Rakesh Jhunjhunwala's Portfolio

We are heading towards the financial year 2013-14 and investors already got in the high spirits when they saw Rakesh Jhunjhunwala portfolio and heard Rakesh Jhunjhunwala stating that he is very bullish on the markets and specifically the Retail and Agricultural sector. The major drive to the retail sector was the Government approval to FDI in Multi brand Retail sector and Rakesh Jhunjhunwala backed the decision by stating that the move shall increase competition and the consumption scale would increase with availability of variety and quality at cheaper rates. Rakesh Jhunjhunwala was hopeful that the Government reforms and RBI monetary easing would bring in positive sentiments in the market.

In the long-run retail sector would boom to a great extent reason being the ever rising retail demand. He India to turn into a 5 trillion economy by 2020 and the biggest beneficiary would be the retail sector. According to the government mergers and acquisitions in the retail sector is much awaited and shall benefit the loss making retailers who do not qualify as an 'industrial undertaking'. Moreover, cut in taxes to manufacturers and warehouse keepers shall enhance the quality and thereby decrease the prices and accelerate the demand. This will help to check inflation and bridge the fiscal deficit gap. Rakesh Jhunjhunwala portfolio consists of Titan Industries Ltd., Pantaloon Retail (India) Ltd. and Provogue (India) Ltd. out of which Rakesh Jhunjhunwala holdings increased in Titan by 0.56% in the last quarter. Speaking about his favorite stock Rakesh Jhunjhunwala states that Titan is the highest market cap retailer and has the potential to grow 18-20% every year and that the stock should be included in Nifty Fifty!

The rising demand for food from the ever growing population ought to bring a flourishing future for the agricultural sector. Land availability is scarce but the use of technology and quality seeds can definitely fulfill the demand. Agricultural sector was given highest priority as usual. Increase in expenditure target by 22% and farmer credit has increased by 1.75 lakh crore. Rakesh Jhunjhunwala holdings already include 10.3% in Rallis India Ltd. and nearly 5% in Agro Tech Foods Ltd.

This Diwali TV18 Broadcast Ltd. made an addition to Rakesh Jhunjhunwala portfolio. On the occasion of Laxmi Pujan i.e. the Muhurat trading day Rakesh Jhunjhunwala disclosed his stake in TV18 Broadcast Ltd, the second media sector investment after Mid-day publications. Rakesh Jhunjhunwala is bullish on the stock markets after next year as he expects inflation rate and RBI rates to ease. He forecasts 2014 Budget and election to bring something good for the investors.

To start with Rakesh Jhunjhunwala adds TV18 in his holdings. Giving a sector specific & stock specific view, he said that Digitization is a turning point for the entire television & broadcasting industry which aims at perfect competition and end of monopolies. Getting such channels specifically the news channels is going to be very costly business as profits will grow but not in proportion to the growing revenue.

TV18 being one of the top news channels in India, he is extremely bullish on this stock and he expects TV18's rank to move up further with the mergers, acquisitions, tie-ups or takeovers in this sector. According to him the stock fundamentals do not give a satisfactory buying signal but overall economic reforms considering FDI % in this sector and digitization shall boost the sector.

Rakesh Jhunjhunwala's upcoming holdings include Lupin, Praj Industries & Nagarjuna Constructions. He is bullish on the stocks but yet to reveal the time and quantity. Lets wait-n-watch.

Rakesh Jhunjhunwala added another feather in the cap by increasing Rakesh Jhunjhunwala holdings for DB Realty for a minority stake. He bought 4.5% stake of DB Realty from Trinity Capital. Now Rakesh jhunjhunwala's portfolio in the current year includes; Prime Focus, Viceroy Hotels, A2Z Maintenance, Spicejet, Mcnally & Geometric and now DB realty amounting to Rs 7.67 Cr, in addition to the previous holdings.

DB Realty is a flagship company of DB group and stands apart as Mumbai's one of the largest real estate developers. DB Realty Ltd is a Realty sector stock and was engulfed in the 2G spectrum case and now returning back to the Mumbai Realty market by commencing newer projects. The financial results of DB Realty in June Quarter too proved to be better than the previous one.

