GD was stupendous. Gave a lot of examples and original ideas. Spoke the most. Helped others.
PI
Three Panel Members. I was in Panel 10 (For those of you at ML, Beng on the 8th Morning)
The room was dimly lit. Almost too dimly lit to make you feel sleepy. But after a stupendous GD I was all fired up and ready to face/defend whatever was thrown at me.
One was the alumnus. The one who had ‘nerd’ written all over his face. Must be an investment banker since he entirely diverted my hobby into a full on discussion on finance and investing. He was trying to sound very disinterested and tried to put up a stud-like attitude. (Smart-ass : SA)
Middle Prof , seemed Bengali, very well articulated flow of language, clear and crisp in questions, ready to help. (clarify the questions as in) (Serious Guy : SG)
The last prof who helped in moderating the GD, mostly remained silent but was enthusiastic whenever he asked questions and kept smiling all the time. Bengali, surely, from his accent. ( Enthu-prof : EP)
After the customary Good afternoons, I was seated in the middle. Lots of glasses and snacks on the table.
SA starts.
SA : So looking at your form, I believe you are a risk oriented guy. Why do I say that ?
Me : Because of Entrepreneurship and Equity-trading.
SA : How much have you invested in stocks ?
Me : Blah, blah.
SA : Returns ?
Me: Blah-blah. Mentioned recession lost money then again upsurge in Indian Markets.
SA: No leave all that. From start till end. Portfolio appreciation.
Me: Said
SA : Your general strategy ?
Me : I keep 60% large caps as fixed, and 40% I trade on a rolling weekly basis. These may be whatever I find interesting, or which shows particular momentum etc.
SA : So what all do you consider ? U mentioned fundamental analysis. Leave aside all PE and other ratios. Other than those.
Me : Market sentiments, news, external factors, political stability.
SA : Oh, really ?
SA : We shall come back to trading later. Lets start with your startup.
SG : What is it about ?
Me : said in detail about the business model, basics of operation etc.
SA : I dint really get that. Who are your clients/target ?
Me : Explained based on two divisions.
SG : Okay .. Tell me is it profit or non-profit ?
Me: Profit, but it has the social aspect of eradicating poverty etc.
SG : How do you make money then ?
Me : Explained the two-pronged revenue scheme.
SG : Okay. Tell me the division of total revenues from both.
Me : 60% and 40% explained my reasons.
SG : Where did you get the data from ? Don’t go on about the idea. Just tell me about your data source for target audience, your estimates etc ?
Me : Explained the two main sources of data.
<SG seems satisfied> SA meanwhile is hell bent on taking my case.
SA: Tell me a good reason why it might not work out.
Me; Explained the challenges in getting the database built etc. (Handled this numerous times during my Bplan ppt, so was pretty easy)
SG : Did you analyse your market competition.
Me: X does the same thing with a narrow based model. Explained difference in approach. Etc.
SG : X operates in ?
ME; Old Delhi
SG : Your startup ?
Me : Gurgaon ?
SG : So locking horns ?
Me : Yes Sir at one point our paths will intersect.
SG : Give me three bullets what X has done wrong and you intend to implement it when you go afloat.
Me: Gave 3 solid reasons. Well prepared.
SA : Lets talk about your equity investments, then.
Me : ??
SA : Heard of portfolio modeling ?
Me : ( WTF ? ) No
SA : So you dunno what PM is and you have been investing in equity for Y years. Fantastic.
Me : Sir, I understand and I do diversify my risks across various sectors to minimize chances of major losses. (Guessing the definition as I speak)
EP comes to life
EP : So why do us Indians don’t go for stocks instead of fixed deposits ?
Me : Sir, it is a matter of mentality, the savings mentality that we Indians have
EP changes expression. I change my line of reasoning.
…. Also, the time you need to invest to take care of your investments is very limited for working professionals. So the safer option is FD.
EP : Yes, it’s a problem even we professors of Finance have. <smiles> But why not go for bonds. What is it about stocks that prevents us the most. ?
ME : The risk !!
EP : Risk, eh ? Define Risk.
Me : (Give a totally lame definition.)
EP : No think and say.
Me : Risk in this context is the probability of you getting you capital invested back with an ROI.
EP : ROI ?
