Monday, April 22, 2024
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HomeInvestmentConfused about where to invest? Why not invest in what you consume

Confused about where to invest? Why not invest in what you consume

Investing always comes with many questions in my mind. Some of them include where to invest, which company is best in a specific sector, and how much capital I should allocate. If you are also juggling with these questions, let’s explore a simple concept that my mentor shared with me.

Think about your experiences when shopping. You likely visited many stores, and the one you frequented the most was probably the one where you liked the products or appreciated the quality of services. You may have rejected numerous stores due to reasons such as disliking product quality or experiencing poor service.

To implement this concept in investing, make a list of products you like. Then, check the company names on those products and see if they are listed on the Indian stock exchange. This approach combines personal preferences with market analysis, helping you align your investments with companies whose products or services you value.

Internet Providers

Obviously, we use our phones almost every minute these days, except while sleeping, right? Without the internet, it feels like having a gun without bullets. So, we can invest in internet companies like Airtel and Reliance Industries. Additionally, companies manufacturing ancillary products can also be considered, such as D-Link, probably have seen D-Link routers.

Malls, Shopping Centers, and Online Shopping

We often visit malls with friends and family for shopping or simply to hang out. Next time you go to these centres, analyse potential investment opportunities in companies listed on the stock exchange. Some examples include Reliance Industries (Reliance Retail, Reliance Food Prints) DMart, Metro Shoes, Trent (Zudio), Aditya Birla Fashion, Nykaa (Online Shopping), and so on.

Fast Food:

It is very obvious that when you visit a mall, you don’t just go without grabbing a snack – probably pizzas, burgers, and more. In such cases, investments in companies like Burger King, Devyani International, Jubilant Foodworks, and others could be worthwhile. On the flip side, if you prefer ordering food online and often use services like Zomato, investing in it could be a viable option.

Pharmaceuticals

Not only humans but every living creature becomes sick in their lifetime, and during these periods, we eat good and healthy foods and then take medicines to recover and become healthy again. Remember the tough times of COVID-19; these companies developed medicines and saved a lot of lives around the world. Companies like Sun Pharmaceuticals, Cipla, and Mankind Pharma belong to this sector.

FMCG:

We use numerous products in our daily lives, and we can consider investing in companies that manufacture these FMCG products. For example, Parachute oil, which is available in almost every home, belongs to Marico Limited. If you are a fan of Maggi, you can explore investment opportunities in Nestle India. There are many products around you; just take a look and start researching the companies behind the products you have already used, considering the quality checks that have been done.

Automobiles:

Almost everyone has their favourite products in every category, and in the vehicle segment, I have a Bajaj Pulsar 150, which I seriously love. It had been my dream to own one since my school days, and eventually, after starting to earn, I purchased it. In the four-wheeler category, I like cars from Tata. 

I can invest in these companies and become a shareholder or a part owner of these companies. Just find out your preferences; maybe you are already using their products and services, and they are listed on the stock market. Some examples include Maruti Suzuki, Bajaj Auto, Hero MotoCorp, TVS Motors, Eicher Motors for Bullet lovers, and so on.

Banking:

How can we forget the banks that safeguard every hard-earned penny? We can invest in banks, whether they are government banks or private banks; there are numerous options available. Some examples include HDFC Bank, ICICI Bank, Axis Bank, SBI, Bank of Baroda, and so on.

IT Companies:

If I mention IT companies here, you might likely be employed in one of them, such as TCS, Infosys, Wipro, Tech Mahindra, HCL Technologies, Coforge, Infoedge (Naukri.com), or Birlasoft. Considering these companies for investment is not a bad choice. With the increasing prominence of AI in the future, investing in these tech giants could be beneficial. 

Moreover, many of these companies offer Employee Stock Ownership Plans (ESOPs), allowing employees to purchase company shares. While being an employee is a moment of joy, becoming a part-owner is a source of pride, especially in the workplace where you contribute.

Conclusion

Investing is a mix of simplicity and complexity. It’s easy to identify stocks but challenging to find companies with stable financials, good management, and ethical practices. While starting with companies whose products we use is a good approach, thorough research on historical performance and financial health is crucial. 

Despite appearing lengthy, delving into these details reveals a fascinating world of steady growth, making the investment process both insightful and rewarding.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
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