Rakesh Jhunjhunwala's net worth jumps to Rs 13,600 cr in 2-day rally

The sharp upsurge in the markets where benchmark Sensex zoomed nearly 3,000 points in the last couple of sessions boosted the net worth of ace investor Rakesh Jhunjhunwala, which increased by over Rs 1,500 crore to Rs 13,600 crore. Jhunjhunwala's investments span across 32 listed entities where his holding is over 1%. Titan Company, Agro Tech Foods, Crisil, Escorts, VIP Industries contributed to the wealth addition.

After the finance minister Nirmala Sitharaman announced a slew of measures, including a reduction in corporate tax, on Friday, Sensex soared 1921.15 points to a decade-high. On Monday, too, the equity market remained buoyant as it jumped 1075.41 points, with Sensex witnessing a combined increase of 2996.56 points.

The rally witnessed a sharp increase in the net worth of Jhunjhunwala, which was around Rs 12,092 crore on September 19. The net worth rose to Rs 13,094 crore on September 20, and subsequently to Rs 13,601 crore on September 23.

Most of the gains came on the back of stocks such as Agro Tech Foods, Crisil, Delta Corp, Edelweiss Financial Services, Escorts, Federal Bank, NCC, Titan Company and VIP Industries which also witnessed a sharp rise in their share prices during the rally.

However, the market ended flat on Tuesday, and the benchmark indices witnessed a sharp drop of over 1.25% on Wednesday, taking Jhunjhunwala and his family's net worth down by nearly Rs 426 crore to Rs 13,175 crore, based on the market prices on BSE on Wednesday.

The data comprises of Jhunjhunwala and his family's holdings in companies where it is more than one percent for the quarter ended June 2019.

According to an analyst, ace investors like Jhunjhunwala and others have remained invested for a very long duration, and everyday market movements do not impact their appetite for long-term investments.

"These investors could find potential stocks at attractive rates, which help them create a lot of wealth over a long-term duration than trading on an intra-day basis," the analyst with a foreign brokerage said on condition of anonymity.

On Wednesday, political uncertainty in the US and signal of an Asia-wide slowdown from the Asian Development Bank weighed on the domestic equity market. The S&P Sensex lost 503.62 points, or 1.29% to close at 38593.52, whereas NSE Nifty 50 closed 148 points, or 1.28% lower at 11440.20.

Among the 30-stock Sensex on Wednesday, only six closed in green, such as Power Grid Corporation, Tata Consultancy Services, NTPC, HCL Technologies, Tech Mahindra, and Reliance Industries, gaining up to 4.39%. On the flip side, major losers were State Bank of India, Tata Motors, Maruti Suzuki India, YES Bank, Mahindra & Mahindra, and HDFC, losing up 7.37%.

Among the sectoral stocks, all ended in red, except Nifty IT which gained marginally 0.27%. The pack of losers was led by Nifty PSU Bank (5.63%), followed by Nifty Auto (3.9%), and Nifty Realty (3.06%).

Sahaj Agarwal, head of derivatives, Kotak Securities, said, "After a strong recovery seen in the previous week, some profit booking/consolidation is seen in the broader markets. We believe 11700 is a stiff resistance for Nifty50 and cross of the same will trigger the next round of momentum up-move. The immediate range for the index is seen at 11250-11700. Expect range-bound movement in the near term which should be followed by an upside breakout in the October series. IT stocks gained as the rupee weakened while PSU banking space remained under pressure."