Dalal Street mogul
’s success story with Indian stocks has all the stuff that legends are made of.
Often referred to as India’s own
, Jhunjhunwala was just another Mumbai chartered accountant until one day he decided to break ranks and plunged headlong into the stock market with just Rs 5,000 as capital.
By September 30, 2018, that capital had swelled to Rs 11,000 crore, marking out the trailblazing journey that he charted out to become one of India’s most successful stock investors.
Born in Mumbai on July 5, 1960, Jhunjhunwala is probably the perfect example of a common man with an exceptional intellect.
The Big Bull credits his father for developing his early interest in the stock market. RJ says he used to often hear his father, an income-tax officer, discuss stock market with his friends. As he grew up, RJ’s curiosity about the stock market grew, and he would often question his father about stock price fluctuations. His father advised him to read newspapers as he felt it was the news that made stock prices to fluctuate. “This was the first and a very valuable lesson that I learnt from my father about the stock market,” Jhunjhunwala reveals in a video now available on YouTube.
But this journey of becoming the king of Dalal Street hasn’t been an easy one. It’s been an awe-inspiring tale of a boy hailing from a humble middle class household and his rise to the Forbes’ List of billionaires.
Jhunjhunwala’s rags-to-riches story has been truly inspirational!
Where it all started?
The market honcho soon got fascinated by Dalal Street and expressed his desire to pursue a career in the stock market. However, his father asked him to first get a graduate degree. Jhunjhunwala graduated from Sydenham College in 1985.
After graduation he again discussed his plan with his father. His father permitted him to do so on the condition that he would not support RJ financially, nor should he ask any of his friends for money. He should earn and invest his own money.
Big Bull enters Dalal Street
Jhunjhunwala, also known as the ‘Big Bull’ of Dalal Street, entered the stock market with a meagre Rs 5,000 in 1985. Sensex traded at 150 points back then.
The Big Bull soon realised that to become a successful investor, he would need more funds. He requested one of his brother’s clients to lend him capital and, in return, promised to give higher returns compared with bank fixed deposits.
From the very beginning, RJ’s risk-taking ability, imagination and wisdom earned him huge profits. His first big profit was Rs 5 lakh which he earned in 1986. He bought 5,000 shares of
at Rs 43 and the stock rose to Rs 143 within three months, giving him over three-times profit.
In the next few years, Jhunjhunwala made good profits on a number of such stock bets. During 1986-1989 alone, he earned Rs 20-25 lakh.
RJ’s major investments included Sesa Goa, which he had bought at Rs 28 and then increased his investment at Rs 35. Soon, the stock rallied to Rs 65. In 2002-03, he bought ‘
Company’ at an average price of Rs 3, and he is still counting his profits on that investment.
During his long career in the stock market, Jhunjhunwala has successfully invested in a number of multibagger stocks such as CRISIL, Praj Industries, Aurobindo Pharma and NCC.
But he has also had his share of failures. After the 2008 global recession and in the subsequent years, Jhunjhunwala’s stock prices fell by 30 per cent, but he bounced back and recovered the losses by 2012.
RJ‘s life is a fitting example of the adage that one has to devise ways to solve problems through experiences and lessons learnt from life.
Jhunjhunwala today manages a privately-owned stock trading firm called RARE Enterprises – a name derived from the first two initials of his and his wife Rekha Jhunjhunwala’s names.
Rakesh Jhunjhunwala’s equity portfolio
Big Bull’s top stocks
7 Oct, 2019
Starting with just Rs 5,000 in his pocket in 1985, Rakesh Jhunjhunwala has scripted one of the biggest success stories on Dalal Street. According to Bloomberg Billionaire Index, Big Bull’s net worth stood at over $2.5 billion (Rs 17,500 crore) at the end of August, 2019. Often referred to as India’s own Warren Buffett, the Big Bull owns more than 1 per cent in over 30 stocks, valued at over Rs 13,000 crore. Let’s take a look at the top 10 stocks of the ace investor:
7 Oct, 2019
Jhunjhunwala held 7.05 per cent stake worth Rs 7,837 crore in Titan as of June end, 2019. The company’s stock is up 34.41 per cent year to date. The billionaire investor has been hit due to an industry-wide slowdown on account of financing issues and delayed payments for ongoing infrastructure projects.
7 Oct, 2019
The drugmaker is another company where Jhunjhunwala has over 1 per cent stake (1.71%) as per June quarter shareholding data. The stock has slipped over 20.08 per cent year-to-date. The total holding value in Lupin is over Rs 520 crore.
7 Oct, 2019
Jhunjhunwala’s other significant stock is Crisil with 5.49 per cent stake worth Rs 516 crore. The stock of the rating agency is down over 19.7 per cent this year.
7 Oct, 2019
Big Bull holds 2.93 per cent stake worth Rs 492 crore in the Kochi-headquartered lender. Federal Bank had reported 46 per cent jump in June quarter. However, shares of the private lender are down 9.5 per cent in 2019.
Big Bull’s philosophy
Rakesh Jhunjhunwala believes in order to become a successful investor, one has to make mistakes and learn from them.
“If you do not believe the markets are supreme, you will never admit that it was your mistake. If you don’t admit that it is your mistake, you will never learn. To succeed in the stock market, one not just needs the ability to learn from mistakes, but also to blame only oneself for it,” he says.
“I don’t blame promoters of companies. I blame myself. The promoter is what he is. I have to recognise it if he is not what I expect him to be,” he remarks.
Jhunjhunwala says there are no shortcuts to success. “One should always rely upon the knowledge readily available in the market to become a successful investor,” says he.
Jhunjhunwala’s knowledge of stock market and philosophy of investment has earned his shareholders huge profits.
Being a philanthropist, RJ believes in charity and tries to help the poor. He feels it should not be done with any expectation of good results.
(Disclaimer: This article is based on various videos of Rakesh Jhunjhunwala available on YouTube)