Seven Intelligent Fanatics from India

Yesterday, I delivered a talk titled “Seven Intelligent Fanatics from India” at Value Investing Seminar, Trani, Italy.

None of the stocks of companies run by any of these seven entrepreneurs were recommended for purchase. Nor am I recommending them now.

I know that some of you may disagree with me about the conclusions about some (or even all) of the individuals profiled by me in my talk. However, I do not wish to get into a public debate on the subject. Think of what I said as my own personal views please.

Why did I choose these seven or only seven? Well, I had only 20 minutes to deliver this talk (I actually took 21). And I chose the ones I was more familiar with. To be sure, there are many more intelligent fanatics out there.

The reason I am publishing this is to help investors understand that: (1) an intelligent fanatic has the ability to turn what looks like a poor business into a very good one; and (2) the force (I call it “fire in the belly”)” of an intelligent fanatic, when combined with a good business, has a tendency to produce what Charlie Munger calls a “lollapalooza” outcome.

You can get the transcript of the talk from here.

55 thoughts on “Seven Intelligent Fanatics from India

  1. Muthu says:

    Wonderful presentation of thoughts. Thanks for sharing. Reading your recent interviews and presentations shows the journey of your evolution as a moat investor. Most of these companies are mid or small caps. In 2013, when you wrote blogs about quality, you shared large cap names as Nestle and Asian Paints as examples. Any specific reason you prefer only midcap names now? Is it because their growth rates would be much faster? Can an investor look for moat in well established large cap names? Would these companies also not grow as there are abundant opportunities in India? We are still at a low base. If possible, please share your thoughts.

    • vsarda says:

      Sir, building on Muthu’s question, I am very interested to know your views on the recent Maggi fiasco and its medium and long term impact on Nestle. No doubt Nestle will come out of it, but we surely are looking at 2-3 quarters of pain due to lack of sale of Maggi noodles, cost of recall, cost of destruction, cost of brand building again (promotion, advertising), hurt on Goodwill etc. Shouldn’t this mean that Nestle should be available at much cheaper rates ? And would that make and interesting investment case? The Maggi case makes me wonder if any “moat” can be breached and that too from unexpected quarters.

  2. and I tell you the ninth Intelligent Fanatics who has equal Integrity, Energy and Intelligence of all 8 put together. He is Sanjay Bakshi and he is turning gullible investors into intelligent investors. Keep it up prif!!!

  3. Its truely what I need to learn to be like you Sir… Motivating…

  4. Alok K Sahi says:

    Thats a fantastic line up of people and these are the same people about whom you have written before . They are all outlliers having a huge market to expand to. The new concept rural vehicle from Mr Lals stable could be a game changer for the Farmers family . I am not so sure about Kewal Kiran coming from a small town myself . Thank you for this post .

  5. awesome sir. this is the best lesson a person can get about life and investment.

  6. BG Srinivas says:

    just awesome .Thank you very much for sharing ,sir

  7. Our PM’s going to love you!🙂

  8. shankaryes says:

    Thank you, for being the ‘ Prof’ to all of us ‘ not so intelligent ‘ investors !!

  9. Another Gem from ‘Profsville’.

  10. Krishnaraj V says:

    Thank you for sharing. Not sure about the 8th though.

  11. Can Sunil Agarwal of vaibhav global be considered as an intelligent fanatic?

  12. Excellent thought process. One thing I learnt from you is to try to find out common attributes or common pattern in any field (Business, Businessman, investment and investors)………………….

  13. jaithecloner says:

    Professor – Understand this is not exhaustive list… Would you think TCS (from 2008), infy since becoming public or Shriram transport would have a place in this list too…

  14. jaithecloner says:

    Thanks for the excellent article and making people think about moat investment… I like picking the moat investors (good mutual funds)…

  15. Really good article..I am not your regular (investor/finance) student. But a struggling entrepreneur. These articles really help me in staying focused. Thanks again..

  16. vijay nikam says:

    Many thanks…..

  17. Satish V says:

    Excellent Article !!!

  18. duliiptmehta says:

    Good read for value investors

  19. pal dharam says:

    Print,read and chew it,

    Thank you Sir

  20. Pratik Lalka says:

    Thankyou Sir, This has been one of the most intellectual Article i have read in my life.
    You are much more than a CM & WB of the Great India. Thanks for enlightening investors with this great Fact.