Within a week stock market records one more addition to Rakesh Jhunjhunwala's portfolio. He added another feather in his cap by buying 5% stake in Engineering sector company, Mcnally Bharat Engineering Company. Rakesh Jhunjhunwala spotted a consistent rise in the turnover since 2008 at 549.35 crores to 2079.20 crores in 2012. Currently 53% of the total holdings belong to the promoters. Mcnally Engineering belongs to the B M Khaitan group and is well known as one of the fastest growing mid-cap scrips in engineering sector. Earlier Rakesh Jhunjhunwala held stake in Mcnally through his wife's account. This is the first Kolkata based company where he holds such a significant stake. Mcnally has performed very well in the crisis situation and hence is expected to perform still better once the economic conditions improve.

Rakesh Jhunjhunwala portfolio is about to increase by 28.26 lakh more shares of Geometric Limited, an IT sector company that specializes in  Product Lifecycle Management (PLM), Global Engineering Services and Offshore Product Development solutions and technologies. Geometric Limited was established as the division of  Godrej & Boyce and provides IT consulting and Software solutions to many other industries like Aviation, Automotive & Machinery.

Rakesh Jhunjhunwala holdings already consisted of 5310000 shares i.e. 8.47% stake in the company up to the June 2012 quarter ending. His current holdings would amount to Rs.30 crores aggregate. Each share would amount to Rs.106 which would hike his stake by 4.50% individually.

Rakesh Jhunjhunwala is buying the stake from Credit Suisse, Singapore which is ready to sell all the shares at above mentioned price. Rekha Jhunjhunwala too holds nearly 1.58% stake in Geometric Limited. Other stakeholders in the company with more than 1% stake include; IDBI Trusteeship Services Ltd India, The Royal Bank of Scotland N. V. (London), Life Insurance Corporation of India, holding nearly 13.09% stake.

Miriam Beard rightly quotes that "The results of philanthropy are always beyond calculation." Philanthropy means giving a share of one's earnings to others voluntarily with pleasure and content which cannot be calculated. Rakesh Jhunjhunwala lives with it! Rakesh Jhunjhunwala once said, "When I make an investment, particularly in young companies, I see the field, the growth, the entrepreneur and the money needed. So, when I give money to a philanthropic cause, I look at the cause, the person who is leading it and the bang for the buck." Giving a bit to those who deserve it are his father's teachings to Rakesh Jhunjhunwala. Rakesh Jhunjhunwala's father recognized the worth of helping when he himself was helped by others during his education. Rakesh Jhunjhunwala is inspired by his father to give away a part of his wealth for a social cause. Considering 'Charity' to be his fourth child, Rakesh Jhunjhunwala pledges to contribute 1/4th of his wealth to the charity which characterizes him with Warren Buffet. He is amongst the top richest Indians and feels that he has more than what he and his family requires which can be shared with others. Rakesh Jhunjhunwala does not call himself, a philanthropist because he feels that everybody gets everything by the God's grace and one doesn't become great by giving what he does not own. Rakesh Jhunjhunwala believes that one who has it should be grateful to God and thereby contribute a bit for the needy. Dividend income being the only fixed income he earns, Rakesh Jhunjhunwala contributes 1/3rd of this to the charity and few years down the line he aims to contribute 500 crores. Rakesh Jhunjhunwala recently stated that he gave a right call (as for equity investment) when he contributed 50 lakh again this year to the Olympic Gold Quest and received huge returns with India wining six medals!!!!

