Wednesday, June 13, 2007

Rakesh Jhunjhunwala's Quotes

Rakesh Jhunjhunwala is one of the leading equity investor of the country. I find he always gives some or the other thing in his interviews, which will make your understanding of the financial world a lot better than that was before reading the interview.
Here are some of his comments which I liked recently.
  • one of my biggest learning as an investor is that good stocks always remain expensive.
  • Investment strategy: If you find an idea that you are convinced of take a position which if proved correct makes a meaningful difference to your Balance Sheet.
  • Do you think analysts know what value and valuations are? They would be the richest people in the world.
  • When I bought Praj, it was very difficult decision because in January of 2003 the price was Rs 10; I bought the stock at Rs 100 in December 2003. So the stock had appreciated 10 times in a period of one year before I bought the stock. So, I don’t know; stock appreciated 10 times is a vast appreciation and I bought after that. So I am not buying anything to be different. I am only buying it if in my thinking, the earnings will grow and valuations are reasonable.
  • The other lesson is that do not expect that you will have this kind of return constantly. Some of the worst mistakes are made when you get an abnormal return and then you start feeling that you must take steps so that this return can be replicated.

On the face of it, they look very common sensical, but it is this common sense that we loose completely when we make major decisions, I feel. And that's why perhaps he emphasizes so much on these.


Anonymous said...

Indeed RJ's sayings are worth emulating. Hope, we as investors do keep these words in our mind and soul. The problem is everyone sees RJ's magnanimous portfolio and hopes to be like him. But no one wants to wait for 20 long years. Patience, conviction and of course the very uncommon Common Sense is required for any investor to have continuous good returns.

---Nitish Kumar

Anonymous said...

Nitish u have progressed really very fast in this field, I must say :-), by heart!