  21. What should everyone get from the last Intelligent Fanatics is that Invest in India Or Buy India….!!!!!!!!!!!

  22. Joseph Joy says:

    Fantastic article , great stuff.

  23. Bakul Lalla says:

    Hi Prof,

    Thank you for a wonderful presentation regarding Intelligent Fanatics. If/when you cross paths with Achal Bakeri, give him my sincerest of regards. During grad school in USC, he was in the MBA batch while I was in the engineering batch. My roommates were from India and they used to meet Achal every so often either in between classes or weekends. I am so proud of him as well as all the other Intelligent Fanatics. As I read through your examples of these extraordinary men, I remembered reading about Henry Singleton.

    Thanks again,
    Bakul Lalla

  24. Hersh Tolani says:

    Not your best article Sir

    Whatever happened to buying a great business that even an idiot can run. And though I know your intellectual honesty the article smacks of hindsight bias

  25. Aniket Gore says:

    Wonderful Writeup Prof. Bakshi. Thank you!

  26. biggnitin says:

    Greatly inspiring reading. I wish we had a video clipping of the audience reaction when you were done. And love your little twist in the end with Modi. Thanks for sharing and advertising Indian Intellect.

  27. Hi Prof

    Did you observe any other personality traits?

    ruthlessness, tenacity, listening skills, articulation, Comfort with numbers, Time management, etc

    I am trying to factor out ‘luck’ from the equation.


  28. ankur lakhia says:


    Thank you for this article. I would like to take this opportunity to know your views on something which intrigues me about Kitex Garment Ltd. Promoters have other companies which appear to be in same line of business, Kitex Childrenswear Ltd and Kitex Limited. These two companies also have interparty transactions with listed entity. I have tried but failed to understand how these relations are kept independent and why promoters like to keep them separate entities. Also, promoters of listed entity have pledged some of their shares. It is not related directly to business prospects etc. However, it would be very helpful if you provide your views on this matter. Thank you as always….

  29. shyam10885 says:

    Modiji has all the qualities…
    Integrity is questionable.
    Like what warren buffet said its dangerous to have a intelligent person who is acts fast but is not honest.

    Wonderful article professor.

  30. fantastic research and lucidly written. i hope we allow the last one to work

  31. Thanks for sharing Prof. The investing world is truly a better place because of you.🙂

  32. Beautiful article sir, many thanks for sharing!

  33. Thank you for this article….

  34. samsjn says:

    Reblogged this on samsjn.

  35. Really very much appreciated article.

  36. Likes of warren buffett, bill gates, azim premzi donating billions of dollars for benefit of less privileged. Do you know you are doing exactly the same for people like me by sharing your years of efforts imparting us this wisdom. And I am not even a bit exaggerating sir. One request- Please continue doing this social service.

  37. Simply great. We must learn to have patience and give time to manage this large, complex and diverse country like India. Should we call ourselves fortunate to have NaMo as our PM. For the first time in independent India’s history, there is somebody who is thinking about India first and then any thing else. Look at what Jawaharlal Nehru did to India. It was his mishandling of Kashmir issue (right immediately after partition) that we are still paying price for it in the form of Pakistan who lays claim on it. Look at what Indira Gandhi did. Right after having the largest and biggest army surrender in the recorded world history as of date, she failed to pressurize and/or persuade Pakistan to leave some of the so called disputed territory of India. MaMo never looked after SoGa.
    It is high time that we stop our myopic attitude on India’s future. We have a great future under the PM ship of NaMo.

  38. Hi Professor,

    Can you share the list of other business men as well . Will be a very good read.

    Krishna Prasath

  39. Vora Rajesh says:

    Dear Prof Bakshi, Thanks for sharing this outstanding presentation! In just 21-minutes, you’ve provided us with the crux of value investing. I’m floored by your humility to accept that it took you 15 years to come to this moat-based valued investing style that is championed by Warren Buffett. After I met you at your Delhi office on 3/8/09, I’ve been reading almost everything that you write/present and have immensely benefited from it. A big thank you for the same. I would like to meet you once again in Delhi at your convenience. Please let me know when it works for you. Thanks and all the very best.  Regards,Rajesh Vora9821223804. 

  40. […] fanatics. Sanjay Bakshi (a must follow ‪@Sanjay__Bakshi‪) wrote this excellent piece on Intelligent Fanatics. Intelligent fanatics are those CEO’s that have intense focus, integrity, energy, and […]

  41. […] Woke up with a sudden and loud music of my phone,(ringtone of ACE ventura’s favorite dialogue, ‘ALL Righitie Then’) and while i was still rubbing my eyes, my over zealous value investor friend on the other side urged me to open my computer and check professor’s latest BLOG […]

  42. Hi Sanjay, I recently had the good fortune of reading your article. It is well-written and contained sound, practical advice. Thank you.

