We all have read stories about how a person built up a net worth of billions through his startup or business, you’ve probably read about it enough. But today we will tell you about a man who invested only Rs 5000 and built a net worth of billions.
Meet late Rakesh Jhujhunwala whose approach to investing was a reflection of who he was. We won’t describe how he built up a net worth of billions through shrewd stock selection. Instead, we’ll talk about his approach to investing, his personality, and the convictions that helped him become a successful investor.
The Big Bull Of India, Rakesh Jhunjhunwala
Rakesh Jhunjhunwala was an Indian stock trader and investor. Born on July 5, 1960, in a Rajasthani Marwari household and was raised in Mumbai where his father, Radheshyam Jhunjhunwala, an income tax commissioner was posted. He completed his graduation from Sydenham College and applied for the Institute of Chartered Accountants of India.
Indian millionaire Rakesh Jhunjhunwala started investing in 1985 with a capital of Rs. 5,000 and made his first significant profit in 1986. He was also a successful stock dealer. Jhunjhunwala was the 438th richest person in the world at the time of his passing with an estimated net worth of $5.8 billion.
Along with being an investor, Rakesh Jhunjhunwala founded Akasa Air and was a chairperson and director for several businesses. He was also known as the “Big Bull of India” or Warren Buffett of India. Rakesh Jhunjhunwala was well renowned for his positive outlook and stock market forecasts.
A Young Man With Big Dreams
Rakesh Jhunjhunwala developed an interest in stock trading when he was in college, when one day he overheard his father discussing the stock market with his friends, and Jhunjhunwala acquired an interest in it. His father always gave him advice regarding the stock market, but Rakesh Jhunjhunwala never got any money for investing from his father.
He put his 5000 rupees into stock trading that he saved for work in 1985. Jhunjhunwala made his first significant profit of Rs.5 lakh in 1986 after investing his Rs.5000. He made close to 20–25 lakh in profit between 1986 and 1989.
From Rs. 5000 To Billions
His initial investment increased to 11,000 crores by 2022. His largest investment as of 2021 was in the Titan Company, which is valued at Rs.7,294.8 crore.
He was a partner in Rare Enterprises, a company that managed assets. Rakesh Jhunjhunwala served as the chairman of Aptech Limited and Hungama Digital Media Entertainment Pvt. Ltd.
Rakesh Jhunjhunwala was also a member of the boards of directors for Prime Focus Limited, Geojit Financial Services, Bilcare Limited, Praj Industries Limited, Provogue India Limited, Concord Biotech Limited, Innovasynth Technologies Limited, Mid Day Multimedia Limited, Nagarjuna Construction Company Limited, Viceroy Hotels Limited, and Tops Security Limited. He was on the Board of Advisors for the International Movement to Unite Nations of India.
From Sky Rocketing The Market To Starting Airlines
For Rs 176 crore, Jhunjhunwala acquired 6 of the 12 apartments at Malabar Hill’s Ridgeway complex from Standard Chartered bank in 2013. Later in 2017, he paid HSBC 195 crore to purchase the remaining 6 units in the building. After demolishing the previous structure in 2021, he started building a new, 13-story mansion that was 70,000 square feet in size.
He invested $400 million for a 40% stake in Akasa Air, an Indian low-cost carrier that he co-founded in 2021 with former Jet Airways CEO Vinay Dubey.
As of August 2022, the new airline flies to 3 cities and has 3 aircraft, with an additional order for 70 aircraft.
Things To Learn From Rakesh Jhunjhunwala
His declining health drew the attention of the audience during his previous interview. His wit and attitude held true despite the fact that he was unwell, in a wheelchair, scarcely able to speak, and needed frequent stops to collect his breath.
Just like Rakesh Jhunjhunwala, there are many people who have not stopped working hard even facing challenges in life – Read about People With Disability Who Are Turning No Stone Unturned To Make This World A Better Place
Despite being unwell, he spoke to the audience and advertised his airline. Scaling his business, was the thing he loved most. His interview was a testimonial to his tenacity and his love for his firm. As they say, business is in the blood of a Marwari and you can’t take that away!
Rakesh Jhunjhunwala was unquestionably a man of spirit. His legacy is unmatched by anyone else’s. Here are some important moments from his life that are inspirational for the whole generation.
- 1. Comparing Stock Markets With Women
Jhunjhunwala held the opinion that markets are just like women in that they are constantly in charge, enigmatic, turbulent, and intriguing.
The stock market is exactly the same: “You cannot have a good connection with a woman by beating her or bullying her; the only way you can have a good relationship with her is by accepting her, by following her, and by respecting her.”
He held that you need to respect and treat the markets well in order to understand them.
You must continue learning since learning the markets is a process, not a destination.
He claims that despite all these years, there is still more for him to learn about the markets. He openly used the example of his mother’s daal, stating that despite receiving numerous lessons from his mother, his cook was never able to replicate her daal, necessitating further learning a process in and of itself.
- 2. Be A Risk Taker
The word “risk” has four letters. It is an adverb. To various people, it has varied meanings. But keep in mind that while we can all try to foresee risk, debt, markets, and weather but we can’t predict with surety. Rakesh Jhunjhunwala believed, that danger is what makes life worth living. You will have nothing if you don’t take risks.
Rakesh Jhunjhunwala always took very calculated risks. He sold Rs 400 crore worth of shares in two days when Covid first struck. Leverage does not have a mother, father, or pals. Leverage is brutal. You should be aware of the danger you are taking before you do it. And if circumstances go against you, you ought to be able to take the blow without suffering personally or financially.
- 3. Be Opportunistic
Rakesh Jhunjhunwala adheres to the value investing tenets, which call for buying a stock when its market price is less than its intrinsic value. He advises that to choose the appropriate companies to buy, we should be opportunistic and conduct extensive research. After that, we should invest when the stock is not popular, which is when the market is ignoring it. As a result, we will be able to purchase the shares at a very attractive price and profit when the share price increases.
- 4. Be Optimistic
Another important lesson to learn from Rakesh Jhunjhunwala is that you should always think positively at all times as it is a vital component of the market investment. When we adopt a positive outlook, we will be better equipped to make informed decisions and won’t experience anxiety or pessimism whenever the markets experience volatility.
Additionally, he argues that we should never lose faith in India’s success narrative and our own skills. This will give us a solid conviction and enable us to decide wisely on our investments.
- 5. Be Emotionally Strong
Keeping control over your emotions is an important lesson to learn from Rakesh Jhunjhunwala. Having a firm hold over your emotions is crucial for generating money in the market.
Every investment you make should be calculated and reasonable, and we shouldn’t become anxious anytime the market takes a negative turn.
- 6. Be Consistent
We should invest our money in the stock markets consistently and hold on to our investments with a lot of patience. If we stick to investing for the long term, learn from our experience and adjust our investing style accordingly, we will surely make money from the market, sooner or later.
Our country needs more people like Rakesh Jhunjhunwala for better growth in India.
Feature image source – Facebook
There are more inspirational people like Rakesh Jhunjhunwala, you can also check this inspiring story about – A School Dropout From Kashmir – Check How Sheikh Asif Setup a Business Generating Millions