Books on Investing and Stock Markets

There are a lot of books written on 'investing' and 'stock markets'. Many of these books are a treasure trove of knowledge. In my journey of investing, I have read a lot on markets and still do, whenever I can. 

The following books which according to me, are worth reading time and again:

• 'The Intelligent Investor' by Benjamin Graham. This book is the textbook of investing. Everyone who is into markets or even thinking about it should read this. Timeless wisdom in this book. It should be there in the book shelf. 
• 'Security Analysis' by Benjamin Graham and David Dodd. Basics of fundamental analysis and Interpretation of financial statements discussed in a greater detail. The book espouses the true concept of Value Investing. Must read for anyone who is interested in Fundamental Analysis.
• 'The little book that builds wealth' by Pat Dorsey.
• 'The little book that beats the market' by Joel Greenblatt.
• 'Reminiscences of a Stock Operator' by Edwin Lefevre.
• 'Common Stocks and Uncommon Profits' by Philip Fisher.
• 'Poor Charlie's Almanack' by Charlie Munger.
• 'The Thoughtful Investor' by Basant Maheshwari.
• 'Gurus of Chaos' by Saurabh Mukherjea.
• 'India's Money Monarchs' by Parag Parikh (It's a collection of interviews of prominent Indian investors who have succeeded in the market)
• 'Graham, Buffett and me' by Aryaman Dalmia. This book was written when the writer was 14 years old. Some interesting insights on investing.
• 'The Unusual Billionaires' by Saurabh Mukherjea. The story of 8 companies on how they have built and sustained their competitive moats over a period of time. The book is a must read for anyone having interest in number crunching and financial analysis.

Examples of the Magic of Compounding in the Markets

There have been some great returns from some well run companies for last few decades and that has been attributed to the 'power of compounding'. Now, Compounding is the process of generating earnings on an asset's reinvested earnings. 

To work, it requires two things: the reinvestment of earnings and time. The more time you give your investments, the more you are able to accelerate the income potential of your original investment.

See for yourself, how the magic of compounding works over a period of 20–30 years.

• Rs 10,000 invested in Eicher Motors in 1992 is worth today - Rs 80 lacs
• Rs 10,000 invested in Asian Paints in 1986 is worth today at Rs 90 lacs
• Rs 10,000 invested in Dr Reddy’s Labs in 1986 is worth today at mindboggling Rs 10 crores.
• Rs 10,000 invested in Shree Cement in 1990 is worth today at Rs 2.90 crores.
• Rs 10,000 invested in Torrent Pharma in 2008 is worth today at Rs 2.19 lacs (approx) (that’s more than 21 times in 9 years)
• Rs 10,000 invested in Granules India in 2008 is worth today at Rs 2.97 lacs (almost 30 times in 9 years) (Stock was at Rs 28.20 back in 2008 and there was split in face value from 10 to 1 in 2015)
• Hold your breath for this one. Rs 10,000 invested in Ajanta Pharma in 2008 would be worth today at Rs 24.42 lacs. (More than 240 times in 9 years)

Barring these companies there are many companies which have grown tremendously in the last 20–30 years. We all have read about the investing returns from Infosys and Wipro over the last 3 decades.

There are companies like Bajaj Finance, BPCL, Lupin, Natco Pharma and HPCL which have delivered 50–60x over a period of last 20 years.

Happy Investing!

(Source; Compiled information available on various websites like Money Control, BSE India, Yahoo Finance and Google Finance)