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An 18-year-old boy, who had heard his father and his friends talking about the share market since childhood, dreams of making a career in the world of investing one day, but his father refuses to give him money. Then he breaks his piggy bank and invests his entire savings, which will reach just over ₹5000000 and he will also be known as India's Biggest Bull.
I am talking about Sir Rakesh Jhunjhunwala and today, along with his success story, we will learn about his three such wealth creation rules which can change your life too. So, do watch the full video. What do they say? The one who speaks in the boom is the black mark in the recession. Rakesh Jhunjhunwala was born on 5 July 1960 in a Marwari family living in Hyderabad.
His father Radheshyam Jhunjhunwala was an Income Tax Officer. In such a situation, whenever his friends or colleagues used to come to his house for dinner, everyone used to talk about the stock market and investing, seeing which Rakesh's interest in shares was there since childhood. Rakesh's interest in the market was awakened.
As he grew older, he began studying the stock market himself. One day, he went to his father and said, " I want to make a future in the stock market." His father taught him the most important lesson of life, saying, "Son, never invest with money from me, from your friends, or from borrowed money. Treat yourself to what you earn.
Invest with your own earnings. Don't invest with your father-in-law's or your father's money." Therefore, throughout his career, Rakesh Jhunjhunwala never opened an investment firm; instead, he traded and invested with his own money. He started with just ₹000 of his life savings, which he turned into ₹45,000 crore.
Radheshyam also told Rakesh, "Son, before entering this field, you must earn a degree so you always have a second option." In 1958, Rakesh completed his Chartered Accountancy studies. During his college days, Rakesh made several small trades and increased his wealth from ₹ 100 to nearly ₹100 lakh. He took his fortune to 10,000, and then he took a do- or-die bet by investing his entire money on one share.
But before investing, Rakesh did deep research on that company for several months and that company was Tati. Rakesh Jhunjhunwala bought 5000 shares of Tati at a price of ₹1.43, which reached ₹1.43 in just three months, giving Rakesh Jhunjhunwala his first big profit of ₹1 lakh, but at that time he had neither any godfather in the share market nor capital worth crores.
In such a situation, his journey for the next few years was full of difficulties and to earn big profits, he started taking risks. The first big risk of Rakesh Jhunjhunwala's life was his investment in Sesa Guwa Company in 1986, which we also know today as Vedanta Limited. By that time, there was a huge fall in the prices of the company's main product, i.e., iron ore, due to which the company was going into loss and all the investors were withdrawing their money, but Rakesh Jhunjhunwala was forced to take the risk of the company.
He had complete confidence in the performance of the financials and the metrics of the iron ore industry, so he purchased 400,000 shares of Sesa Goa, valued at ₹1 crore. This risky bet was equivalent to Rakesh Jhunjhunwala 's entire capital, meaning if Sesa Goa had collapsed, it would have taken Rakesh with it.
However, the company bounced back, earning him substantial profits. Over the next nine years, Rakesh Jhunjhunwala made a significant amount of money from the stock market. Then came 1989, when VP Singh became the Prime Minister, and the market was abuzz with rumors that the new government's budget would be public-friendly rather than business-friendly.
This meant that businesses would be subject to numerous taxes and the entire proceeds would be used for public welfare schemes. Panic gripped more than 50% of investors, leading to a significant market crash. However, Rakesh Jhunjhunwala invested his entire capital in the falling market, meaning that if things had changed even slightly, Rakesh would have been left on the streets.
But luck favored him, and the government's budget It turned out to be business-friendly, which led to a rapid market boom, and Rakesh Jhunjhunwala's wealth nearly doubled. However, over the next 30 years, Rakesh Jhunjhunwala's portfolio experienced significant ups and downs, and some of his investments failed.
However, thanks to his powerful foundation, he continued to grow. When he left this world on August 14, 2022, his net worth had reached ₹5,000 crore. What did Rakesh Jhunjhunwala, known as the "Biggest Bull of India," do that ensured his wealth continued to grow, whether it was the liberalization policy of 1992, the recession of 2008, or political tensions in the market due to the change of governments.
Prashant Desai, who worked with him, explains some of Rakesh Jhunjhunwala's wealth creation rules. Number one: Decades of compounding. When we all buy any stock, as soon as it makes a profit at 10 to 20 points, we feel the urge to exit and book profits. It arises but Rakesh Jhunjhunwala believed in long term investing, hence despite the ups and downs in the market, if the company was powerful then he did not exit, the biggest example of which is Titan.
Rakesh Jhunjhunwala invested in Titan for the first time in the early 1990s, when Titan only made watches, but then in 1996 when Titan entered the jewellery market and launched Tanishq, Rakesh Jhunjhunwala invested in the company again, after which he bought Titan shares in 2004 at a face value of ₹ 440 and he continued to invest in Titan and you will be surprised to know that he never withdrew money from his main investment in Titan and today the value of his investment in Titan alone is 1.5 billion dollars.
Number two: Invest in cash flow business. From the very beginning, Rakesh Jhunjhunwala used to invest in cash flow businesses because he believed that if a company is struggling to manage its cash flow and every 6 months the company's If dilution is taking place, wealth will never be created there. When people discussed his philosophy and cited examples of unicorn startups that started from zero, where investors' money had multiplied 50 to 100 times, he would say that it's not wrong to bet on a weak horse, but I don't do that.
When I have to, I do it on a very high scale so that no big company can swallow that startup. Number three: Market study is important. Prashant Desai explains, "When I worked with Rakesh Jhunjhunwala, we had a team of eight people, and Rakesh alone did more research than the eight of us together did in a day.
He would spend hours reading company balance sheets and small macro updates. Even when Rakesh Jhunjhunwala was trading, he would n't trade Nifty or Bank Nifty futures and options based on a two- or three-day forecast; instead, he would often trade 3-4 months ahead. Now, imagine him trading Nifty 50.
If he had to take a call, he used to read not only the index but also the balance sheets of all the 50 companies of Nifty 50. Friends, overall Rakesh Jhunjhunwala was always positive about the future of India, that is why he was called India's biggest bull. Well friends, can money be earned from the share market?
If yes, then what qualities are required for this? Do share your experience on this point with other viewers in the comment box. If you liked this story, then do like and share the video. To keep watching such interesting videos, do subscribe to this channel and press the bell icon. Thank you.
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