Siddhartha Bhaiya, the 47‑year‑old founder of Aequitas, passed away while on a family vacation in New Zealand. He was a well‑known portfolio manager who often shared bold views about Indian stocks.
Sad Loss of a Market Veteran
Bhaya died on December 31, leaving behind a firm he built from the ground up. Colleagues remember him as a disciplined investor who combined deep analysis with clear purpose.
His Bold Market Warning
Just weeks before his death, Bhaya told investors that the Indian market was "a bubble of epic proportions." He explained that the headline price‑earnings (PE) ratio of the Nifty index looks low because it is dragged down by large public‑sector stocks that most small investors do not own.
- When you remove heavyweights like SBI, ONGC, NTPC, Coal India and Power Grid, the effective PE of the stocks most people hold jumps above 40.
- Mid‑cap and small‑cap stocks are even pricier, with PE multiples climbing beyond 50.
- He called the current surge in systematic investment plan (SIP) money a "Systematic Wealth Transfer" from India's middle class to the rich, noting that retail inflows line up with promoters selling shares.
According to Bhaya, the market's recent strong returns are driven more by this money flow than by genuine growth.
What This Means for Retail Investors
For everyday investors, Bhaya's view suggests caution. Even though the market appears cheap on the surface, the real valuation of the stocks you likely own may be much higher. He advises paying close attention to the underlying earnings and not relying solely on headline numbers.
Aequitas' Response and Legacy
Aequitas released a statement saying Bhaya was not only a visionary investor but also a builder of strong institutional values. The firm said it will continue to follow the disciplined, long‑term approach he championed.
Remember, this is perspective, not prediction. Do your own research before making any investment decisions.