VP CHINTAN BAITHAK GOA 2017 : Yogesh Sane : Investment Journey

As per request from @manish962, creating a new thread for my investment journey presentation I prepared for the 2017 Goa meet.

Investment journey- Yogesh Sane.pdf (644.7 KB)

Presentation Notes

Journey started when I went to US as a software engineer and was on bench during the dot.com bubble brust. I had plenty of time to do something that did not require a work visa and there were only two such things I could do, gambling and investing. I chose investing.

Read plenty of books but realized that such unstructured learning is incomplete so I enrolled in CFA course. Once I completed the CFA course, I started putting at that knowledge to work. After two bear markets and a lost decade for stocks in US, I learned a thing or two about valuation. So today my entire investing philosophy is centered around intrinsic value.

Along the way, I got a chance to work with several wall street firms and learned the institutional way of investing. Institutions manage most of the money in the world and there a good reason for that. They have a process that they strictly adhere to. Their systems are built around industry standard models and they rely less on individual skills ( as individuals often leave) and more on standardize models and systems. Although star managers often get the media coverage, it’s the systems and processes that actually enable an institution to grow and live in perpetuity.

My investment process is also inspired by what I saw at these institutions. That’s where the concepts of white list, valuation models, asset allocation models, financial statement analysis, checklists etc has come from.

Everyone at the meeting also had to present an incremental learning presentation to capture learning over the last 1 year. Here is my presentation.

Incremental Learning – Yogesh Sane.pdf (38.7 KB)

I hope you will like the presentation and I welcome your comments.


Created a new thread on a spreadsheet based valuation model.

Model presented in this thread is the central point around which my investment philosophy is built. It incorporates my learning from CFA course and watching how Wall Street firms operate.


Your journey is eloquently told; it resonates with my journey as well, except I started a little early in 1992.

One marked difference is that I focus lot more on macro picture and
recently started to look at micro information like con-calls, etc.

Thanks for sharing your story.

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Hi Yogesh,

Being in IT industry, I can co-relate with some of your observations.

Your sell strategy seems close to my sell strategy as well.
I focus more on Portfolio level returns (% CAGR) rather than getting carried away by multi bagger stocks. Since 2012, I have read lot of books on investing and VP forum articles and that has helped to build Allocation framework based on conviction.

My tenants of investing are close to Warren Buffet at the moment than other big and well known investors but with some fine tuning. My holding period is typically less than Buffet since I believe in booking profits once stock is overvalued and next 3-4 years returns are priced in as per my calculations. I like business with good ROE/ROCE, dividend yield, and available below Intrinsic value in case of some stocks, and businesses which are available at low PEG ratio in case of Growth stocks.

This model has worked so far reasonably well and I am not some one who looks for great returns but moderate returns with less risk as I would like to stay in this Investment journey for very long time. So protecting capital is of high importance to me, with 50% or more allocation to Large Caps and remaining to Small + Mid Caps.

Good to read your journey and articulation in presentation.


Hi @Yogesh_s i was going through your investment journey presentation and you have mentioned that you can reject an ideas within 2 minutes . it will be helpful if you clear some of my below query .
What is the first thing you see when you analysis a company ? What is the biggest reg flag to reject an ideas ? how do you analysis the company ,do you first go with the financial statement or with the company’s future prospect ?

Hi Yogesh,
What is your approach while selling the overvalued stocks, after receiving Bonus shares?
This is becoming very difficult decision for me, when after receiving bonus share, stock suddenly moves up so much that, from all angles it looks overvalued/extremely overvalued, and the main reason for holding is to avoid STCG, and hold for more time, and book LTCG later if it remains overvalued/extremely overvalued.
Now, since LTCG is 10% based on 31 Jan 2018 price, it involves some tax; but still it is less than flat 15% STCG tax, so the dilemma continues.
If you have any process for this, it would be great to know, from your learnings and approach.

I do not pay much attention to bonus and taxes while making a sell decision. If something looks overvalued then sell it. Don’t wait for it to turn long term. If you do the math, generally your break even % is less than 5%. i.e. if you sell a stock now and pay STCG vs if you hold a little longer and then pay LTCG, the difference is less than 5% of the value of the stock. In other words, selling now and paying a higher tax is better than holding on and selling later if stock is expected to drop between now and when it turn long term for you by this break even % which is usually less than 5%. Since this number is so small, it does not make sense to hold on to an expensive stock just to wait for it to turn long term.

Such cases happen when stock has rallied a lot in a year and it has strong upward momentum and fear of missing out is driving you hold it. LTCG is often just a reason we invent to hold on to such stock when in fact pure greed is the main reason.


Does this apply to far-stretched FMCG stars defying gravity for years?

Thanks Yogesh for your clarity of thought.
I have been sticking to principle of selling such cases, and pay STCG taxes, but recently came across few investors who hold for another one year, and pay zero tax (till last year), or 10% LTCG Tax (after considering 31 Jan 2018 grand fathered price) and this has added to the dilemma.
Anyways, your answer helps.