ASK’s Sunil Rohokale investment picks

What was your first investment?

A residential real estate plot in Nashik. I think I was a real estate guy and prepared to think about the housing finance industry long before I could become a real estate professional. I tripled the money in two and a half years; it was the power of the earth in 1996.

Did you grow up in Nashik?

My wife is from Nashik. I grew up in Ahmednagar and studied engineering at a university in Pune. After that, I joined a company through an on-campus internship. Then, I did my management from Symbiosis. It had nothing to do with my previous degree in mechanical engineering. So my career went from management trainee to housing finance to investment/asset management.

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Going back to your first investment, you said you could multiply your money. Generally, people have a long-term approach in real estate. What made you think of getting out of it in such a short time?

I was 26 and barely understood the power of compounding. I am a science and engineering student, but I understood the power of capitalization significantly after joining a bank and later when I became a member of ASK. So in 1996 I was in a capital building phase. When you’re young, it’s important that you invest in something you understand, feel comfortable with, and can touch and feel. That was the mindset at the time. Quickly create a considerably large capital and use this capital to multiply. I never thought about longevity.

How did you evolve as an investor after joining ICICI?

At ICICI, I understood real estate and housing finance. Anything related to real estate, whether it’s an apartment, a shopping center, developed land, townships, warehouses or an industrial park, was my first love. The second was my Esops from ICICI Bank. So it’s very interesting. It is your choice to convert your Esops into real estate. That’s what I did in my career at ICICI. When I came to ASK, I reversed it. I liquidated most of my physical real estate investments in 2012 and transferred everything into stocks. I had invested in Bengaluru, Pune, Mumbai, Delhi-NCR. Real estate is an asset you could leverage. And in the rising market, leverage plays a predominant role. For example, we put money in Nashik at 100 per square foot in 2006 and three years later we sold it to 700 per square foot. We had 90% loan and 10% down payment, and the mortgage interest rate was 8.5%. Can you imagine the return on investment of your own contribution?

At the bank, I had a large property portfolio and one stock – ICICI Bank – and nothing else. I have never invested in a mutual fund in my life. I later realized that residential real estate was going to experience significant headwinds in terms of price, high interest rates, affordability and rental yields. It did not bring comfort, so in 2012-13 I left most physical real estate. So as we speak today, I have a larger portfolio of public stocks (listed 50% / and unlisted 25%) around 75%. I have 20% real estate and 5% debt. I have nothing in gold and alternative asset classes. I also have a housing finance company that I sponsor. I also did private angel investments with some of my known friends, who were starting a business.

Among the private angel investors, are there any unicorns you would have chosen?

No, at ASK, we have become the unicorn. Other than that, I’m not part of any unicorn so far.

So, within listed stocks, how do you choose stocks?

I do not manage my direct portfolios. I have portfolios that are with ASK portfolio management. It has large cap and large and mid cap stocks. I am chasing growth but I have some value color due to the margin of safety.

Do you follow PMS ASK or do you have your own method?

I continued with everything I had in the past. Now I only invest in the ASK wallet through the PMS ASK.

What kind of returns have you made if you exclude the value of your ASK stake?

My real estate returns in the very early years were heinous and I’m not going to consider them. So I’m only going to count the last 14 years. I gained 17-18% with real estate, 14-15% with the stock market and 7-7.25% with debt securities.

Any investment mistakes you’ve made in your career?

I think one of the angel investment teams came in looking for seed funding through IITians who used to run marathons with me. I think it didn’t go well. Maybe there was learning there. The devil is in the details and the execution, and entrepreneurs have to get into that part and find ways and means to get sponsors for the dreams they have. So it’s much easier to raise money at startup, but later on you need more sponsors to support your efforts. I think since then I haven’t invested any money in these e-commerce businesses.

Do you have life and health insurance? And in the past, has it helped you?

I started with an LIC policy, with a 5,000 bonuses. After 10 years, at maturity, I realized that the corpus was not what I thought it would be. The agent said you would have to buy a policy every year to get maturity sequentially. For three years from 1994, I took up politics. But the quantum of money was significantly lower than income growth or need. And I think that goes for all of us.

Do you involve your wife in family finances?

Absolutely yes. I think she is co-applicant in all my physical assets. So, she signed so many agreements. From a risk and succession point of view, it is always better to have one or two more owners. I make sure she knows everything about where I invest.

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