A conversation between a teenage girl Guna ‘G’ (who is interested in the stock market) and her dad ‘D’ at McDonald’s restaurant in Bangalore…
G: Dad, I like McDonald’s burger and other food items of McDonald’s. I like the customer service, as well. Is it possible for me to invest in McDonald’s business in India?
D: Let’s find out. Here’s McDonald’s bill/payment-receipt that we received when we purchased the burger. Check for the company name on the bill.
G: It says ‘Hardcastle Restaurants Pvt. Ltd.’
D: Search for ‘Hardcastle Restaurants Pvt. Ltd’ (HRPL) on the internet.
G: Ok. Searching for it on my cell phone. The first search-result shows ‘Westlife Development Limited’ (WDL). Let me check the website of WDL… It says – HRPL is a subsidiary of WDL, and the Company’s shares are listed on the Bombay Stock Exchange (BSE) Stock Code No. 505533. Does it mean that I can buy shares of WDL?
D: Let’s find out. Check for information about the company on BSE website.
G: Searching for “Westlife Development”.. Got it. I see the share price and other information related to WDL which means that we can buy shares of the company. Let’s buy some!
D: We will have to analyze the company before we buy its shares. There’s some homework you will have to do to understand how to analyze the company. Are you willing to do some homework?
G: I’m game for it! Tell me what do I have to do?
D: You will have to understand some basics. I recommend that you read the book ‘One Up on Wall Street’ by Peter Lynch
G: All right! Let’s order the book online. Searching for it on my cell phone now. Found it! It says – “One Up on Wall Street: How to Use What You Already Know to Make Money in the Market” by Peter Lynch. What does “How to use what you already know…” mean.
D: For example, you already know about McDonald’s food and customer service since you are its customer. Now, Peter Lynch will explain how to make money in the market using what you already know about companies like McDonald’s.
G: Sound’s interesting.
D: Let me know when you are done with reading the book. We will analyze Westlife Development Limited.
The conversation between Guna and her Dad continues in Episode 2.