Just read news about the Secret Journal Of Rakesh Jhunjhunwala and was taken aback to know that it was not Rakesh Jhunjhunwala who was maintaining the website, but a 26 year old Aditya Magal. Aditya Magal shared his stock market experiences and views under the name of Rakesh Jhunjhunwala and faired it. No sooner the second news flashed that Rakesh Jhunjhunwala denied to call himself 'Warren Buffet of India'. Where, Aditya Magal pretended to be Rakesh Jhunjhunwala, He denied to be Warren Buffet.
We ought to appreciate Rakesh Jhunjhunwala's attitude towards Aditya. He knew about the website since its inception, but did not utter a word. The website contains a humorous look out to investing as if Rakesh Jhunjhunwala himself is narrating about his current views towards the stock markets. Rakesh Jhunjhunwala gradually found that the website worked really well and hence taking keen interest in him, He invited Aditya to his Nariman point office. Rakesh Jhunjhunwala treats this as purely an inspirational thought!
On the other hand Rakesh Jhunjhunwala denies to be called as Warren Buffet of India. Warren Buffet, an American business magnate, investor, financier and philanthropist is a firm believer in value investing and frugality. Rakesh Jhunjhunwala has been following some of his stock market ideologies all through his investment career. However, Rakesh Jhunjhunwala somehow dislikes to be personified in this way. Rakesh Jhunjhunwala further states that the comparison is futile as Warren Buffett is far ahead of Rakesh Jhunjhunwala in terms of maturity, wealth and success.
Rakesh Jhunjhunwala has been an advocate of leverage and a risk-taker. Rakesh Jhunjhunwala just follows the trend and forecasts the entry and exit for the stocks, unlike warren buffett, who believes in deep research and analysis. He is passionate towards the stock markets and treats himself fortunate to have his first ever investment in Tata Tea a big success and a turning point in his life.
By these two stories Rakesh Jhunjhunwala just wants to address investors that don't copy, Just get inspired to create your own awesome ideas. So Rakesh Jhunjhunwala is not a clone of Warren Buffett but yes Rakesh Jhunjhunwala is definitely an inspiration for Aditya Magal.

• He started his career in this field soon after he graduated from Sydenham. He considers himself as the Big Bull of the market.
• He started with 5000 Rs when BSE Sensex was at 150. His first ever success was when he sold 5000 shares of Tata Tea @ 143 which he had purchased @ 43 with a time frame of 3 months, which showered upon him a profit of Rs. o.5 million.
• Subsequently, he could make his first million when he sold Sesagoa shares @ 1400 which he had bought at Rs. 27.
• It was the union budget 1990 which came as a turning point in his investing career, where he nearly made 5 times profit of his networth.

• Invest in a business and not any company.
• Maximise profits and minimize loses.
• Listen to others, but take your own decisions based on your own research.
• Be opportunistic but wait for the one to actually occur.
• Be happy with your gains but learn to accept losses with a smile.
• Historical stock prices help in predicting markets.
• Enter markets only if you are passionate about it.
• Patience may be tested but your conviction will be rewarded.
• Balance fear and greed.
• Invest for a long term.

Rakesh Jhunjhunwala is the Mother Theresa of the investment world because not only is this Living Legend eager to share his investment techniques with us but also happy to let us in on the most well guarded investment secret on how Rakesh Jhunjhunwala made his billions .

But, Rakesh Jhunjhunwala, the wise sage that he is, is a man of few words. Rakesh Jhunjhunwala is reticent. When Rakesh Jhunjhunwala speaks, it is because he has something to say and not because he has to say something! So we scoured through hundreds of transcripts to decode Rakesh Jhunjhunwala?s investment secrets. Now, we are proud to present our own version of Rakesh Jhunjhunwala?s tips on how to find multibaggers.

Rakesh Jhunjhunwala's Tip No. 1: Don't Look For Multi-baggers

Rakesh Jhunjhunwala's first investment mantra on how to find multibaggers is surprisingly different from what you would expect. Rakesh Jhunjhunwala says: "Don't look for multibaggers. Don't seek them at all. Let the multibaggers come to you!"

What is Rakesh Jhunjhunwala saying?

What Rakesh Jhunjhunwala is saying is: Don't go out into the investment world saying "I only want to invest in potential multibaggers". Instead, Rakesh Jhunjhunwala, the Investment Guru, says "Go back to the old-fashioned way of making investments designed by investment maestros Benjamin Graham, Peter Lynch and Warren Buffett". "If your homework is right and you have invested in fundamentally sound companies with good growth prospects, your investments will by themselves become multibaggers with the passage of time".

