Who hasn’t heard of MRF? While we know it for having the best quality tyres in India, the stock market veterans know it for a whole different reason!
Madras Rubber Factory Limited, commonly known by the abbreviation MRF, is an Indian multinational and the largest manufacturer of tyres in India. It is headquartered in Chennai, India. The company manufactures rubber products including tyres, treads, tubes and conveyor belts, paints and toys.
Let us take a simple example of an investor who bought 100 shares of MRF in 2000, and being a long term value investor trusted the company and its credibility and held on to it for 17 years.
Value of investment in 2001: Rs. 55,100
Value of investment in 2017: Rs. 70,92,700
Profit on investment: Rs. 70,37,600
Dividends paid: Rs. 45400
This is another story of the beauty of compounding, and the power of patience with ability to identify a good company and sticking with it through recessions, depressions, losses and market changes.