Archive for October, 2014

How much can Rs 9500 grow to ??

Infosys came out with IPO in 1993 and it was a failure as no one knew much about IT companies then so hence did not invest.  By 2001 with three bonus and split 100 shares bought at 95 Rs in IPO became 1600 Shares ie around 23 Lacs in value. Today the same shares are worth around 5 Crs. In a span of 21 years the stock gave around 43% per annum returns.

I know several people who had bought infosys and sold it in 2-3 years, i happen to know even employees who sold off the stock, very few thought if the company is doing well and continues to grow, why should i bother about the stock price. To compare the house that i grew up in was owned and we never bothered about its price / growth in price, it was a home to live in. If Infy shareholders had the same long term holding capacity as they had for their house, gold and other tangible assets, they would today be dollar millionaires and the dividend would be enough to lead a good life !! Trick is to think of financial assets like we do our other intangible assets such as house, gold even silver articles and even brass utensils that we pass on from generation to generation without bothering to check the price.


Image and data source : Economic Times.

unnamed (1)