Me : (defines ROI)
EP :So time is an issue with trading eh ? What would you advise me ?
ME : Go for mutual funds.
EP : Again, risk !!
Me : (stuck) safer bonds etc…
SG : So how often do you trade in a week ?
Me : Depends on market activity. Flat markets 1ce/2ce a week, otherwise 3 times a week.
EP : How many times did you trade in the last month ?
Me: 8-10 times.
EP : Gimme names.
Me : Biocon, Yes Bank, Indian Bank, DLF, Syndicate Bank, IFCI etc.
EP :Tell me the brokerages you paid for them.
Me : ( Do some mental calculations of brokerages and tell them.) Fairly correct.
EP :No tell me individual brokerages.
Me: Told. (Might be wrong)
SA : Tell me Biocons price at whch you sold ?
Me: 350 odd.
SA: Over the past month ?
ME : Yeah (spot on, I sold Biocon at 356 but in late January, since then it has fallen to 320 odd)
SA : You talk about market sentiments a lot, What is that ?
ME: Said Libyan crisis may affect oil stocks ?
SA : Which all ?
Me : ONGC, IOCL (Might be wrong, on dangerous territory here)
SA, SG looks on suspiciously
Me: Due to the crisis, Brent Crude prices have soared and hence, market sentiment on these scrips will be negative, since these will affect expected revenues, unless they have hedged oil prices before.
SG :Are you sure ??
Me : Yes Sir.
SG : What else ?
ME: Political instability. DMK Cong split might send the prices falling.
SA : So lets say, SBI will its prices go down today if DMK announced split ?
Me: SBI as it is , it is overvalued, looking at its fundamentals….other factors…
SA : No stop, just due to this cause, how much will SBI go down today ?
ME: Market sentiment will be weak, all stocks will take a beating …so will a large cap like SBI
SA :Gimme a number.
Me: Thinking …… 3% fall.
SG : Will you put your father’s saving into that advice ?
ME: If my research is positive I will.
SG : No, will you short sell ? You know short selling right ?
ME: Yes, but I don’t go short. I always go long.
EP, SG : Why Why ?
Me : I tried shorting in day trading a few times, dint work out…so don’t do it anymore.
SG : But if you can go long, you can go short easily ?
Me : Sir, it’s a matter of confidence now. I just don’t do it.
SA : So do you look at detailed annual reports ?
Me: No sir, I just follow the condensed format, since trading is just a hobby I am happy to follow it in a limited way.
SA: So you don’t know what is portfolio modeling, don’t read balance books in detail.
ME: Tried to explain importance of ratios, liquidity etc, but In vain.
SA :So what if people buy the stocks at the right price, you are one day late and left behind.
ME: Even between the optimum buying and selling points there is enough space to make profits if you take on the right momentum drive.
EP : What is that beta you talked about ?
Me :No sir, I said price/book value ratio, not beta.
EP :I heard beta.
ME : Anyways, I can explain. Took two examples 1.1 and 0.49 and explained how each will follow Sensex or vary from it.
EP : So which is higher ?
ME: 0.49 will show more volatility. As it is further from 1.
SA : Okay, so tell me about your project at IIM Ahmedabad ?
ME: Told, as much as I could.
SA :No briefly !!
ME : Said.
SA : Conclusions.
ME : Explained why certain technologies cannot be implemented in India now due to huge capital requirements etc.
SA: Okay, we are done.
Thanking everyone, smiles appearing. SA was busy with his notes at all times.
I later came to know it was the longest interview of all IIMC ones at my batch. 35 minutes. Too long. My throat was dry to the core.
They remained skeptical at all times. But were listening and always let me finish my sentences.Was it a stress interview ? I don’t know.
Edit : Beta Answer totally wrong. My answer is actually a popular misconception.
So much probing on my hobby was kind of unfair. 
SBI answer correct, while the oil prices answer might be a bit shady.
Also, hoping they understood my business model properly and the revenue schemes. MArketing is is the focal aspect of my startup and I wish SA had allowed me to explain the 5-point programme I had so carefully designed.
Edit :
IIM Calcutta Converted… They don’t say “the more you get raped, the better are your chances”. Also, maybe they did like the versatility and risk taking appetite in my profile. I still remember “Risk-oriented guy, huh ?”.
