What Rakesh Jhunjhunwala said on how to generate long-term wealth

Ace stock market investor Rakesh Jhunjhunwala, often referred to as India's Warren Buffett, died on 14 August. A self-made trader, investor and businessman, he was also known as 'Big Bull' of Dalal Street. 

As a qualified CA and son to an Income Tax officer, Jhunjhunwala had entered the stock market in 1985 when Sensex was at 150 points with just ₹5000. The journey which began with ₹5,000 and today he has left this world leaving $5.8 billion wealth (according to Forbes data) for his family.

Even after his death, he has left behind his legacy of investment principles that would continue to motivate stock market investors to grow wealth from stock markets.

In an interview with Times Network India Economic Conclave 2021, Rakesh Jhunjhunwala was asked about his advice for the young budding entrepreneurs on consistent wealth creation from large wealth creation.

To which, he listed down the basic principles. “The first being that you got to be in the industry which is growing at large opportunity, second is corporate governance,” he said.

“Because corporate governance is a very wide world. It includes attitude towards society, towards customers, towards employees, towards stakeholders, sharing fair leap, not taking undue risk,” he added.

"The third principle is technology and the ability to change; fourth is there has to be frugality, giving example, he said, I give IndiGo and Dmart as extreme companies who use frugality."

Also Read: Rakesh Jhunjhunwala's 10 investment principles that made him Big Bull of Dalal Street

He further added that, “Companies which are patient, you know if the race is not going to get finished tomorrow, then I always think that tortoise wins at the end. So growth is a process, don't try to side step it. So for long term return this are the basic principles.

Also Read: Rakesh Jhunjhunwala started his journey with a capital of just ₹5000; all you need to know about India's Warren Buffet

“I think recognised change and a lot of large companies can grow big. I feel entrepreneur don't want to give up the power,” he added.

He concluded at the end saying that “Companies where you delegate are the only companies which can scale.”

Rakesh Jhunjhunwala ruled the Indian stock market for decades, making intelligent investment choices to build an empire of stock holdings worth over ₹40,000 crore. He was India's 36th richest person.

The 62-year-old's entry into the capital-intensive sector raised eyebrows earlier this year, with many pointing to the chequered history of billionaire-backed airlines in India as well as the daunting global economic outlook. Jhunjhunwala had invested $35 million for an estimated 40 percent stake in the new airline. "A lot of people question why I've started an airline. Rather than answer them, I say, I'm prepared for failure," the billionaire had said.