Sounds simple but Rakesh Jhunjhunwala is not content with giving abstract or theoretical advice because Rakesh Jhunjhunwala already knows that his disciples are a bunch of doubting Thomas and even his words of undeniable gospel will be met with stoic skepticism.

So, Rakesh Jhunjhunwala gives examples of what he means.

Rakesh Jhunjhunwala gives the example of BEML which several years ago was quoting at a pittance because it was regarded as a slothful government enterprise. No investor in his right mind wanted the shares of BEML at that time. But while other investors saw a sluggish government corporation, Rakesh Jhunjhunwala saw efficient management, a great product line-up and effeicient cash-flows. The result: Rakesh Jhunjhunwala got a bountiful; he got his multibagger.

One example is not enough. So, Rakesh Jhunjhunwala gives another example ? that of Bharat Electronics ? which also was regarded as a Babu-wala company by other investors who couldn't see what Rakesh Jhunjhunwala's discerning eye could. Another humble company turned into a multibagger by sheer passage of time!

Now you are convinced. But Rakesh Jhunjhunwala does not rest. He goes for the jugular. Now, Rakesh Jhunjhunwala gives a counter example.

What would an investor "looking" for a multibagger have bought in the heady days of 2000? The naive investor would have looked around and seen "spectacular" companies like Himachal Futuristic, Global Tele, Pentasoft soaring on the stock exchange, making new highs every day. So, the foolish investor would have tanked up on these shares thinking that these shares were his best bet to net a multi-bagger.

The result: You don't need the great Rakesh Jhunjhunwala to spell that out for you.

So, now you know why Rakesh Jhunjhunwala says: "Don't look for multibaggers!"

Yes, the point sinks in and you have understood but then you rub your eyes incredulously and ask "But what do I look for in a share?"

Rakesh Jhunjhunwala is not regarded as the greatest investor in India for nothing. He has a well-considered answer for that as well. And if you think about it, Rakesh Jhunjhuwala's answer is made up of pure common sense. Rakesh Jhunjhunwala's Tip No. 2: Don't Look for Profits; Look For Sources Of Profits

Rakesh Jhunjhunwala cautions that most investors obsess about the current sales and profits. They look at each quarter and focus obsessively on short-term profits. "That's missing the wood for the trees" says Rakesh Jhunjhunwala.

Instead Rakesh Jhunjhunwala says "Look at the sources of Profits. What are the reasons that will give rise to Profits in the medium and long-term term".

Rakesh Jhunjhunwala drives home the point. "Look at the factors and circumstances that will create an opportunity for business in the sector".

Rakesh Jhunjhunwala gives the classic example of Infosys and Wipro. While the average Joe would have sat with his calculator analyzing Infosys's & Wipro's PE, ROE and nonsense like that, an astute investor in the 1990s would have realized that an internet revolution was coming in the next couple of years. He would have also realized that the off-shore business segment was booming and he would have tanked up on those shares.

Rakesh Jhunjhunwala gives another spectacular example: That of Praj Industries, a company engaged in manufacture of bio-ethanol fuel. When Praj Industries started out, nobody realized the massive demand that would arise for alternate fuels like ethanol. An investor would could have foreseen that would have had his multibagger. Rakesh Jhunjhunwala's Tip No. 3: Forget ?Large Cap, Small Cap' Nonsense ? Look For Scalability Of Operations:

Rakesh Jhunjhunwala makes two very important points. First, the investing maestro expresses his contempt for the obsession that many analysts and investors have for the debate on whether large cap, mid cap or small cap stocks are better. "Forget all that and Look for Value" he thunders. "If there is value in Large Cap, buy it. If there is value in Small Cap, buy it. But don't obsess on irrelevant matters", says Rakesh Jhunjhunwala, the one with infinite wisdom.

