My Investing Framework
How I pick stocks.
Let me quickly explain what kind of companies I invest in and the framework I follow.
First of all, I take a lot of risk.
I’m not an HNI or an institution. I can’t buy shares directly from promoters. I buy from the open market, face volatility from global news, Indian news, SEBI regulations, everything.
So if I’m taking this much risk, I need growth — real growth.
1️⃣ High Sales Growth (Non-Negotiable)
For me, good growth means at least 30% sales growth.
If a company is growing at single digits, I’m not interested.
I can’t park my money in slow movers like HDFC Bank, Asian Paints, or similar companies where growth has already faded.
If I’m in equities, growth has to justify the risk.
2️⃣ Near 52-Week High (Relative Strength)
I like companies that are near their 52-week high.
Why?
It shows relative strength
It tells me that institutions are interested
Weak stocks don’t stay near highs
This is my second filter.
3️⃣ Fastest Growing in Its Sector
I don’t look for the best company in the sector.
I look for the fastest growing company.
Example:
HDFC Bank may be the best bank
But it’s not the best stock because growth is only ~8%
I want the company that is growing sales the fastest in its sector, irrespective of market cap.
Large, mid, small — market cap doesn’t matter.
4️⃣ Improving Margins
Growth alone is not enough.
I want to see PAT margins improving:
2% → 3%
2.5% → 4%
Or any clear upward trend
This tells me the business is getting stronger, not just bigger.
5️⃣ Aggressive Expansion
The company should be expanding rapidly:
New capacities
New plants
New geographies
Expansion is important to sustain high growth over multiple years.
6️⃣ Operating Leverage
I want operating leverage.
Meaning:
PAT growth should be faster than sales growth
This is where real wealth is created.
Final Thought
This is my rough framework.
Not perfect. Not rigid. But very clear.
I don’t invest in horses.
I invest in cheetahs — fast, aggressive, and built for speed.
That’s how I look at investing.