ambassador. Hitesh has been instrumental in personally (almost single-handedly) handholding and mentoring a huge huge number ValuePickrs.

We all owe a huge debt of gratitude to Hitesh - his brilliant, uncluttered mind which he shares so generously with each one of us; More so, when some of us TopContributors have sometimes been guilty of slacking/being off VP for months, but never Hitesh.

It’s no exaggeration when my well-meaning senior investor friends (in the larger investment community) tell me Donald, VP has been riding on Hitesh’s shoulders for last 2 years almost; Time for rest of you to step up!

Some of us are trying to; Others will step up soon too Hitesh (@hitesh2710). Thanks for your diligence, patience, and the big heart! VP owes you many!! Wishing you many more runaway Hits, much more media coverage that you richly deserve.

May you continue to inspire everyone at VP, and the larger Investment Community in India!

PS: Guys/Gals - as a mark of respect for HItesh, DO NOT like up this post or the previous one. Wait for some words from Hitesh - that will be the time for us to celebrate his success, shower the community’s love and blessings, and wish him all the success in all his endeavours.

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Log pura padhte nahi…pehle thoko… Like. Please wait for some wise words from Hitesh…phir usme jitna chahe …hit as much as you like :wink:

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Donald, peronsally I owe you a lot.
First for providing platform.
Second to motivate to participate with transparency and rationally.
Third and last but not least, allowing to connect with great Persons and good investing minds.

While all in VP group forum, with whom interacted though forum or in person are excellent persons with good intent. Intelligence without right intent could be disastrous in all relationship. But, Hiteshbhai is one individual all of us love. I am blessed to be showered with his personal affections at various occasions.

I am one of few privileged to seen him in practice for short time. He needs 30 seconds and 3 questions to diagnose the disease. Balance 4-5 minutes are taken by patience to describe his/her conditions and other issues . Rarely seen mind which absorb what is critical and reject what is not meaningful.

In spiritual world, there is concept of Hansa (Swan) which is consider as supreme soul who can differentiate between Nir (water) and Kshir (milk) and drink only Kshir. Hiteshbhai is VP forum’s Hansa.

If Hiteshbhai like this post, next time as a reward like to listen Mukadar ka Sikandar song “Salame e ishq” song para which is sang by Amitabh in movie. One must listen to appreciate what superior singer he is. Even if he dislike my post, I am sure I would earn my reward. Once Bollywood song of 70-80s start, within 15 minutes this song would come from
Armour of Hiteshbhai. Eagerly awaiting to meet next time Hiteshbhai to claim my reward.

Thanks Donal to take initiate (and hence the like) and Our “Hansa” Hiteshbhai to provide his insights on various topics.

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Let us limit this thread to appreciation of our dear mentor Hitesh. Make sure it does not turn out to be a devotional one. I know Hitesh(being my friend) may not like any demi god like comments. He is a mere mortal like us & he would love to remain the same.

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Hi friends,

First of all congratulations to team VP on completing a milestone in a joyous journey. It has been a great platform to share and learn and helped many an investor hone his skill and mature in their journey as investors. (and for a vast majority to attain financial freedom which is a big lifetime achievement)

Next I want to acknowledge that I am not a complete investor or nowhere near to it. I have my weak spots and blind spots and biases and am humbled by markets time and again. So let this thread not be about hero worship. I even get uncomfortable when people address me as Sir or add jee/ji behind my name.

Speaking about myself, my journey started after reading Peter Lynch’s One Up on Wall Street and that was the Eureka moment for me in my investment journey… That was somewhere in 2008-09 and post that somewhere in 2010, Donald made it a point to contact me and visit me at my home in Baroda and it was instant friendship on both sides. Being on valuepickr took it to next level.

The biggest benefit VP provided me was refinement in my thinking process, especially after interacting with other guys with different investment styles. And having met these successful investors, I developed a strong belief that there is no single holy grail. There is a place for different investment styles in the market provided they are followed diligently. And provided one identifies what suits us. I personally am much more comfortable in combining technicals with fundamentals. I am not too much into the deep dive style of investment which Donald does. Nor do I have the width of knowledge which someone like Ayush is blessed with. Or the kind of deep thinking and analytical skills that Dhwanil or Abhishek bring to the table. But I am okay with my own style and my constant endeavour is to try to improve upon myself and create a better version of myself which is more helpful to others and generates better returns for me.

The other big benefit I derived out of my constant interaction on VP was that I have a huge circle of friends from among VPers and by extension from the other investment communities with whom I have a strong circle of trust. I can ask any of them about company/companies they are tracking and I can be fairly confident that they will share whatever they know about the company without an iota of mal-intent. Its difficult to imagine such a huge network of friends with whom one can interact and even meet whenever I go to their cities.

About my participation on valuepickr and the handholding role I am supposed to play for newbie investors, I am a strong believer in the circle of virtue. “As you sow so shall you reap.” Only 7 words in the sentence but an everlasting message.