But Rakesh Jhunjhunwala makes his preference quite clear. He says that given a choice and all things remaining equal, a mid-cap or a small-cap is a preferred bet because the valuations will be low and they can scale it up quite quickly. Rakesh Jhunjhunwala's Tip No. 4: Give it Time, Be Patient:

Rakesh Jhunjhunwala reiterates what the maha investment gurus like Benjamin Graham and Warren Buffett have been advising over the past several decades. Warren Buffett was plain in his advice "Our favourite holding period is Forever". Rakesh Jhunjhunwala gives the same advice: "Give your investments time to mature. Be Patient for the World to discover your gems". Rakesh Jhunjhunwala cites the examples of Crisil, Titan and Pantaloon Retail which he has held on for several years now and has absolutely no intention of divesting them any time soon.

When Rakesh Jhunjhunwala bought Lupin it was just another mid-cap pharma company starting out into the world of generic drugs. What Rakesh Jhunjhunwala saw was a good efficient management which knew its job, a debt-free status, a good product line up and a growing market. That's all. Rakesh Jhunjhunwala bought and played the waiting game. When the market matured, Rakesh Jhunjhunwala raked in his billions.

Rakesh Jhunjhunwala also fondly talks about his investment in Karur Vysya Bank which he has held onto even after about 20 years since he bought them. He says that his paltry investment of Rs 2,000 is worth several crores today thanks to the patience and conviction that he showed.

Rakesh Jhunjhunwala is never tired of emphasizing that first you must always remember that you are buying a business and not just a little thing that bounces 2% around every now and then. When you buy that business, it must be of a very high quality, one that is capable of growing over time. Having done your hard work, you must wait for the market to do its work and reward you, says Rakesh Jhunjhunwala. Rakesh Jhunjhunwala's Tip No. 5: Don't get carried away by short-term aberrations:

Rakesh Jhunjhunwala cannot stop criticizing investors who are obsessed with short-term trends. Rakesh Jhunjhunwala emphasizes that he does not worry about quarterly results. If the results are bad in one quarter, he does not get perturbed. What Rakesh Jhunjhunwala is looking for is: Is there a trend? Are the quarterly results showing a trend and suggesting something or are they a mere aberration?

Rakesh Jhunjhunwala also cautions that one should not get carried away by short-term trends. He cites the oft-repeated example of 1999 when investors bought truck loads of Himachal Futuristic, Global Tele, Pentasoft while he used to buy Shipping Corporation and Bharat Electronics because he saw long-term value in them. The Oracle of Mumbai says "Never get carried away by aberrations, recognize and respect them but do remember that the market corrects its aberration though it takes time."

Rakesh Jhunjhunwala then adds that if the market behaves irrational and punishes a stock for short-term aberration, that's the time for you to jump in. Rakesh Jhunjhunwala cites the classic example of Titan Watches to buttress his theory. Rakesh Jhunjhunwala says that Titan suffered in a moment of crisis when it went into Europe and lost a lot of money. Rakesh Jhunjhunwala says he wasn't perturbed because he knew that what is most important for Titan is India's prosperity. Rakesh Jhunjhunwala envisaged the future and knew sub-consciously that Indians were going to buy far many watches and that the underlying business should be great. So, says Rakesh Jhunjhunwala, in a moment of crisis you can get great valuations and if you can envisage the future where the product could have great demand and great growth, you should use the opportunity to buy. Rakesh Jhunjhunwala's Tip No. 6: Invest in a business that you can understand:

If you look at it hard enough, you will realize that Rakesh Jhunjhunwala's reluctance to buy Himachal Futuristic, Global Tele and Pentasoft even in their heydays and Rakesh Jhunjhunwala's preference to stick to Shipping Corporation, Bharat Electronics and the other tried and tested names reveals another great investment tip from the Prince of Dalal Street: Buy what you know. Do you understand the business enough to be able to know what will happen 10 or 20 years from today. With Shipping Corporation, you can because shipping of goods will continue to happen for our foreseeable future. But you can't tell that with technology companies which may have a great product today but which may become obsolete in 5 years.

