Was Rakesh Jhunjhunwala India’s last stock market billionaire?

It's tough to become a billionaire but nearly impossible if you want to take the Dalal Street route to riches as the late Rakesh Jhunjhunwala did by starting with just Rs 5,000 and a CA degree in his pocket.

While a small motley group of traders and investors have become crorepatis in the last few years, hardly any of them have been able to make it to that elusive billionaires club solely on the basis of their investments in the stock market. And now, as the markets are becoming more and more efficient worldwide with the free flow of information and the shifting of high-risk capital to the startup ecosystem, the business of investing is also evolving, and a part of it is shifting to the private market.

Fondly known as the ‘Big Bull’, Jhunjhunwala was the biggest individual investor on Dalal Street and left a wealth of around $5.8 billion or Rs 46,000 crore. Although his close friend and investor Radhakishan Damani made more money than him of over $22 billion, most of his riches are because of Avenue Supermarts or DMart, where Damani is a promoter.

Other big individual investors on Dalal Street include the likes of Mukul Agrawal, Ashish Dhawan (who is also a private equity investor), Ashish Kacholia and Anil Kumar Goel. None of them are, however, billionaires, Trendlyne data shows.

“With just investing, it is almost impossible to become a billionaire today because there is so little inefficiency in the system, and everyone is factoring in all the news almost instantly,” opines Zerodha Founder and CEO Nithin Kamath.

The other problem today is that by the time a company lists on the stock exchanges, they are already juiced out by private equity investors who have valued it more than whatever the company can do in the next 5-10 years. This is in sharp contrast to the initial history of India Inc, when companies used debt or internal resources to grow before launching their IPOs. Some such minnows of their time, like HDFC Bank and Infosys, who hardly had any PE or VC funds chasing them, are now bluechips and have given multibagger returns in the long run.

“It is very tough to be a public market investor and be able to make the kind of wealth Jhunjhunwala did, but in the private space, it is still possible because you can be early in some of these companies,” Kamath says.

Jhunjhunwala, who minted a fortune with stocks like Titan, Sesa Goa (now Vedanta), CRISIL and Lupin, himself had realised it as he had been betting big in the unlisted space in the last few years.

Recently-listed companies like Nazara Technologies, Barbeque Nation, Metro Brands, and Star Health were all picked by him well before their IPOs.

While there are many bulls on Dalal Street, Jhunjhunwala might turn out to be India’s last ‘Big Bull’ and even the last stock market billionaire.