Bhavook Tripathi: Analyzing the stock-picking strategy and philosophy of this market expert

Bhavook is known to have a concentrated portfolio and when he buys, he buys big!

Pune based-Bhavook Tripathi shot into super-stardom when he launched an open offer to acquire 26% of the share capital of R Systems International, a company engaged in providing software product development and BPO services. Tripathi invested Rs 40.81 crore in the open offer in 2011 and still holds the shares to this day. According to the latest corporate shareholdings filed as of September 2021, Tripathi holds 42,539,454 shares of R Systems International (35.6% of its capital) worth Rs 1,012.9 crore.

Looking at his massive stake in the R Systems, it should come as no surprise when we say that Bhavook believes in a concentrated portfolio. When he buys, he buys big. Unlike other investors who invest a bit here and a bit there, hoping that something somewhere will click, Bhavook instead waits patiently for that once-in-a-lifetime opportunity to show up, and when it does, he acts with conviction and pledges a sizeable chunk of his wealth on that bet.

Bhavook Tripathi made his first fortune with FAG Precision Bearing, a company engaged in the business of high-precision ball bearings to leading automobile companies. What he noticed was this blue-chip MNC had a low market capitalization of just Rs 35 crore. This was in 1999 when most of the market was obsessed with high-growth IT companies such as Wipro and Infosys. Unlike other investors, Bhavook had the vision to see that stock was unvalued and invested a huge chunk of his resources into the stock. He was proven right because FAG bearings went on to become a multibagger several times over.

The war chest gained by selling his stake in FAG Bearings was put to use while purchasing his second stock pick – a company called Solvay Pharma. This company was in the news because Abbott Labs was buying over the company in a global deal. A few paid attention to this news but Bhavook was among those that realized that sooner or later, Abbott would have to make an open offer to the shareholders of Solvay. A giant conglomerate buying over assets and willing to pay any sum of money to the Indian shareholders seemed like an obvious investment opportunity in hindsight but Bhavook was among the few that spotted it. There were some fluctuations in the stock price with a lot of uncertainty surrounding the company, but four years later, Bhavook netted a gigantic profit by selling the shares he purchased at Rs 488 to Rs 3,054.