Over the past three decades, I have learned many important lessons of life by investing in equity of businesses owned and managed by third parties. I am an amateur investor. My exposure to equity of third party businesses is usually tiny, mostly for more for the purposes of testing my socio-economic ideas and beliefs rather than making money. Nonetheless, I do this with all sincerity, investing adequate amount of effort and diligence.
One of my primary investment theses is based on the learning that human beings never accept defeat, not even from Mother Nature. We fight, mostly successfully, to find solutions to all the perils that threaten our existence. Smallpox, Plague, Cancer, Malaria, HIV, etc., are some examples.
In previous decade, "peak oil" (in terms of peak oil supply) was used as a potent weapon for fear mongering. Billions of pages were written specifying dates when the fossil fuel supply will end and humanity will slip into darkness. We are now talking about "peak oil" in terms of peaked demand for fossil fuels. There are suggestions that demand for fossil fuels might show negative growth over next three to four decades.
In past two decades, I might have read many reports about the looming water crisis. So much so, that it has become a common belief that the next major global war will be fought for water resources. As a devotee of Mother Nature, I am extremely concerned about the misuse of water resources. But, as an investor, I think water scarcity is an overrated threat, just like peak oil. I am confident that sooner than later, desalination will become affordable, just like long distance communication and solar energy.
Besides, in one decade or so, we would have discovered agriculture and cooking methods which are less water intensive; sanitation techniques that make our washrooms water positive; and many more such things. An innovation that may look far-fetched to many at this point in time, but certainly not unfathomable to me, would be to keep human body hydrated with minimal water intake, (e.g., one litter per week), just like camels.
I can already feel the invasion of airwaves and solar energy in our day to day life, replacing fossil fuel to some extent. The cost of generating solar energy has collapsed. Every day, many companies are joining what was once an elite club of water positive and carbon positive businesses. As per recent reports, Indian Railways would soon be joining the carbon positive business club. If we take the costing of ISRO's Mars mission a benchmark, the cost of communication shall also continue to ease rather rapidly, making work from home much more viable. Imagine, what happens to crude prices if 75 percent people start working from home, as cost of video conferencing collapses!
Traffic management in space will also be a major issue. We may soon have a Vienna type convention to regulate the Space in Space. Huge entry barriers for new players may be erected.
For a change, given the advances already made by ISRO in space technology, India could be at a significant advantageous position in negotiating Space Rights and Right of Way in outer space, with global community.
The pertinent point is that all these successful conquests of human being have resulted in massive successful investment themes. Pharma research, alternative and renewable energy and water have been and continue to be popular investment themes. Many investors may have made lots of money by investing in these themes at early stages. But as the contest ends with human victory, these themes tend to become utilities. As an investor I shall be investing in these themes only for annuity income in form of dividends.
Space technology is still not as popular yet with common investors, as it is mostly in State's domain. I shall be looking at this space keenly for "multibagger" opportunities.
Vijay Kumar Gaba explores the treasure you know as India, and shares his experiences and observations about social, economic and cultural events and conditions. He contributes his pennies to the society as Director, Equal India Foundation. Read his columns