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The stock market is on fire, it's not easy to earn money from this market, it's very exciting but remember it's not the race course. Then Madhu Dhanvate's budget came and I thought the budget would not be bad, so I invested Rs. 2.5-3 crores that I had in the 1989 budget and you don't believe me, whom should I tell?
Understand that day when the budget used to come in the evening, the market used to be open from 6:00 to 9:00, so at 6:00 my net worth was Rs. 3 crores and at 9:00 my net worth was Rs. 20 crores. The Big Bull Rakesh Jhunjhunwala: The story of Indian stock market will always remain incomplete without this name.
He started his trading career with just ₹5,000 and by the year 2026, his investment portfolio had built a wealth of ₹00 crores and the entire stock market gave him the tag of one of the greatest stock marketers of all time. The Big Bull. Rakesh Jhunjhunwala started trading in 1985 when Sensex was at 150 and we all know it the rest was history.
Why is Rakesh Jhunjhunwala successfully investing? Because patients have surely made him building. Man with the Midas Touch They Call Me. Rakesh Jhunjhunwala has an approach that just doesn't seem to fault. And you have the folk hero of Indian stock market. Because there are so many young people who take so much inspiration from Rakesh Jhunjhunwala.
Talking about the visor of the red street. The Bite Piper of the Indian Stock Market. Hello everyone, welcome to our new fresh episode. In today's episode, we will decode Rakesh Jhunjhunwala and his investing mindset mechanism and see which techniques, methods and investing theories he used to develop his investing wealth.
Well, if you watch this video completely, you will understand how to build an investing mindset mechanism that will help you in taking decisions in the stock market so that you will be able to see the stock market not just as trading, gambling and speculation but as the best option where you can create your wealth by investing in a valuable business.
So let 's decode the Big Bull Rakesh Jhunjhunwala Investing Mindset Mechanism. Rakesh Jinjanwala was a qualified Chartered Accountant and his CA learning provided him with a mental foundation that enabled him to develop business models, financial terms and critical analysis methods. With this, he was able to understand not just the financial numbers of the company but the story behind those financial numbers.
What could be the market sentiments which would give them a proper structure view point about the future growth of any company, the reason for its profit, which would help them in taking decisions not on emotional basis but on business mathematical basis. Rakesh Jhunjhunwala used to select such businesses and industries which existed in the past, exist in the present and will exist in the future also.
Rakesh Jhunjhunwala used to track such businesses which have maximum large base customers or that company or that business has maximum and popular brands of that industry which are very difficult to replace in the market. For example, health care industry, food consumption industry, energy sector, financial sector, meaning treatment cannot be done without medicines.
A human being cannot survive without food. And without electricity power, homes and offices cannot function. And the economy cannot function without banking and loan services. Keeping this in mind, Rakesh Jhunjhunwala invested in Jubiland Pharma in the pharma health care industry, Sun Drop Brands in food consumption and C Kera Bank and Federal Bank in the financial sectors.
Rakesh Jhunjhunwala has always been interested in such businesses and companies which have some extra advantage or some extra power in the market compared to their competitors. Meaning a company which has maximum share in the market and controls the market. Like the King Fisher brand which United Berries owns.
United Berries had a 50% market share in the 90s. Highlighting this very thing, Rakesh Jhunjhunwala invested in United Beverages. This gave them access to 50% of the beer and liquor market. And in 1995, Rakesh Jhunjhunwala invested ₹1 crore in United Babies which became ₹90 crore in 3 years. Straightforward 15x return.
Rakesh Jhunjhunuwala used to track mode and limited entry businesses. Such businesses and industries in which it is very difficult for any new player to enter. Companies that have an advantage in their market over their competitors. Such as market network, supply, specific license which does not allow any other competitor to enter the market due to which the company has monopoly in that business in the market.
Rakesh Jhunjhunwala gives the most importance to cash flow in any company and its business. Rakesh Bhaiya always taught us that a successful business is built on cash flow. And he always gave us the example of Titan that you want to leverage the cash you are generating and grow with it. Cash flow refers to how much money a company saves after doing business as a reserve, which helps in future growth and expansion.
I am making a business model a cash flow model and the variations have to follow right or pid lite may be asian paint may be ne may be titan right which have given return over generations at least two generations they are all valued between 30 and 35% cash flow I will explain this they are not they are not valued on the basis of the earnings they are valued on the basis of cash flow the pi may be but the ratio of cash flow is always three and half times the company which has maximum cash flow gives fixity to the business of the company the company can run the business without paying interest.
