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How to Buy your First Share | Stock Market For Beginners in hindi | 6 Tips to pick great Stocks - YouTube
Channel: pranjal kamra
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The most memorable moment in
the stock market in when
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you age going to do your first investment.
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I remember it very well
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when the first time I had money in my account
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and I was going to buy my first stock
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I know how much nervousness it feels.
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And as a beginner, we like so many stocks
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but it is difficult to choose that
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which shares to buy first.
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Those of you who have already invested
in the stock market
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then you definitely remember your first investment.
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And you will also remember
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that how much scary it is.
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And at the beginning of this new year
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those of you who are going to do
their first investment
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those of you who are going to
buy their first stock
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especially they should watch this video.
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Because in this video, I have brought
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6 such tips
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which will help you
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very well help you to select your first stock.
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Which will make you much more profit.
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With that
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at the end of this video
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I have a very special 7th tip for you.
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Which you have never heard.
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Which will make you a successful investor.
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So let's start today's video.
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But before that
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make sure like the video.
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So I can know that you liked today's topic.
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Hello friends
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I am Pranjal Kamra
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Let's start Finology.
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Let me tell you that the 1st tip will be very basic
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and as we will go further on
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the tips will become more advance
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and the 7th tip
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is very very important.
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So let's start with the 1st tip
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and that is the Company's Track Record.
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you have always seen that
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it comes in the newspapers
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that RBI has fined this bank
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or SEBI has fined this bank
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news like this keeps comes out.
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Where some selected banks
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or some selected companies are
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stock exchange, SEBI, RBI
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and many other regulators
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keep on putting fines on them
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or keep on sending them some kind of notice.
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So if
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there is company, who is always
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given fines or warnings by any government body.
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Like if you read about banks
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then some two or three banks are there
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some irregularities are always been found in them.
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Those who are found
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that these two or four banks have every time
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did something wrong.
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There if we take Kotak Mahindra Bank
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or take good private banks like HDFC bank.
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Then anything big doesn't come from them
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like they did something wrong or something irregular.
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So if you are selection any company
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as your first stock.
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Then check that
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does your company every time
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gets stuck in some matter or the other
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against any government agency.
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There is nothing to do
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you just have to type your company's name
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and after it type in Google
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like XYZ company fraud
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XYZ company seam
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and whatever that companies history is
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will be in front of you.
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Always keep in mind that
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if one mistake is being caught
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then there must be four, five such mistakes
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which are not yet caught, but sometime it will be.
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Now think in reverse.
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Did you ever say that Asian Paints got into any problem
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did Pidilite came in the news for
any wrong reasons
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saw Colgate in any problem.
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No!
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So all the quality companies there, they every time
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every time stays controversy free.
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If any controversy is coming
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then you can think that
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many more controversies will come ahead.
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So it's better to stay away from these companies.
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So this was about the company's track records.
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Now let's talk about the track record
of those who run the company.
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That means the Management鈥檚 Track Record.
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Just think that you are investing in a company
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and this fear is haunting you
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if the company gets closed tomorrow?
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If the company's owner takes my money and ran away?
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Like there is a company named Ashapura Intimates
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whose owner is missing for a long time.
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And he has written letters to
the investors name
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where he has apologized
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for not managing the investors money properly.
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So can this happen with your company?
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If the promoter or owner got stuck in some problem
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and will they leave you midway?
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So to stay away from this problem
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especially when you are a beginner.
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So pick companies with very reputed owners.
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Like, can Adi Godrej run away with your money?
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Can Ratan Tata run away with your money?
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It's very very unlikely.
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So as a beginner, it is safe for us to
choose those companies
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about whom, throughout many years
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we have always heard good things about
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and their owners
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are respected by the market and the country.
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So this way your money will be safe.
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Let's understand the 3rd point with an example.
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You have the option to become
a partner in two businesses.
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One business is making a good amount of profit
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and there is no debt in it.
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And the second business
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is also making a good amount of profit.
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But that business has too much debt.
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So if you are becoming a partner
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then tomorrow you can also face trouble
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that have to repay the loan for that business.
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So in this case, which business do you like to choose?
