Thread by @Aditya_joshi12

How I made my first 1 Crore in the stock market ?

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I was initially investing in large caps like every investor and I eventually realized that large caps won’t make me money quickly as they will grow at a stable pace of growth.

To increase my CAGR, I started studying stocks which gave great returns in a short span of time and tried to understand the reason for the same

I came across 2 stocks called Graphite India and HEG limited which had made great money in 2018 and then the stocks collapsed.

I tried to understand why this massive rise and collapse happened.

The answer was supply demand mismatch. In the year 2018, these companies made huge profits because the prices of their products increased due to a temporary supply demand mis match

I understood that supply demand mis-match was the key to making quick money.

The only caveat was that these stocks will crash once the supply demand mis-match is restored and hence one needs to get out in time.

Hence I started looking for companies which had a temporary supply demand mismatch

I found a company named Nahar Poly which made BOPP. Some BOPP factories had shut down in China which led to believe that there could a temporary supply demand mismatch. This was also visible in the results of the company as company had started making good profits and increase them

So my logic of supply demand mismatch got validated through increasing company profits also

I had purchased Nahar Poly in late 2019 / early 2020 and kept on holding it despite the covid collapse.

Stock price had collapsed 40% in covid from Rs 40 to Rs 24 but I believed that the thesis is still there.

Consequently, once the covid rebound happened Nahar poly started making good profits and increasing them and stock price reacted positively as well.

I made approx 20 L in Nahar Poly, more than 200% returns. Dont remember the exact return percentage.

Eventually, the supply demand mis-match restored and their margins started falling and I sold when I saw the first dip in profits

I did something similar in Vardhman Special Steel and Laurus Labs. And made ~30 L in these 2 stocks also.

Held both of them till margin was expanding and sold once the profit started falling.

This supply demand mid-match concept made good money but you had to be on your toes to sell.

Eventually, I realized that buying a stock which can give increasing profits for 10 years is better than playing these temporary supply demand mis-matches and I eventually moved to long term investing

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