    I would also like share a concern on some statements of Mr. Sandeep Engineer. In an ET Now interview on Aug 29, 2014, he mentions there are no acquisitions plans and for your immediate reference, i produce the relevant excerpts here –

    ET Now: Any other acquisition plan?

    Sandeep Engineer: Not at present.

    ET Now: So not over the next six months?

    Sandeep Engineer: Not over the six months or not over the one year.

    ET Now: But are you in active talks to acquire something right now or not?

    Sandeep Engineer: No, we are not in active talks.

    About 2 and half months later, however, Astral acquires 76 per cent equity stake in Kanpur-based specialty chemicals manufacturer Resinova Chemie Ltd for Rs 212.8 crore.

    Evidently in this interview itself, the journalist has a sense of impending acquisition and yet Mr. Sandeep dismisses it. I don’t think he has adhered to high moral principles in this regard.

    Paresh Sangani

  43. a18ps says:

    Hello Sir:

    This is in reply to Manish’s post on MysticWealth. Riveting read which triggered some thoughts captured below:

    1. Do all people with integrity, intelligence, and energy go on to create great companies? Definitely not as large doses of luck are required as well. Recent article about founders of TaxiForSure would highlight this aspect.

    2. Are dishonest people always doomed for failure? Not in all fields; in fact in some fields they have probability of success stacked in their favour.

    I believe you had written this article about investment in companies listed in public markets. That being the case, and considering that most of the investors will have no control and will largely remain passive, which scenario is desirable

    1. Partner with people who have large doses of integrity, intelligence, and energy

    2. Partner with people who do not have such qualities; however, may not be crooks necessarily.

    I think the answer is obvious if one is a long term investor looking to partner with able and trustworthy people for decades for compounding gains. However if one is looking to flip with 30%-40% gain, then all bets are off the table and this argument might not hold. I am not being judgemental and there is nothing wrong with the second option; however, I think it is terribly important to know which camp you belong to and what are your expectations.

    Of all the three qualities, I think integrity is the most important. We will be faced with so many choices where if we don’t have rock solid values, it will be difficult to do the right thing. I wonder what could have prompted Mr. Siddhartha Lal to offer same opportunity to minority shareholders apart from his internal scorecard and do something which is right to do without any compulsion. If Ramesh Dua had not transferred Relaxo brand to the company, I wonder if minority shareholders would have reaped such benefits. Both Ramesh and Siddhartha could have failed and we would have never heard about them; however, by partnering with such people we are at least exposed to huge gains if they succeed. Do we have better options? None that I can think of.

    I think it is implicit in your post that all of them are in good and scalable businesses. This is terribly important point which I think should be re-emphasized again and again: If we can find these qualities of integrity, energy, and intelligence in a scalable business with good economics and if we can get in at reasonable terms (read valuations), chances of success are high.

    Can these people fail despite all the factors mentioned above? Of course they can just as a chain smoker can go onto live a long life, but there is something called base rate which should be invoked here.

    Finally none of my thoughts these days conclude without invoking Mr. Buffett. In his famous talk The Superinvestors of Graham-and-Doddsville

    “For one thing, if (a) you had taken 225 million orangutans distributed roughly as US population is; if (b) 215 winners were left after 20 days;and if (c) you found that 40 came from a particular zoo in Omaha, you would be pretty sure you were on to something”

    Did he say all from that zoo would outperform? I don’t think so. But if you mix that population with overall population, they would stand out in aggregate. That is as good a probability that we would get and should aim for.

  44. Thank you Professor for sharing your wisdom and experiences. You are great teacher. Personally speaking, I have learnt a lot from you over the years and that has helped me become a better investor.

  45. Punit Mittal says:

    Thank you for your posts that continue to provide wealth of knowledge.

