Invest Rs.137 everyday for 20 Years = Rs.27.90 Crores

Few people made use of this beautiful wonder of the world called compounding (8th wonder of the world). There is also 9th Wonder of the World called "Compounding by Consistent Investing"

If you are really serious about it, it will definitely disturb your sleep tonight. For this analysis, i took a stock which most people said it doesn't move for years and most people (not the wise investors) think it was an useless stock but still in the top 10 list of Nifty 50. By now most people would have guessed the stock. Yes, it is none other than ITC, Kolkata based Indian Company

1910 to 1970 - Called as "Imperial Tobacco Company" , 1970 to 1974 - Called as "India Tobacco Company Limited" , 1974 to 2001 - Called as "I.T.C Limited" , 2001 to Present - named as "ITC Limited"

Many know this as an Cigarette manufacturing company, but they have many other businesses, which we can see later in this blog. I have made 2 scenario's in reading this company returns & wealth generation:

1. Invest Rs.50,000 in 2000 and left for compounding

2. Invest Rs.50,000 in 2000 and keep investing Rs.50K every year (which is Rs.137 everyday)

Let's take the 1st scenario: Assume i have invested Rs.50K in 2000. The stock price of ITC in 2000 was Rs.15. I could have owned 3333.33 (roughly 3333) shares for 50K. The company have given 3 bonuses and 1 split and a remarkable dividend rate every year since 2003

By this way, we would be holding 1.5 Lakhs shares by now and have collected Rs.1.039 crores as dividend and Rs.3.15 crores net worth. Together on total = Rs.4.189 crores. This is just by investing the initial amount of 50K and holding on to the stock. Literally not doing anything

Let's take the second Scenario: Invest Rs.50K in 2000 and keep investing Rs.50K every year (which is Rs.137 everyday). we would have collected the same 3 bonuses and 1 split and the dividend rate every year, but the difference is compounding by consistent investing. Check the magic (sorry logic) below

If the above was done, we would be holding 10,02,400 shares. Dividend Received = Rs.6.85 Crores, Holding worth = Rs.21.05 Crores. On total it is Rs.27.90 Crores

For this i need to invest Rs.137 everyday consistently. Is that a tough job ? What if i had invested more than 137 rupees everyday and if i have the capacity to invest Rs.500 everyday, what then ? You calculate yourself

Please note (Disclaimer): you need to choose your company wisely. Not every company behave this way. This post is not an trading advice, this is for your information. please consult your financial advisor for investing / trading

Let's have a quick look on 

click here for Brands of ITC 

They are into FMCG, Hotels, Paperboards & Specialty Papers, Packaging, Agri Products, Information Technology and Cigarette Manufacturing Businesses. Market Capitalization of the company is Rs.2,56,200 Crores, You can own a piece of this company by just investing Rs.210 (value of 1 share as of 29th July 2021)

Now you know the value of Rs.137 and what this amount can bring to you in future. So spend very reasonably, save money and own the quality businesses. Also remember every Rupee we spend today is worth more than Millions in future if it is invested wisely

This blog is only for Long-Term consistent investors. You don't need to be a billionaire to invest in Stock Market but definitely you need to invest in quality Stocks to be a Billionaire.

Have a Great Day 😊

B G Nareshkumar