PARTICIPATION AT VALUEPICKR -

Ever since I joined valuepickr, I have received tremendous help and love from the community and I feel duty bound to give back to the community to the best of my ability and hence my contribution. And I feel that should apply to other top contributors too. One should not feel that he/she is doing a favour to others by writing at VP. Participation at VP should bring about a sense of belonging and should be a matter of immense pride and satisfaction . Besides, it brings about clarity about stuff in our minds once we tend to write down things.

We have had our annual VP conference where we decide on participants by recognising their participation to the forum for the benefit of others. This can be in any form , like the policeman at our forum - @manish962 who reads innumerable threads almost on a daily basis to weed out unwanted or undesirable content/thread. Its a thankless job but someone has to do it and he has set an example. Similarly there are the guys who help in maintaining the platform like @pratyushmittal and his other team members who keep maintain this wonderful platform. I would urge any other VP member to find his/her own niche wherein they can be helpful/indispensable to the forum.

Besides investment and my chosen profession which is dermatology, I have a wide array of hobbies/interests which keeps me happily occupied all throughout the day and helps me be keen to look forward to the next day. I love reading fiction, watching movies, (web series now amidst lockdown), am a keen follower of sports like cricket/football (big Messi fan)/tennis/athletics etc . As @dd1474 mentioned, I am very fond of Hindi film/non film music and can shake out a lot of people in antakshari. :muscle:

ANNUAL VP MEET

The valuepickr meets are always a lot of fun and I would encourage everyone to contribute meaningfully to get a ticket to the high table and enjoy not only the knowledge shared at the conference but also enjoy the camraderie that goes on all throughout the sessions and rest of the times. Last year we had our Antakshari sessions/volleyball matches/beach walks besides the brainstorming we did. As said before we are putting forth a system of evaluating top contributors not only by the likes they receive but by the quality of their posts and the actionable stuff from within it. The existing top contributors also need to shake out their inertia and roll their sleeves and get cracking. The kind of stuff they can share on the broader platform is beyond belief. I hope I am instrumental in providing the nudge to stimulate them.

A big thank you to all the very close friends on VP who I call off and on to discuss stocks/strategies frequently for their time and views. (there are so many in the latter group and hence not possible to name them but they know who I am talking about) You all have been my teachers/guides/friends in my journey.

FINALLY A BIG THANKS TO VALUEPICKR FORUM PARTICIPANTS FOR THE IMMENSE LOVE AND RESPECT THEY HAVE SHOWERED ON ME ALL THROUGHOUT THESE YEARS.

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I have interacted with a lot of investors & traders in the last 20 years but I am yet to meet someone who is as good as Hitesh Bhai as a package deal. He is firstly a superb human being, and has an uncanny knack of understanding the markets and nuances of a company better than anyone else I know.

We started interacting from the TED days, where his thread was also one of the most popular ones. But personal interaction was not much there. Maybe once or twice on the phone. That changed when we first met in Goa. I still remember Hitesh bhai telling me on the end of the first day in the first year, that I am not like the person I sound on the forum (he thought I seemed very serious from my writings, whereas I love to joke around and generally have a good time!!!).

During the VP meets in Goa, we started going on the beach walks in the morning, and since both of us are early risers, most of the time we ended by going for the walks by ourselves.

I started understanding the beauty of technical analysis from him and also got a glimpse of his razor sharp mind first hand. His ability to cut the BS and get to the meat of any argument is just phenomenal. When I asked him about it, he said maybe it came from years of his medical practice of diagnosing patients in a very short period of time.

The only problem I see with his investing is that sometimes he is too quick in and out of a stock. By the time I can study a stock, he would have bought and sometimes sold also!!!

The amount of time he spends in answering all sorts of questions from forum members on his thread is just extraordinary.

He has been like a mentor, friend, elder brother to me for the last few years. And I can never repay the amount of things I have learnt from him. And I have probably never said thank you to him.

So, here is my chance. Thank You @hitesh2710 :pray:. You are the best I know.

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I know Hitesh since last 25 years. He is a close friend, guide & mentor. As Abhishek mentioned, he is a very good human being. Our investment interactions started in 2009. Since then I have seen his investing knowledge growing into investing wisdom. His clarity of thoughts are unmatched. He can separate average business easily & quickly. Best part of him is that he knows where to work hard & what to ignore.

His helping hand to novice vp members has made him the most respected & loved member of VP family.

We have spent best moments at his farm where he would prepare tea for us. Plucking & eating fruits/vegetables at his farm will be cherished forever. I feel lucky to have spent more time with him than any of VP members & for that I am enviable.

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Thanks Hitesh bhai. This summarizes the theme- for those who doesn’t know him personally. For us who doesn’t have analytical minds, he is a God send mentor.

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"We shape our buildings; thereafter they shape us." - Winston Churchill

Please note that the quote starts and ends with We and Us respectively. In my view this is the real beauty of his quote.