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Most of the people
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will choose that company, which has no debt.
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Why?
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If there is no debt
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in out personal life or in our business.
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anywhere
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whenever there is loan there is tension in it.
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So be in stock market or in our life
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stay away from company's with high debt.
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As much debt free the company will be
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the chances of it getting bankrupted
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will be also that low.
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The lower the debt
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the safer your investment will be.
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But, let's know a interesting fact here.
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Did you know
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why there is limited(Ltd) in every company's name?
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Like
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Colgate-Palmolive Limited, Tata Steel Limited
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my company Finology Ventures Limited.
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Why there is Limited in every company's name?
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Because it tells that
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your responsibility of giving money is limited.
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That means even if that company has
a debt of Rs-100 crore
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but it's owners and share holders
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don't need to sell their homes
to repay that loan.
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A company is different from people
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a company's debt is repaid by the company
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it's owners will not repay it.
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So to showcase this
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there is Limited written in front of the company.
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So you can trust that
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if your invested company goes down tomorrow
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the creditors of that company will
not come to your house
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as you are the shareholder, so you give the money.
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This will not happen.
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Limited is written to tell you this.
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But!
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This doesn't mean that
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you can invest in a company
with any amount of debt.
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Why?
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Because your shares book value
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like if a shares book value is Rs-100
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this shows that
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against your one share
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the company has assets that worth Rs-100.
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So, as the number of assets the
company has will decrease
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as many assets, they will sell to repay the loan
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your company's share will also fall that much.
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So you won't have to sell your house
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because you invested in that company.
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But
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if the company has a lot of debt
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then your share will also never increase.
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Your shares price will keep on falling.
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Because the assets that company has
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will keep on selling.
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This is also a reason
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to stay away from companies with too much debt.
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4th thing
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You can go to Moneycontrol or Screener.in
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and must see that
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the stock you are liking
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it's sales should be regularly increasing
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and it's profit should also regularly increase.
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Increase in both of these is very important.
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If only one is increasing, then it's not enough.
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Like if only sale is increasing
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profit is not increasing.
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Then it's not a good thing.
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What it reveals that, the company
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is not focusing on growing its profit
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but focusing on growing it's sales.
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That means the company's focus
is not on growing profit.
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So see, without profit or low profit
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anyone can increase their sales.
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But the true great company's
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the true big profitable companies
are become by those
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who grow their sales along with their profit.
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Anyone can sale at low profit
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anyone can sell at a loss
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what's the big deal in that.
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But you see two examples.
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Eicher Motors or Page Industries
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Their products sold very well
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but they never compromised on their margins.
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They never compromised on their profit.
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That's why
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they were able to give their shareholders
multibagger returns.
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And let's see the second example.
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That sale is not increasing but
profit is increasing.
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In this cast, the danger alarm is that
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the demand for that company's products is limited.
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That means if they are selling 100 units
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then they can only sell 100.
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In this case
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by selling 100 units, any company
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how much can they increase the profit.
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How much efficiency can they bring.
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How much
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cheaply can they make the product.
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There is a limit to it.
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As long as sales don't increase
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the profit cannot continuously increase for some years.
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Eventually saturation will come.
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That's why sales and profit
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it's very important to keep growing both.
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As a beginner finding it is easy
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seeing it is easy
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so keep this in mind.
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5th important point is Return on Capital
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See there are many businesses
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which has a lot of margin.
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You sell a Rs-100 product
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and you made Rs-20 from it.
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That means a 20% margin.
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So it feels go to see that it's a
high margin business.
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But being a high margin business in not enough.
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We determine a business as good or bad by the
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amount of money that is invested in the business.
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To run it and to keep it running
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what was the total money needed for it
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and what return did they make
from that money.
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Because the margin is
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only for sales.
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It doesn't have fixed cost included in it.
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Like if you made a very big plant
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for making cement.
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So the net profit margin
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what will you see it on?
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That is how much sales you made
on one bag of cement.
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And behind it
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your plant running costs
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labors salary, how much was left
after giving all these.
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That will be your margin.
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But you have to see that
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total how much money did I spend?
