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Rakesh Jhunjhunwala is considered to be the greatest investor in Indian Market. He is supposed to have made Rs 5000 crores by just investing Rs 5000 in Indian Stock Market. Rakesh Jhunjhunwala guru mantra to be successful in stock market is as enumerated below:

(a) He advises people to become interested in a stock when none is interested in the same stock. As per him BUY RIGHT & HOLD TIGHT for years to come. He has been holding few stocks for last 10 years and he is still minting money from those stocks.

(b) He further advises that one should not follow big investors blindly as their risk profile and long term goals with time frame may be difficult to be followed by retail investor.

(c) Market is supreme and every thing is reflected in the price and thus their is no point in fighting the trend as market is always right.

(d) One should be able to create a balance between the fear and greed.

(e) As per his words one has to learn the stock market trading as none can teach the market as stock market experience is the best teacher.

Thus follow Rakesh Jhunjhunwala advice in stock market, BE PATIENT and grow big like Warren Buffet or this iconic man from Dalaal Street.

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Friday, November 14, 2008

Sensex to 50k points in 6 to 7 years, says Rakesh Jhunjhunwala

MUMBAI(In 2007):
Rakesh Jhunjhunwala is one of the market's Big Boys with a portfolio rumoured to be Rs5,000 crore.On the day the stock market crashed, he told DNA Money most Indians don't recognise the India story, and tried to explain why he remains extremely bullish.

On the participatory notes issue There was a day when we had to pledge our gold (to borrow foreign exchange, in 1990). Now we have to restrict foreign capital. Life has come a full circle.

Where will Sensex go next?
50,000 in 6-7 years if the current profit growth is sustained.

And GDP growth?
India will grow at 10% before 2010. I have a dinner table bet with TN Ninan, the editor of Business Standard, on this.

What about corporate profitability?
Stock valuations are slaves of earnings. Economic history tells us that earnings grow at 1.25-1.75 times GDP growth. Hence, I see the growth in corporate profitability over the next few years at 17-20%.

Which sectors are hot?
India-centric sectors such as telecom, banking and infrastructure will continue to remain hot. Stay away from IT because the current 30% margins cannot be maintained. Only monopolies can maintain 30% sustained margins.

What about real estate?
I don't invest in real estate. Real estate prices in fringes of cities will fall because the current prices are unsustainable. Education is a great business to be in, but I can't find the right investment. I am bullish and my faith is getting accentuated by every public appearance I make.

What about household money coming to markets?
In 1992, 17% of domestic savings went into the stock markets. In 2004, it fell to 1%. And I feel 15% of domestic savings will go into the stock market by 2011. So $45-50 billion of local money is what we are talking about.


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DISCLAIMER: The author is not a registered stockbroker nor a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity, index or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. The author recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and that you confirm the facts on your own before making important investment commitments.

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