Can repay the loan as soon as possible. The company will not have to depend on the market for financial and funds to run the business. And one extra point, if the company has cash flow then it can distribute its cash flow to its investors as a dividend payout. Rakesh Jhanjwala did not just look at the rise or fall of stock prices.
He believed that if the stock price goes up, there will definitely be margin profit. But if the company has cash flow and if it distributes the cash flow as a dividend, then they will get double benefit from their one investment, the biggest example of which is Rakesh Jhunjhunwala's own investment in Danta NZ Technologies, Orient Cement.
At the time when Rakesh Jhunjhunwala invested in these companies, these companies had the highest cash flow at that time. No matter how good any business or any company is, if its leaders and its management do not have skills and quality, then even the best business or even the best company crashes.
Rakesh Jhunjhunwala used to go to the ground level of the company leaders and their management and verify their past records and their actions in business terms. As a personal human being, he used to take advice from people in the market about how people are. He used to highlight what people were saying about that person in the market.
Such as taking feedback from the company's suppliers and their customers. It clearly helped in understanding the words of the management and their action results. The biggest example of which is Rakesh Jhunjhunwala's investment Lupin. Lupin hired Dr. Kamal K. Sharma as a director. Talk More About Lupin is Dr.
Kamal Sharma, the Managing Director of the company who joined us in Mumbai today. Thank you so much for joining us. Thank you for having me. And at that time Lupin used to make only TB medicine. And on the other hand, D Kamal Sharma had very good expertise in biotechnology and bio science. He had a huge contribution in the success of KPG Group in the past and Rakesh Jhunjhunwala was highlighting this very thing.
He saw D Kamal Sharma changing the entire organization of Lupin. Investing in new technology of medicine. We are diversifying towards new pharmaceutical products. The direct result of which started showing on the company's business revenue. Due to which the company's loan debt started decreasing and market share started increasing and Lupin also started acquiring new companies in the market.
Rakesh Jhunjhunwala also instilled leadership qualities in Lupin and from 2004 to 2024, his Lupin investment grew 88 times. Rakesh Jhunjhunwala considered the promoter's holding in any company to be 51% or more. The reason for this is very simple mathematically and psychologically. If the promoter has maximum shares in the company then he will consider the company and its business as his own and he will carry out all the actions and calls of the company as a responsibility.
He will take care of even the smallest areas of the company's business due to which the company gets an internal push for its growth. Because if I am a shareholder and the shareholder bigger than me is a promoter and ultimately he is on his journey of wealth creation, then the less dilution there is in it, the better it is.
So friend, why should I take your share next time? Because after six months you are the one who will come and give it to me. So, where there is constant dilution in any company, wealth creation cannot happen there. Wherever big investors are investing, they consider such companies more and more. Like mutual funds, HAI, J funds where the participation of retail investors is very low.
If big institutional mutual funds invest in any company, then a trust is directly visible there because institutions and mutual funds always invest in any company after doing complete research. And on the other hand, having minimum number of retail investors becomes very beneficial for the company and its stock price.
Because retail investors take entry and exit as the stock price goes up or down. Due to which the price of the stock does not remain stable. But where big institutions invest, there are chances of the stock price becoming stable. And there is also a big advantage of the institution investing in that company that big investors and big players externally help that company and business a lot in growing.
Like providing network to the company for business, giving some suggestion idea due to which big players contribute to the growth of the company through external factors. Rakesh Jhunjhunwala used to analyze future market growth demand. He understood where and how the market demand could be in the future and also tracked what action plans the company was taking to meet that future demand.
And this happened exactly when Rakesh invested in Lupin. At that time, Lupin was investing in RAD and new medicine development and one of the stocks due to which Rakesh Jhunjhunwala became most famous and that stock generated maximum wealth for him was Titan. Rakesh Jhunjhunwala noticed that Titan is making structural changes within the organization to meet future demand.
At that time, Titan was hiring people with new talented mindset as per the new market demand. And on the other hand, at that time, the Indian jewellery market was 80 to 90% unorganised. Seeing this market gap, Titan entered the market as a junior organised player, which was fulfilling the future demand of the jewellery market and Titan already had a huge access to historical financial and network, due to which it did not take much time for them to expand Tanish and Tanish stores were opened in maximum cities of India at a very fast speed and seeing this opportunity, Rakesh Jhunjhunwala bought 5 lakh shares of Titan in 2003.