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To buying raw materials and giving salaries
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plus
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on building the plant, on buying the land
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on getting the license from the government.
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How much did all of this cost?
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And how much profit came after it?
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So, it is known from Return on Capital.
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This means the total money that
I invested in the business
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how much profit did I make on it?
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So not only net profit margin
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but also Return on Capital
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is also important to be good for a business.
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And that is
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a right number to measure a business
as good or bad.
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6th point is Customer Satisfaction
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See for a short amount of time
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like for one or two year
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then any product
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with marketing
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as that product is new and innovative
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so it can sell.
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So in this case
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in that hype
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are you buying that share by getting
impressed by that company?
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So to check that
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will that company's products be popular
in the long run?
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Will they keep on selling or not?
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It is important
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you know about Customer Satisfaction.
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That those people who are buying
that company's product
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are they happy or not.
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Will they buy it again or not?
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So how can you know this?
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The best way to know this is
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that you pick such company's
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whose products you buy for yourself.
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So you as customer can review it.
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And how to do it?
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I have explained this in very detail
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in this video.
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You will find the link in the card above
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and in this videos description box.
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Definitely watch this video
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this will very much help you to
become a good investor.
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Now it is time for the most important
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very special tip.
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But before that
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if you haven't subscribed to this channel yet
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then press that subscribe button
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and yes
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don't forget to press the bell icon.
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So the notification and update of
my every new video
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keep getting you on time.
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So the 7th tip is
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to Think Like an Angel Investor
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Think that you going to make a very big
investment in the company.
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You are almost going to fully buy that company.
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Let's take an example.
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Think that you have Rs-5000 crore.
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So you see that what company's in India
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can I get for Rs-5000 crore.
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The condition is that, you have Rs-5000
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and you can only by one company
with that Rs-5000 crore.
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So let's take two company's example.
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One is DCB Bank
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and second is Zydus Wellness.
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Both of their market cap is Rs-5000 crore.
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That means all of the shares of
these two companies
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you will get for Rs-5000 crore.
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So now you have to see that
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should you buy DCB Bank or Zydus Wellness?
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So how can you see that?
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You need to see how much profit
these companies are making.
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You have to pay for either of the two
companies Rs-5000 crore.
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How much do these companies earn in a year?
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So DBC Bank earns Rs-250 crore
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and Zydus Wellness makes around Rs-130 crore.
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So suddenly, what did I find from it?
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That I am giving Rs-5000 crore
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but one company will give me Rs-250 crore a year
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and the second company will give me
Rs-130 crore a year in return.
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So which is the better investment here?
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Our brain starts to think itself.
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Some factors are to be added here
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like whose profit will increase rapidly further on?
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A small bank, which is growing fast
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or such a company
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who has 2-3 hit daily use products.
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Who has more growth?
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Who has less competition?
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After doing some calculations
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your brain will give you the answer on its own
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that what is the better option between them.
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So whenever
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you are selecting a company
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take a look at it's market cap.
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Dose that company has a Rs-1000 crore market cap
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or has a Rs-2000 crore market cap.
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After that see in that market cap
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what are the other companies you are getting?
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After that think of 4-5 similar size
market cap company's like this
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if you had fully bought one company from this
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then which one would you buy?
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Whatever answer you get
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take that company's share.
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And yes
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like if you want to
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get all the company's list, whose market cap
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is between Rs-900 crore to Rs-1100 crore
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then you can go to Screener.in
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and choose such a filter
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and whatever company in India
has that market cap
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whose market cap comes in that range
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you will get their list.
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So when I do stock picking
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then I definitely follow this rule
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it has helped me many times
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to choose the best option, not the second best.
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So if you also
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in such advance and unique way
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want to learn stock investing.
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With many various methods
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want to learn stock valuation
and stock picking.
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Then you can subscribe to
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The Academy of Value Investing course.
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Where for one year straight
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I will teach you
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to pick good stocks.
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And if you want daily updates on
stock market from me
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then you can follow me on Instagram.
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The Id is now on your screen.
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I hope you have liked this video
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I will be bringing more such videos.
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Until then
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This is Pranjal Kamra
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signing off
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Bye Bye.
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