IKIGAI's Pankaj Tibrewal Reveals Blueprint for Identifying India's Next 100-Bagger Companies

The next wave of India's wealth-creating companies is expected to emerge from steady, long-term growth rather than flashy market events, according to Pankaj Tibrewal, founder and CIO of IKIGAI. In his latest newsletter, Tibrewal outlined the key characteristics that have defined India's and the world's 100-bagger companies—stocks that have multiplied 100 times or more.

"Most people think great investing is about spotting the next big event, but the biggest fortunes in the stock market were built in a far quieter way," Tibrewal wrote. He emphasized that extraordinary returns come from owning ordinary-looking businesses that quietly compound year after year.

India's 100-Bagger Success Story

India has already produced more 100-baggers over the past 25 years than the United States and China combined. Notable examples include:

Key Characteristics of 100-Bagger Companies

Small Beginnings in Large Markets

A defining trait of 100-baggers is starting small in industries with massive potential. Bajaj Finance exemplifies this principle—it held just 0.10% of India's consumer credit market in FY08 and today controls only 2.30% despite becoming one of the country's largest financial institutions.

"The opportunity never ran out and that is what allowed it to grow steadily for decades," Tibrewal explained.

Similarly, Titan began as a watch company before expanding into jewelry, eyewear, wearables, and luxury products. Pidilite built a household brand in adhesives and sealants, while Shree Cement leveraged operational efficiency to dominate India's cement sector.

Earnings-Driven Growth

Tibrewal emphasized that long-term wealth creation depends on profits rather than short-term market headlines. "Earnings do the real work. The market reacts to news in the short term, but over time, steady growth wins," he noted. "Some years were great, some years were bad—but the long-term direction was always up."

High Returns and Reinvestment Capability

Another critical feature is the ability to reinvest profits at high returns. Companies like TVS Motor and Torrent Pharma reinvested earnings into new product lines, markets, and technologies, generating compounding growth.

"If a company earns 20% on every rupee it invests, and can keep finding ways to invest more, its value grows very fast," Tibrewal explained.

Founder Leadership and Long-Term Thinking

Founder involvement proves critical to long-term value creation. Companies led by their founders or owner-operators tend to think in decades rather than quarters. "Founder-led companies make disciplined decisions and think long term. That is what helps compounding survive," Tibrewal observed.

Durable Competitive Advantages

Strong competitive moats protect profits and ensure sustained growth. These advantages include:

• Strong brands: Titan, Pidilite
• Cost leadership: Shree Cement
• Distribution networks and data analytics: Bajaj Finance
• Niche leadership positions: Balkrishna Industries

"These advantages allow companies to reinvest at high returns even when competition intensifies," Tibrewal wrote.

Global Examples Follow Same Blueprint

The same principles apply globally. Tibrewal cited Amazon's evolution from online bookstore to cloud and e-commerce giant, Apple's compounding despite multiple 50%-plus drawdowns, and Alphabet's reinvestment of profits into YouTube, Cloud, Maps, and AI.

Even Monster Beverage grew steadily through strong branding and an asset-light model, while Netflix transformed from DVD rental business to streaming leader.

IKIGAI's Portfolio Strategy

IKIGAI applies these principles to its investment approach, focusing on companies with specific characteristics:

Tibrewal cautioned that even extraordinary companies test investor patience. Apple experienced three crashes exceeding 50%, NVIDIA fell 75% twice, and Amazon collapsed nearly 90% during the dot-com crash.

"The stock market does not reward intelligence alone. It rewards patience, resilience, and the ability to stay invested when it feels hardest," he concluded.