Rakesh Jhunjhunwala Story: The Warren Buffett of India
Rakesh Jhunjhunwala is a famous and wealthy Indian Businessman, an Investor, Trader and owner of Rare enterprises. Rakesh Jhunjhunwala is also known as “Warren Buffett of India” is the most famous and respected investor of India. According to Forbes, today, he is the 53rd richest person in India.
Rakesh Jhunjhunwala Story
Mr Rakesh Jhunjhunwala is born on 5 July 1960 in a very middle-class family in Mumbai. His father was an Income tax officer. He is fascinated with stock marketing since childhood. Whenever his father and business partners use to have a conversation regarding investment and stock marketing, he used to ask questions to his father out of curiosity, such As Why shares go up-and-down? His father always clarified all his doubts in detail. He has completed his graduation from Sydenham College of Commerce and Economics, Mumbai. After completing Chartered Accounting in 1985, he asked his father about starting a career in stocking marketing. Then, his father told him a few important things that still help him in his career. His father said to him:
- ” Always do what you are interested in”.
- ” Never come to my friends and me to ask for money.”
- His father encouraged him and said, “Be fearless”.
When Rakesh Jhunjhunwala started his career, he had only 5,000 rupees in the pocket. That time his brother, who was practising chartered accounting had a great client. That lady had a big capital and wanted significant returns. That time, the bank used to give 10% returns in a deposit. Rakesh offered her to give 18% returns per year because of this Rakesh got 2,50,000 rupees from that lady. He also took 5,00,000 rupees from one another person, and that’s how one by one he arranged his initial capital. In the beginning period of his career, Rakesh earned 8 to 10 lakh rupees by trading.
Then after a few years, he faced hurdles. In 1988, he bought Sesa Goa shares of 2.5 lakh at a price of 28 rupees and another 2.5 lakh shares in the cost of 35 rupees. After six months, Sesa Goa price increased to 65 rupees. In 1989, the government of VP Singh, Finance minister was Madhu Dhanwati. The 1989 union budget of Madhu Dhanwati became the career turning point to Rakesh Jhunjhunwala. Every common investor and stock marketer thought the budget of Madhu Dhanwati would concentrate on social things, not in the business that’s why there is a fear.
On the other side, Rakesh Jhunjhunwala was in different thought and believed that VP Singh, Prime Minister who was Thakur and had an excellent knowledge of business would never introduce such budget that hurt business. Then, the assumption of Rakesh Jhunjhunwala proved him right as the day of budget Madhu Dhanwati announced great budget which was supportive for business. Before this announcement, Rakesh Jhunjhunwala net worth was 2 Crores, and after five months of budget net worth increased to 40-50 Crores.
Then, he established Rakesh Jhunjhunwala company called Rare Enterprises, an asset management firm from where he manages his own portfolio. Rare stands for the beginning letter of Rakesh Jhunjhunwala and Rekha Jhunjhunwala. In 2002-2003, he purchased Titan Company (a big jewellery brand) shares in 4.5 rupees per share average price. Titan stock increased to 80 rupees then fell to rupees 30 after some time. Due to this, the value of Rakesh Jhunjhunwala portfolio deprived to over 300 crore but, he didn’t sell even a single share in the price of rupees 30. Because he believed that Titan would definitely grow.
Today the price of Titan shares is around 400 rupees. An investor should have patience in the stock marketing business, and here we noticed the quality in Rakesh Jhunjhunwala.
- Patience- Not only in Titan, but there are also various companies where he showed his excellent patience level. In 2005, he sold 27 crores of crisil shares and bought a flat in Malabar Hill, Mumbai. He always suggests having patience as a good investor.
- Learn from mistakes- After some time, he sold that flat at a significant price. He says that flat would have cost Rs 80-90 crore but “If I would not have sold the crisil shares of 27 crores then today its value would be around 700-800 crore. He never regrets any of his mistakes but always learns from them. According to him, Market is supreme that never goes right or wrong; the only credit goes to you. So, whenever you make mistakes, accept it first, then learn from them and keep going. If you never admit your fault, you would never learn.
- Experience and skills - He believes that experience is one of the wheels of investment, and we get knowledge from our mistakes. This is one of the success reason to Rakesh Jhunjhunwala investment.
- Be active- He says that a reasonable investor should be an active person. He is known for his long-term investment, but he is also an active trader. He strengthens his capital base at the beginning of a career with help of trading. He says that trading keeps him alert.
- Passionate- He says that you should be passionate about your goal. He didn’t make stock marketing his profession because he wanted to become a famous well creator, but because of his passionate behaviour towards stock marketing, and he enjoys it.
- Vision- He says that to get success in any area, you need to have the vision to achieve that. His journey of Rs. 5000 to 5119 Crores shows his excellent vision.
- Right decision at the right time- Rakesh Jhunjhunwala has always been the right time-right decision player. You have to select the right stock at the right time, and he has this quality to lead him in investing.
In the period of Rakesh Jhunjhunwala investment, he searched many multi-baggers stocks and engaged with many companies such as Crisil, Praj Industries, Lupin, Titan etc. that gave him a massive value of interest. Rakesh Jhunjhunwala believes in the growth story of India. He never attached emotionally to any stock and suggested this everyone. He purchases stocks to sell them. When he found that there is a need to hold any stock for long-term, he does that.
Rakesh Jhunjhunwala net worth is $ 2.3 billion means around 15000 Crore rupees. On his 60th birthday, 5 July 2020, he announced to donate 25% of his wealth. According to him, stock marketing is a very interesting business. Now he is also a movie producer of Bollywood movies like English vinglish, Ki & Is and Shamitabh. Today, he is involved in the board or committee members with several companies.
How did Rakesh Jhunjhunwala make his money?
His passion, vision and real taking ability towards stock marketing lead him to success. His profit from 8-10 lakh in 1986 to today's 5000 crores of net worth was an incredible journey. He always invests on right stocks and built strategies to sell them at the right time, and that’s how he earned fame and money in his career.
Is Rakesh Jhunjhunwala investing in Yes Bank?
Bulk deal data showed that Rakesh Jhunjhunwala purchased shares of Yes Bank at an average price of 67.10, valued the transaction of Rs 86.89 Crore. He bought shares of 1.29 crore on 4th of November, value to a 0.51 per cent stake in Yes Bank.
Get Paid Stock Market Courses at FREE of cost. Click here to subscribe to 14 Days' Free Trial on all our courses
Did you enjoy what you read? Subscribe to our newsletter and get content delivered to you at your fingertips!!