Indrazith Shantharaj

A Master Thread Which Consists of All My Popular Threads😀

In just 4 months, China’s STAR 50 index, which includes major technology companies, crashed nearly 44%! Almost $500 billion in investor wealth wiped out in just 4 months. Over the last two years, China has been trying to revive its economy and reduce its dependence on American technology. So, government-backed funds started investing heavily in Chinese chipmakers, robotics companies and AI businesses. Seeing government support, millions of small investors rushed to buy AI stocks. Soon, AI stocks made up 42% of China's stock market value and 57% of its trading volume. At one point, companies in China's STAR 50 index were trading at nearly 250 times their annual profits! That means investors were paying ₹250 for every ₹1 of annual profit. And when valuations become this expensive, even small disappointments can trigger a massive fall. Take Unitree, a Chinese robotics company. Its IPO was reportedly oversubscribed 8,000 times! But when its profits fell 17%, investors started losing confidence. Its share price eventually fell by nearly 50%. However, China has an even bigger problem. Too many companies are competing for the same customers. Just like China's electric vehicle and solar industries, government support encouraged many companies to enter the AI business. Now, to attract customers, these companies may have to cut prices, hurting their profits. And this could be a warning for the entire global AI industry. But remember one important lesson. A technology can change the world, while many companies building that technology can still lose money. The internet changed our lives forever. But many internet companies went bankrupt. AI could follow the same path. So, don't confuse a great technology with a great investment. Valuation and profits matter!

I shared this chart on my Telegram and WhatsApp channels on October 26. Only 3–4 people appreciated it. Most people didn't like the idea. Some even responded with comments like: "How can you say this?" "India is in deep trouble." "FIIs are exiting India." "You are completely wrong!" In fact, many people were behaving as if it was the end of the world for Indian stock markets. But unfortunately, this is how stock markets behave. Markets often overreact to every situation. Positive news? Stock prices shoot up to the sky. Negative news? Stock prices fall much more than they should. This is both good and bad. It's bad because it creates fear, panic and pain for investors. But it's also good because market overreactions can create excellent investment opportunities for those who are prepared. That's why you should always be prepared for such situations. Keep some cash available, study good businesses, understand their valuations and have the courage to act when opportunities arrive. Because the best opportunities often come when most people are afraid to invest. As Warren Buffett famously said: "Be fearful when others are greedy, and greedy when others are fearful."

Deepinder Goyal’s ₹85,000 Temple wearable has sparked a huge debate on X. While some appreciate the innovation and its potential to become a global product from India, others especially some doctors question its scientific claims. Goyal believes Temple could go beyond health tracking and become an AI-powered personal companion. But its real-world accuracy, usefulness and long-term business potential are yet to be proven. What do you think? Innovation or expensive experiment? #temple

This is horrible!