Rakesh Jhunjhunwala's Tip No. 7: Don't worry about the macro stuff like fiscal deficit, inflation etc which are unknowable. Focus on what is knowable:

Rakesh Jhunjhunwala, India's greatest investor, for us folk who keep obsessing about currency fluctuation rates, inflation, fiscal deficit, political turmoil says: "Don't worry about things that you neither know about nor can do anything about. It's not important. Instead focus your energies on what you can and should know well enough ? the business of the company you are investing in".

Rakesh Jhunjhunwala's Tip No. 8 : Don't Try To Time The Market:

Rakesh Jhunjhunwala endorses the validity of investment advice that has been propounded time and again by the wizards of investment time and again. Never try to time the market because you can never find the bottom of the market. Instead if you are getting the stock cheap in terms of its intrinsic value and future prospects, buy it.Rakesh Jhunjhunwala echoes the words of the Oracle of Omaha when he says that you must get right is the business. If you get that right, everything else falls into place.

Rakesh Jhunjhunwala's Tip No. 9 : If it's cheap, buy it- Don't pass up something cheap today in the hope that it will get cheaper tomorrow:

Rakesh Jhunjhunwala says: If you see the opportunity today, GRAB IT! Many wonderful opportunities are lost to procrastination and then you rue your missed opportunities. Rakesh Jhunjhunwala says that it is not only important to identify the opportunity but then to be decisive and to act on it. Rakesh Jhunjhunwala cautions against getting stuck in a trap where you are perpetually seeking extra information to validate your idea.

Rakesh Jhunjhunwala's Tip No. 10 : Don't buy stocks that have a fixed return:

Rakesh Jhunjhunwala's next tip seems to be a no-brainer but it is surprising how many investors overlook it. What is the point of buying shares in a company such as an electricity company where the return on investment cannot by law exceed a certain amount, asks Rakesh Jhunjhunwala. But, Rakesh Jhunjhunwala, emphasizes that this logic does not mean that electricity and utility companies should not form part of your portfolio because they offer an excellent defense mechanism to the vagaries of the stock market with the undemanding demand for their product and their predictable cash flows.

Rakesh Jhunjhunwala's Tip No. 11: Ride your winners!!

The one question on everybody's mind is "When do I sell my multibagger?" Rakesh Jhunjhunwala answers with aplomb "Never".

One must be careful to understand what Rakesh Jhunjhunwala is saying here. What the Greatest Investor in India is saying is: "Don't sell for the sake of selling because you can never say that the 10-bagger today will not become a 20-bagger tomorrow".

But, Rakesh Jhunjhunwala hastens to clarify that this does not mean that one will never sell a multibagger. Rakesh Jhunjhunwala gives two situations when even he may sell his beloved multibagger. The first is when he is short of funds and he needs capital to invest in a stock that will give even better returns than what the existing one will give. And second, when the stock market has become so irrational that the perception of earnings and the P/E is unsustainable. Rakesh Jhunjhunwala gives the example of what happend in 2000 when euphoric investors laid bets that Infosys' earnings would double every year for the next 10 years. Infosys' P/E at the then current earnings was 100-150 times. So, says Rakesh Jhunjhunwala, when the expectation of earnings peaks and the P/E is unsustainable, that is the time to sell.

Rakesh Jhunjhunwala's Tip No. 12: Concentrate, concentrate & concentrate!!

There is a perpetual battle amongst investors on whether a diversified portfolio approach is better or a concentrated portfolio is better.

Rakesh Jhunjhunwala is an unabashed proponent of the concentrated portfolio theory. But Rakesh Jhunjhunwala's theory must be carefully understood before being implemented in practice as it can otherwise lead to disaster.

Rakesh Jhunjhunwala emphasizes that one must venture into a concentrated portfolio only after one is sure that he has identified a share that will deliver superior returns to all the other chosen shares. The conviction must be extremely strong, says Rakesh Jhunjhunwala.

Rakesh Jhunjhunwala is not one to take risks lightly so must also be wary of the risks of a concentrated portfolio. In the recent past, we have seen so many excellent companies lose large portions of their market cap almost overnight. So, while there are benefits to a concentrated portfolio, one must not be oblivious to its risks, cautions Rakesh Jhunjhunwala.