    I’m sure that one of the first thought that would pops up in people’s mind is survivorship bias but given that you invested in some of these companies (Avanti, Eicher etc) at a very early stage, I think we can safely assume that you identified these fanatics before they became roaring success. I’ve two questions on this:

    1. If we take an example of Buffett, we can find many of his investments were based on factors other than management quality such as AMEX, COKE, BAC etc. Some were clearly a combination of management and business quality, classic examples been Nebraska Furniture Mart, Borsheim and 3G. However there is one quality of Buffett that weighs higher than every other qualities of the managers, at least in the initial stages. It is TRUST. He has time and again picked up managers within Berkshire (Ajit Jain, David Sokol, Todd Combs etc) and outside Berkshire (Katharine Graham, ISCAR) based on trust. In fact in many of his letters, he has stated he would work only with executives he likes, trusts and admires. Some of them have worked out very well and others not so much. We cannot be certain if these managers had the qualities of integrity, intelligence, focus etc or they developed these qualities by copying the great master. So, my question is that when you initially study these companies and managers, is there some element of trust/faith/conviction that make you believe in these manager?

    2. It will be interesting to know the stories of failures especially where the owners/management were intelligent fanatics but the business did not do well.

    Thanks and Kind regards

  46. It is possible to identify parameter(s) and to write a good story – by analysing ‘winning’ companies with hindsight – ex-post analysis.
    ‘Built to Last’, ‘Good to great’ or ‘Firms of Endearment’ are some books that invoke such approach (and suggest key success factors of ‘winning’ companies); – these books tell a good story.
    Therefore, with ex-post analysis, and good story telling one can propose/suggest several parameters/patterns/success factors.
    Now, coming to parameters in the post:
    Entrepreneurs (or businessmen) are relatively more zealous (fanatics, if you may) and intelligent too. ‘Focus’ (if that is a subset of energy and intelligence) can be a differentiator; however there are good examples of winning conglomerates.
    ‘Integrity’ is possibly the only differentiator – it is a grey area – not easy to objectively measure integrity. However, if you take a vote on ‘companies/organisations with integrity’ you will find the usual suspects failing here. (Unanimity about winners is tough, but unanimity about losers is quite certain)
    Integrity is personal – it is about consistency in thoughts, words and deeds. Integrity at a business/organisation is an extension of this ‘manasa, vacha, karma’ alignment. It is also about putting the business (and interests of its stakeholders) ahead of oneself. This is not just for the moment, but for the foreseeable medium-term.
    If there is a way to objectively analyse/define integrity, one might test it (and patterns) ex-ante
    Notwithstanding this, finding an approach/pattern for investing is necessary – I would say a must. One could cultivate on his/her own or draw from the likes of Buffet et al. However, all things considered, one has to evolve something that works for him/her. What worked for Buffet may not necessarily work for others.
    Warm Regards

  47. I am a businessman and I can tell you, you are making business and success patterns out to be far more predictable than they are, are there patterns, of course their are, but you still have to roll with it, and you never have enough info for the next 10 years ! If you do, I would want to sell you a solar torch !

    Maybe I am biased because I have never met anybody in business who is trying to make decisions based on a 10 year prediction, are there aspirations, yes, but nobody runs a business based on a 10 year prediction !

    You use Asian Paints a lot as an example, but never give weight to the business and industry ecosystem which surrounds it !

    And you use a very niche strategy, not wise to write (you write very persuasively) as though stuff can be extrapolated to everything

    I enjoy what you write, I think you are da bomb as far as content generation based marketing + goodwill and positioning yourself for success are concerned, you are truly the master at these !

    Cheers !

    • Niche strategy? Guilty as charged. What’s I am doing is very very niche. One the initial filters I have is this question: Can you visualise what this industry will look like a decade from now? If the answer is a no, I’ll pass.

      So I agree with you that my methods cannot be applied to every business. Doing that will be dangerous.

      This talk was about the “people” factors in investing. It was a 20 minute talk. The fact that I didn’t address “business economics factors” doesn’t mean they aren’t important. They are more important than people factors. No matter how intelligent the fanatic, if the business economics totally suck, it won’t create wealth. But over the last few years, I have also noticed that a mediocre business in a commodity industry can be transformed into a good business by an intelligent fanatic. That insight has been very helpful to me in my journey as a learning machine.

      What I wanted to highlight was that extraordinary human beings, when you combine them with a reasonable business, you get lollapalooza outcomes. And as an investor, if you can get that combination with a reasonable entry valuation, then all you have to do is to exercise extreme patience to get a lollapalooza outcome for you.

  48. Thanks sir for the wonderful presentation and your follow up discussion on mysticwealth. Indeed very high dose of investing wisdom.

  49. Wonderful! Have noted some of these stories playing out in the last few years (Siddharth Lal etc).

    I have a question, what do you see as integrity in Modi.

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