India’s Best Known Investor Leaves Vacuum
Rakesh Jhunjhunwala, the billionaire investor from Mumbai known for big bold stock market bets and a larger than life presence, died Sunday morning after complications precipitated by diabetes and kidney failure
Rakesh Jhunjhunwala, the billionaire investor from Mumbai known for big bold stock market bets and a larger than life presence, died Sunday morning after complications precipitated by diabetes and kidney failure. He was 62.
Jhunjhunwala, was born in Hyderabad, and grew up in Mumbai, attended college at Sydenham College of Commerce and Economics-- where he was a batch junior to Uday Kotak--and was an accountant by training.
Christened the ‘Big Bull’, Jhunjhunwala’ was one of just a handful of high-profile investors such as his mentor Radhakishan Damani whom Dalal Street looked to for navigation.
Jigar Shah, CEO of MIB Securities, a Mumbai-based stock brokerage firm, and who is also part of the capital markets business, says that if one examines Jhunjhunwala’s career, his real stock-picking skills were on full frontal display circa early 2000 when he picked outstanding winners like Titan, Crisil, and Lupin. It is not that he just picked them but he went in deep with large quantities and played what were then contrarian bets. “They were not in market favour at the time and later became monstrous multi-baggers and created a lot of wealth for him and his company RARE Enterprises,” Shah adds.
Jhunjhunwala’s company was a combination of his and wife Rekha’s initials and he is survived by her and their three children.
Jaydev Mody, chairman of Delta Corp. says that Jhunjhunwala not only served on his board for many years but also was a dear friend. What differentiated him from other investors? “He saw numbers completely to include the P&L and balance sheet but his grasp of business allowed him to see beyond just the numbers. He was able to do that across business sectors which was outstanding,” says Mody. “He would constantly read. He was always on top of what was happening with oil, the dollar, metals, and stocks. Everybody thinks he was a speculator but he was really an investor and would hold long term views for the ones he had faith in, and where he regarded and understood the management, and saw value in.”
Jhunjhunwala also moved very fast when he saw an opportunity. Karthikeyan Muthuswamy a Bengaluru-based independent investor who earlier worked with a hedge fund in New York, had first met him when he was a young analyst in Mumbai. His early wins, says Muthuswamy, which included Matrix Labs, and Bata amongst others represented opportunities which others did not catch onto. “There was deep value in all these stocks and a lot of funds - maybe 25 - struggled to understand whether they should jump in or not. But he moved fast and raced ahead,” he says. “You can be like Warren Buffet who is a deep value investor or like George Soros who is an exceptional trader but Jhunjhunwala was both which, no pun intended, like the name of his company, was RARE.”
The heavy set, portly Jhunjhunwala who sported a thin moustache, metal-rimmed glasses, and wore white shirts a lot, was also a regular on the Mahalaxmi race course and even owned a few horses. His larger-than-life lifestyle—he loved drinking, smoking, eating supari and partying-- and his sharp style of speaking made him a popular market guru, a fixture on the business channels which propelled him to nation-wide fame.
In recent years he assumed the status of the “statesman” for the markets and was more focused on how India was itself an asset class. Jigar Shah says that prognosis was true and has paid off and Indian markets are still resilient. “He had a memory that was elephantine and would never forget numbers, balance sheets and the details of anything he studied and researched,” Shah says, adding that people would sometimes say that he was trading but he wasn’t. Jhunjhunwala was simply testing markets and seeing where sentiment was going and he excelled at that.”
Marketing and brand consultant Suhel Seth says he hosted a dinner for his business friends last October where Jhunjunwala, amongst other business leaders, was in attendance. “He was in town to meet the Prime Minister but never once did he act like he was the star of the evening - and instead was asking the guests there what their take was on a host of different topics,” he says.
Last August Jigar Shah bumped into him socially and was with friends and family along with a young lady who had graduated from a certain university in Canada. They wanted to take a selfie with him and he agreed but then went on to quiz the lady about business in Canada, how things were developing there, what Canadians and she herself thought about the Indian economy, and so on. “His curiosity for knowledge no matter where it came from was fascinating,” he says.
While most stock-market barons are seen as ruthless capitalists, Jhunjhunwala also had a bleeding heart, say those who knew him. Muthuswamy says “He was very generous with his time and knowledge. Ask him how he made a certain decision, and he would never hold back on any of his trade secrets and in a sense was very generous and very kind. Also, Muthuswamy says he knows of several people who were down in the dumps whom Jhunjhunwala helped philanthropically. “There was a business side but it was balanced out by a generous humane side as well.” Jhunjhunwala was also an early donor to Ashoka University.
Despite his billions—his net worth, as per Forbes, was 5.8 billion dollars-- Jhunjhunwala retained the common touch with an earthy side. Seth recalls how he was once upgraded to a Villa at the Taj in Goa during an investor conference and was delighted. “Those little things excited him,” Seth says, adding that he was also a great romantic and would regularly write poems for his wife. “He was actually the big-hearted small picture man and not the big picture man.”