The trader-investor who passed away on Sunday at the age of 62 remained optimistic about the India story through thick and thin. He'd often say: When one has a big idea, one needs to bet big
Rakesh Jhunjhunwala passed away on August 14, 2022, in Mumbai.
Image: Mexy Xavier
Every time I met Rakesh Jhunjhunwala, he was unfailingly polite, patient with answering questions and consistent with his view on India. ‘Our best days are ahead of us’—was the line he never stopped repeating.
He followed the same philosophy while investing in businesses that went on to become market leaders. But unlike some of his contemporaries who define themselves as value investors, momentum investors, traders and the like, he refused to straightjacket himself. A question on his investing philosophy would prompt scorn. “I am too young to have a philosophy. I remain open to changing my mind,” he once told me. He described himself as a trader-investor.
At a time when the growing class of Indian retail investors has several heroes to look up to, Jhunjhunwala, 62, retained probably the tallest stature among them. Here was an ordinary middle-class child (his father worked for the income tax department) who came to the market in 1985 with a princely sum Rs5,000 and turned it into the greatest fortune (Rs41,800 crore) in Indian investing history. At last count in October 2021, his net wealth was $5.5 billion.
Jhunjhunwala had done this by investing in Indian companies that went on to become market leaders. Some like Titan he’d held for decades turning a Rs20 stock into Rs6,000 (he only spoke about the stock price before the several splits and bonus issues the company announced over the last two decades). His opportunistic bets spanned everything from sugar to metals and infrastructure to real estate. It was these (and the sensible use of leverage) that brought him the capital to make large bets in his later years.
It was this combination that proved to be truly special. The world over, few investors have been able to combine short-term trades with the big audacious long-term bets that bring in outsize returns. The best trades are often made in small quantities that are not enough to move the needle or are exited too early.