Rakesh Jhunjhunwala Investment Strategy :- Name the Indian stock market and if you do not know about the investment strategy of Rakesh Jhunjhumbala, then the story of share market investment will remain incomplete. Rakesh Jhunjhunwala is known by many names. To others, he is Warren Buffett of India. Some called him a big bull. After that, he created a state of Rs 34,507 crore from the first capital of just Rs 5,000.
Rakesh Jhunjhunwala’s love for the stock market began when he was in college. He is a Chartered Accountant by profession. But his love lies in the stock market. He is a trader and an investor. As a young man, Rakesh Jhunjhunwala traded actively in the marketplace to build a large corporation and to be an investor.
Rakesh Jhunjhunwala made all his investments through his private investment firm, RARE Enterprises Ltd. Rakesh Jhunjhunwala plants in 38 cells.
Rakesh Jhunjhunwala Investment Strategy
1. Rakesh Jhunjhunwala believes that one should focus on buying business and not stock. Therefore, do not pay too much attention to the amount you buy in stock. It will not make much difference to the great system of things. Instead, focus on the business you are buying. There is nothing wrong with paying a small amount of money in a basically strong business.
Take the example of Rakesh Jhunjhunwala’s favorite stock Titan Company Ltd. Stocks grew by 10.04% between December 16, 2021 and January 16, 2022. Despite a sharp rise, Rakesh Jhunjhunwala raised 0.20% of the company’s stock in December. This is because you are buying a business and not a stock. Rakesh Jhunjhunwala is able to choose long-term stocks.
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2. Rakesh Jhunjhunwala believes there is no right price point for buying stock. But there is a good exit point. The best or most appropriate time to sell stock is when the stock price level becomes uncontrollable. This is what helped him make money during the Harshad Mehta scandal of the 1990s.
Rakesh Jhunjhunwala was convinced that market ratings were unstable and therefore short on market. Therefore, be very careful of the PE stock rate.
3. Rakesh Jhunjhunwala invests in Indian macro. This includes investments in the financial sector, health care, construction and real estate. This is a wise move. The population of India is growing. As living standards rise, people will seek better housing and health care.
This means that borrowing from both individual and business levels will increase. All of this means that financial stocks will always be needed.
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4. Rakesh Jhunjhunwala is a big money back on the balance sheet. He is always looking for companies with big money.
This is one of the reasons why he loves CRISIL Ltd. Data available on the official site of CRISIL Ltd. Shows how the cash equivalents with CRISIL Ltd since 2014. As we can see, CRISIL has always maintained a decent savings. This has helped keep it short of short-term funding.
5. Rakesh Jhunjhunwala is a major investor in companies with economic moats. This is something similar to Warren Buffett. Rakesh Jhunjhunwala’s portfolio contains many companies with strong economic resources.
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One such example is Delta Corp Ltd. This stock weighs about 1.72% in Rakesh Jhunjhunwala’s portfolio. Delta Corp Ltd is the one of the Biggest and most Profitable gambling company in India. About 55% of the market share of the formal casino market in India. Now opening a casino is a big deal with a lot of laws and government regulations. Even the demand for money is very high.
The closest competitor is Touchwood Entertainment Ltd. Its market capitalization is only 121 crores. This is actually nothing compared to Delta Corp Ltd.’s 7,901-crore market capitalization. And finally, Rakesh Jhunjhunwala strongly opposes investing based on hot stock tips. He wants investors to read the stock for themselves without overemphasizing what he is investing in or trading.
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Can you copy the Rakesh Jhunjhunwala Portfolio for profit?
No doubt Rakesh Jhunjhunwala is a maverick investor. It is therefore common for all of us to want to copy what Rakesh Jhunjhunwala did. But the problem is the delay in the flow of information. Rakesh Jhunjhunwala is a very active investor. He always buys and sells stocks. By the time the news of his entry into stocks reached, he had already booked his profits and moved on. So, you will never able to complete with that guy.
Please note that before investing in any stock, invest only after taking complete information about that stock.
I hope that after reading Rakesh Jhunjhunwala Investment Strategy article, you must have got an idea in which direction the growth of the company is likely to go in the coming years. If you still have any question related to this article in your mind, then do not forget to tell in the comment. Stay tuned to Market in India to stay updated with such important information related to share market.