Street Smart

Motilal Oswal started as brokers and proprietary investors at a time when the market was like the wild west. Nearly three decades later, the duo who started the firm have built one of the leading broking businesses in town. and they have also diversified into housing finance and private equity investment to keep business on an even keel during times of market volatility.

- T. Surendar

THERE’S AN OLD joke about a stock analyst and a Wall Street broker going to the races. The broker suggests putting $10,000 on a horse. But the analyst isn’t convinced: He says he wants to understand the horses and do a risk analysis before investing any money. The broker tells the analyst he’s too theoretical and bets on the horse. He ends up making a killing. “What’s your secret?” asks the analyst. “Simple,” says the broker. “I have two children, three and five years old. I added their ages and bet on number nine.” The analyst was stumped: “But three and five is eight.” The broker’s response? “I told you, you’re too theoretical. Didn’t I just show you that experimentally my calculation is correct?”

Jokes apart, money-making isn’t everybody’s cup of tea. And nobody knows that better than Raamdeo Agrawal, the 59-year-old joint managing director of Mumbai-based Motilal Oswal Financial Services (MOFS). Agrawal moved to Mumbai three decades ago to take the chartered accountancy exam and had no links with the city’s elite broking club. But with a combination of street smarts and tenacity—and perhaps a little bit of luck—he and his business partner, chairman and managing director Motilal Oswal, built one of India’s largest independent stock broking companies. Today, MOFS has a million clients under its belt and a market capitalisation of nearly ₹13,000 crore. Last year, its revenue rose 44% to ₹2,984 crore from ₹1,922 crore in the previous year, while profit leapt to ₹541 crore from ₹360 crore during this period. “I had no knowledge of research or investing but had a thesis that if you buy a good business you can make money. It worked and I have been hooked since,” says Agrawal.