Rakesh Jhunjhunwala started his career in investment with a borrowed amount of Rs 5000, At the time of his death, his net worth was estimated at $5.8 billion. How did he do it?
Starting out as a chartered accountant, he decided to start his career in the stock market instead of going the traditional route of practicing. He made his first big money from the Tata tea stock. He later made the biggest fortune of his life through another Tata brand, (Titan).
It’s important to know about the Tata brand in order to understand Rakesh Jhunjhunwala’s success in the Indian stock market.
Tata is the most trusted brand in the Indian market. They have been making iron and steel in India since pre-independence time. Today, Tata makes everything, ranging from salt to steel. The brand is synonymous with trust and reliance. Rakesh Jhunjhunwala bought Titan (a Tata brand) for jewelry at Rs 40 in 2003. The stock has multiplied 95 times since then. Titan was a small percentage of his portfolio when Rakesh bought that share, today, it’s 35% of his portfolio. His conviction in Tata stock made his fortune.
The interesting thing about Rakesh is that, unlike other famous investors, he was a trader as well. He said on multiple occasions that he actually enjoyed trading. He said that trading is “Le fatafat de fatafat,” which translates to buy fast and sell fast. When asked how he can do trading as well as can be a great investor? He joked: how one manages a wife and a mistress. “Keep them separate,” he quipped.
Contrarian by nature, he never managed outside money. He said his only client was his wife, and he liked it that way. He enjoyed freedom.
Rakesh died at the age of 62, but he left a lot of lessons and wisdom for future investors. Believing your intuition with conviction, whether it be a choice of career or stock, will be one of my main takeaways from his life.
Here are some of his famous quotes on the market:
“You know, a balance sheet is like a bikini, it shows more but hides what is vital.”
“It’s better to buy a wonderful company at a fair price than a fair company at a wonderful price.”
“There are two ways to be fooled — one is to believe what isn’t true; the other is to refuse to believe what is true.”
“Markets are driven by cycle. Be prepared to ride the wave and stay invested for the long haul.”
“Always be learning and adapting. Market is changing, and so should you.”
“Keep your investment strategy simple and avoid unnecessary complexity.”
“Learn from your own mistakes, and don’t be afraid to admit when you are wrong.”
“Never run for companies that are in limelight.”
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