Published By: Sayan Paul

Rakesh Jhunjhunwala's Birth Anniversary: The Fortune Formula - Investing Wisdom from India's Stock Market Legend

At the time of his death, Jhunjhunwala had an estimated net worth of US$5.8 billion.

In 1985, a young Rakesh Jhunjhunwala entered the stock market with Rs 5,000, his hard-earned savings. Now, Rs 5,000 back then was serious money. And yes, he had a head start because his father knew the stock market inside out. But does that fully explain what followed? Not even close. Within a year, he turned that Rs 5,000 into Rs 5 lakh. That’s a 100x return. By the end of the third year, his profit was touching Rs 25 lakh. And mind you, this wasn’t the age of social media trading gurus or 7-day stock market crash courses. Many get a head start, but only a few know what to do with it. Jhunjhunwala didn’t invest his money; rather, he invested wisdom. And that made all the difference. At the time of his death, his net worth stood at $5.8 billion, ranking him among the richest in the world.

So, what was his secret? What was the ‘fortune formula’ that turned an ordinary young man into India’s Big Bull? On the stock market legend's birth anniversary, let's revisit the lessons, mindset, and magic that defined Rakesh Jhunjhunwala.

Buy When Others Sell

“Always go against the tide. Buy when others are selling and sell when others are buying,” Jhunjhunwala famously said this in an interview, and he lived by it throughout his career. His investment in Sesa Goa is a textbook example of this mindset. While the market panicked over crashing iron ore prices, he bought 4 lakh shares at around Rs 25-28. The stock eventually soared to Rs 2,200, earning him massive returns. But this wasn’t a one-off move, as he consistently spotted value in despair, like during the 2008 financial crisis, when most were dumping stocks and he chose to hold onto CRISIL. His philosophy was "fear creates opportunity". While the world is driven by sentiment, Jhunjhunwala had the courage to stay rational.

(Credit: Pilot Investor)

Patience is The Art of Sitting Tight

If there was a single trait that defined Jhunjhunwala's investing journey, it was patience. “Buy right and sit tight,” he advised in several of his interviews, and nowhere is that more evident than in his Titan investment. Back in 2002-03, when Titan was a relatively unknown company trading at Rs 3-4 per share, Jhunjhunwala began accumulating it. Even through years of market turbulence, including the global recession of 2008, he didn’t flinch. By 2012, he held over 10% of the company, and by 2022, Titan was trading above Rs 2,000, turning his stake into a multi-thousand-crore asset. What made him hold on? It wasn’t really blind optimism, but deep conviction in the company’s leadership and potential. For him, patience was strategic endurance, something many investors today struggle with.

(Credit: Investment Books (Dhaval))

Consistency is the Backbone of Success

“You do not succeed without obsession,” Jhunjhunwala said, and his obsession with markets was lifelong. From his college days, Rakesh would sit for hours, studying financial statements, tracking trends, and learning the market’s rhythm. That obsession paid off early with Tata Tea, where he bought 5,000 shares at Rs 43 in 1985 and sold them at Rs 143 within three months, earning Rs 5 lakh and kickstarting his journey. But what’s more impressive is the consistency he maintained for nearly four decades. Through market scams, crashes, and corrections, he never strayed from his discipline. His firm, RARE Enterprises, was built on a dual engine: short-term trading for capital and long-term investing for wealth. Success didn’t come from one big bet; it came from showing up every single day with the same hunger to learn and improve.

(Credit: Tat Capital)

Fundamental Analysis is the Bedrock of Wealth

To Jhunjhunwala, numbers were just the beginning. “A balance sheet shows more but hides what is vital,” he said, underlining that understanding a business goes far beyond surface-level metrics. His investment in Lupin was a masterstroke, as he saw the company’s global ambitions early and bet big when others hesitated. Similarly, his stake in CRISIL grew from 10,000 shares to over 5.5 million, thanks to his conviction in its potential. What made him different was his approach; he dove deep into management quality, industry shifts, cash flow strength, and scalability. His legacy teaches us that true investing is about understanding the soul of a business, not just its price chart.

(Credit: Investment Books (Dhaval))

Risk-Taking with Responsibility

“Prepare for losses. Losses are a part and parcel of a stock market investor’s life,” he often reminded. And this goes without saying, Jhunjhunwala wasn’t afraid of taking bold risks. His investment in Akasa Air, launched in 2022, was one such example. While many questioned his move into aviation (a notoriously difficult sector), he invested $400 million for a 40% stake. Fast forward to 2024, Akasa was flying 24 aircraft across 19 Indian cities. But not all bets paid off. His investments in Dewan Housing Finance and Mandhana Retail went south. Still, he never shied away from owning his losses. His strategy was clear: diversify enough to absorb shocks, but bet big when the story is strong. Risk, to him, was something to manage and not fear.

(Credit: Akasa Air)

Belief in India’s Growth Story

Perhaps the biggest pillar of his investing philosophy was his unshakeable belief in India. “The future never looked so good; so what could go wrong?” he once said. He believed that India’s rising middle class, digital push, and economic reforms would drive decades of growth, and he positioned his portfolio accordingly. From infrastructure plays like NCC to new-age tech bets like Nazara Technologies, he aligned his investments with India’s transformation story. His optimism was data-backed. With India’s GDP projected to grow at 6–7% annually, his confidence in sectors like fintech, consumer spending, and renewables feels more relevant than ever. For modern investors, this is a reminder: macro matters. Back the bigger story, and your portfolio will grow with it.

Investment is a mindset. As the Big Bull once said, “Don’t talk about bulls and bears, talk about upswings and downswings.” Because in the end, markets will swing. But wisdom, like his, stays steady.