Churchill’s quote is apt for what @hitesh2710 bhai has done for our VP community. Below is how I interpret it by breaking down the quote in two parts:

"We shape our buildings;" - Hiteshbhai (and others) have shaped the ‘VP building’ mainly by laying a strong foundation that is supporting the ‘VP building’ from underneath. His each and every shape; i.e. each and every post, shows his selfless devotion to sharing his wisdom candidly with all of us, making ‘VP building’ taller and stronger all the time by giving back to the VP community.

"thereafter they shape us." - I’ve evolved so much as an investor in last few years and big contribution of that evolvement has come by learning from Hiteshbhai’s posts. I’m sure there are numerous of us, VP community members, who would completely agree with me. And as Hiteshbhai said in his above post that the biggest benefit VP provided him was refinement in his thinking process, especially after interacting with other VP’ers with different styles. So “WE” all have been thereafter shaped by our ‘VP building’.

Hitesbhai - thank you for your contribution to shaping the ‘VP building’, and in-turn shaping many of us!

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Sir, it was you who introduced me to Hitesh sir. Thank you so much.

Hitesh sir’s participation in Valuepickr and his contribution in mentoring investors like me, is unparalleled. Sir, you are the biggest contributor to me being a full time investor. Thank you for all the knowledge you share in each of our interactions without holding back anything.

Also, you are a great family friend to have. Your spiced evening teas, visit to your farm, our telephonic conversations, exchange of emails and our endless chats during your visits to Mumbai are priceless. Cheers to many more of them in the times to come.

Thank you sir for being who you are for me and many like me :pray:

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Hiteshbhai has been a great mentor and shaped up the investing journey of many of the newbies including me. His portfolio thread has a lot of nuggets of wisdom. He has all the patience in the world to reply to each and every question posted in the thread. In fact, he has been the most regular and consistent contributors to the VP forum. I still remember that I and Ravjeet met him and @manish962 in 2013 at Vadodara and he was kind enough to share his knowledge with us. We met again at Symphony’s AGM at Ahmedabad in 2014. I being a novice used to think 16 - 17 times P/E multiples for a branded business generating tonnes of free cash flow was expensive :slight_smile: but he taught me about the power of brands along with multiples companies generating free cash flows can command.
I think what differentiates him from others is the kind of simplicity he brings to investing. Also, his ability to grasp key variables in a business in short time frame is something not many are able to do (I would take weeks to reach a conclusion about a business which he would hardly reach in a matter of days of reading about them). He has been generator of ideas for many multibaggers in VP including Mayur, Ajanta, Canfin, Astral etc. Many of these ideas were identified when they were not in limelight and had pretty small market capitalization. Many of these businesses were under transformation (eg change in management in case of Canfin, second generation driving growth in case of Ajanta) and he was quick to latch onto them.

He has become a good friend and the moments spent at his farm are something I eagerly wait for.

Thank you Hitesh Bhai for being a guiding light to many VPers.

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Although I have interacted only electronically with Hitesh Bhai, Simplicity and Humility are the two qualities that are always evident in his communications. His style of communication filters all the noise and makes an amateur understand the real signal.

I wish him all the best for the future.

P.S: After hearing from all champion ValuePickrs, I look forward to the privilege of seeing him in person.

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A heartfelt thank you Hitesh bhai. Haven’t interacted with you much. But have been a keen reader of everything you write on VP. Thanks again.

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Thank you to Hitesh Patel for the continued guidance he has provided on this forum. I have been silently following him for a long time and have learnt and benefited a lot from his posts.

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God bless u Hitesh bhai for everything we appreciate u !!

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Hitesh Sir Namaste,

I would like to applaud and be thankful to you for all your work and wisdom shared in this platform.

I started investing on 2016 blindly without noticing or understanding, but thankfully to your knowledge & wisdom share - am able to make a lot of sense with this unconditioned markets. No one would like to share or do the kinda work that you are doing by self learning and sharing. Sir you are a great person with humble and soft heart listening to everyone and responding all queries.

Am glad to have met such a guru in my life. Thanks to you and your hard work - that we are in a process of learning everyday from you.

Thank you @hitesh2710
Your’s sincere student :slight_smile:

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Completely agree . He has always answered patiently so many of our basic queries and shares insights not found in any book . And best is is he has shortened our learning curve else we would have made a lot of mistakes . He has helped us in vicarious learning (what charlie munger says) from his own experiences so that we dont burn our hands . Thanks a lot Hitesh bhai for handholding us through tough times too and especially patiently answering queries during these tough times :pray:

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@hitesh2710 Sir - am amazed with your range of knowledge, insights as well as humility. Your passion for your profession as well as for the stock market is legendary. And your readiness to help other investors without any selfish motive is really something to adore.

May God bless you and give you more strength to enlighten the world with your love and affection.

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Hiteshbhai is star of valuepickr. Many people come to valuepickr just to read Hiteshbhai. He has super capability to express. Someone says if you understand better, you can express in easy language. One example of his superb expression today is “Difference between daily and weekly chart”.

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