RJ’s first purchase of Titan was made by chance, from a stroke of good luck, but later additions was stuff of legend: Ramesh Damani

Obsession about trading, extra-ordinary focus, ability to take large-sized bets, and take losses in his stride differentiated Rakesh Jhunjhunwala from other investors, said Damani.

Rakesh Jhunjhunwala’s most talked-about bet, on Titan at Rs 40 in 2003, was made by chance, according to Ramesh Damani.
It wasn’t placed based on extensive research or any tip-off, as is largely believed, he said in an interview given to N Mahalakshmi about Jhunjhunwala, the investor and the person.

Also watch: Ramesh Damani looks back on the journey of Rakesh Jhunjhunwala

Titan’s stock has since grown nearly 62x to Rs 2,470.

Many a time, Jhunjhunwala’s approach was to invest, then investigate, then when he was convinced, add to the position, said Damani, adding that adding to a position at higher prices is an extraordinarily hard thing to do.

Damani, the celebrated value investor was a long-time friend of Jhunjhunwala, and has known the Big Bull since his early days in the stock market. They remained friends for over three decades.

“In 2003, his broker called him and said that he had some 10 lakh shares of Titan that someone wanted to sell. ‘If you buy 10 lakh of them, the price is 40. If you buy 30 lakh, the price will be 38, and if you buy 50 lakhs, the price will be 36’. He understood that at Rs 40, the market cap would come to around Rs 300 crore, with its great brand name, it was probably worth a lot more,” recalled Damani.
He decided to take a dab at it and bought the smallest lot, and then he started following the company.

“Over the next few years, he kept adding to his position and bought almost 5% of the company,” said Damani.

“There is this folklore that he bought Titan after studying it or after accessing some insider information, but that’s probably untrue. He bought it because his broker had a lot and he came to Rakesh before going to anyone else,” he added.

“Sometimes, truth is stranger than fiction,” he said.

While Titan might have come as a stroke of luck, to make the call when an opportunity is presented to you is far from easier. It is harder still to keep adding money to increase the position at higher prices.

“It is extraordinarily hard. I do that (adding position at higher prices) sometimes and generally get mud on my face. It is so hard because right at the moment we have the highest level of conviction, the stock tends to peak out and go down,” said Damani.

Obsession about trading, extra-ordinary focus, ability to take large-sized bets, and take losses in his stride differentiated Jhunjhunwala from other investors. “That (taking supersized bets) is still a work in progress for me. I had a number of those (super multi-baggers) in my portfolio but I am too caught up in middle-class (mindset) to be able to take those calls and risk the loss,” Damani said.

Jhunjhunwala wasn’t immune to the ego-bruising that comes after taking a wrong bet. But, he could take it quickly in his stride. “His attitude is best defined by the Bollywood song Main har fikar ko dhuen mein udata chala gaya,” said his friend.Also read: RJ: The king is dead, long live the king

He shared a story about Jhunjhunwala’s unwavering, 24x7 focus on trading. Once when Jhunjhunwala and the entire group of friends were in Macau, they went gambling till 2.30 in the morning. The, despite the time difference, Rakesh caught up on sleep for two hours and was up to get back to markets as Tata Motors was announcing its results that day. “Whether he was in the hospital, wheel-chair or investigation room, he was hooked to the market,” said Damani.

He got high on the adrenalin. While it resulted in his oversized success, it led him to neglect his health. “As friends, we all feel bad about his missing out on the fall of life, when you look forward to your children getting married, to retirement and spending time with your grandchildren… what greater joy is there than that,” Damani said in a poignant mood.