At a rate of ₹30 and going into the future, as the company's revenue and performance improved, Rakesh gradually increased his stake and today, after his departure in 2026, the value of his Titan shares has reached Rs 20,000 crore. Would I have invested in Titan if I didn't feel that the jewellery market in India?
We go you know from 5% branded to 20% branded. And in five years if ₹1 lakh crore is going to be the branded market jewellery market in India the branded market will go from 5000 crore to 20000 crore so it is a 15000 crore opportunity so you know nobody can grow bigger than the opportunity any investment any business is not successful unless it is bought at a price lower than its worth.
If we look from the viewpoint of Rakesh Jhunjhunwala, he used to say that it is very important to invest in a good company and a good business. But more important than that is at what time and at what price we are investing in that company, that business. What is value? Is there anybody in the world who can say stock is good at 12 times earnings and not good at 20 times earnings.
Isn't it good at 12 from the US? I will say it's good at 20? So how do you discover the value? The Stock Market Will Always Make Access. Your opportunity line is recognizing the risks and finally the value will come to mean. Well, there is no specific formula to calculate the price and value of any stock.
Because the value and price of every thing can be more or less for every person. Because it works differently for every person. This is the stock market. Paper flowers cannot smell. Right? So don't be surprised. Its value has become so much that Zomato's has become ₹1400 but we will see after 5 years but there are some such ratios of financials which Rakesh Jajwala has shared like the PE of any company should be less than its competition and its industry, the basic meaning of BE is Price to Earning Ratio which tells that how much price we are paying for that company to earn ₹1 from that business.
There are many other ratios that help define the story of a company by determining its price and value based on its financial performance. Lot of people ask me how do you choose an investment? You know the most difficult adjectives in the English language are beauty a girl and value in a stock? It differs so much from the holder.
Right? So, how do you find value in a stock? Because for every buyer there is a seller? Some like Nandita Singh, some like Sushmita Sen, some like Aishwarya Rai. So you know beauty as is own concept yaar. So it's so difficult. So and you know when I go to buy a stock someone is selling it. So there for that person feel there it value in that stock.
So how do you choose a stock? So see the basic thing I will tell you when investing in a stock think of the business model of that company. I am doing investing, I am not doing trading. Think Momentum in Trading. Here You Think When You Invest Think of Business Model. Right? And I think the first thing I look at when investing in a company is the opportunity.
But if we look at practical life and real examples, sometimes the stock price and the financial performance of the stock present different stories. Because sometimes the stock market rewards futuristic demand and value either very late or very early and the same thing happened in the case of Titan when Titan investors were leaving the company.
Because at that time there were issues going on between the management of Titan and the workers of Titan and problems had started arising in the operational process of the company. But Rakesh Jhunjhunwala looked at this problem from a short term view point at that time because Rakesh Jhunjhunwala, after looking at the historical performance and futuristic demand of Titan, tracked the action plan of Titan's management team, which I have already told you - changes in the organization, hiring new talent, entering the new jewellery market, but on the other hand, Rakesh Jhunjhunwala looked at Titan from a long term view point, he saw that in 2003, Titan's revenue was increasing but its profit was not increasing and after that the same time came when Titan's stock crashed by more than 45% in the market.
Rakesh Jhunjhunwala invested in Titan at a PE of 1 and a rate of ₹30. Rakesh Jhunjhunwala was confident about his investment because he had done ground level research on Titan. That 's why he saw a multibagger value research in Titan. Using this investing method and mechanism, Rakesh Jhunjhunwala cracked the stock market and by the year 2022, he left this world taking with him the biggest tag of the stock market, The Big Bull.
I am going to say, what will I say to the day God kills me? God, please wait. I will say now that I wake up at 7:00. I do a little yoga. After that I smoke a cigarette , drink tea and have breakfast. Then go to the stock market and invest quickly. Right? Then at 4:00 or 2:00, Utpal will say, look brother, there has been a lot of dynamic change here.
If you take this company then I will invest a little in that company. Then at 7:00 I'll go and have three or four drinks at Jeffrey's. Well, I will eat first class food at home. Then I will tell God to take me right now. But even today, traders and investors in the market decode his old interviews and his action plans.
So that people can get value learning. Well, tell me how you liked this episode of Investing Mindset Mechanism by commenting and for more such future business and value decoding concepts, you should subscribe to this channel. tick
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