‘It’ll be Biggest Bull Market In My Lifetime’
Rakesh Jhunjhunwala spoke to Nikunj Dalmia and Ayesha Faridi. Edited excerpts: ND: What’s your first reaction to today’s (Friday’s) mandate? Do you think a new bull market or a Modi bull market has started now? Let us examine the market later, let’s examine what it means for India first. It is the first time in the history of independent India that a non-Congress party has got a majority in the Lok Sabha. This by itself is a historical event for India. Second, it is an indication of the maturity of Indian democracy. The BJP has performed well in seats in which Muslims have got very large voting in Uttar Pradesh. This indicates people are not voting on caste and religion, people are voting for their aspiration, for development, for good infrastructure. These two things are a very big milestone in the economic development of India. ND: Modi is the new CEO on the saddle. Do you think he will be able to deliver because the problems for India are rather deep-rooted? First of all, there has been a management change in India and I have full confidence in the new management. I had full confidence in the management of Titan when nobody knew them and by god’s grace, I was proved right... History has shown us time and again there are people who can handle different situations, near-impossible situations, and change things around, and with Indian potentiality and with Modi’s tactical thinking and his ability to carry people with him, this is something which we Indians will not realise what has happened. We will realise five years later. ND: Has a new bull market started? Well, you have any doubts? ND: I am asking you... Well the Nifty is 1000 points higher from its previous highs, a high it held for five years. I don’t know why people should doubt it. Quality stocks are gaining, the number of new highs against number of new lows is some 50 to one, good quality stocks are going to new highs. Markets are going up. Do not forget that bull markets will go up on a wall of worry. All I see is worry, people are not participating, but how long will they not participate? I have no doubts that we have started the biggest bull market that at least I will see
in my lifetime. ND: In a bull market, the index normally doubles. Do you see that kind of a price action in 3-5 years? The index will surely double and treble. The question is how many times and in what time. If the index doubles in five years from now, it will be very poor gain actually. I see it happening much faster. AF: Much faster meaning within this year or do you think it will be a wait of two to three years? I think earnings growth will expand may be next year... from 15% to 18% to 20% as economic growth in India expands and better policy and investment come through. AF: Will 7000 (for Nifty) stay intact or could we go back to 6500 levels? I don’t see Nifty going below 7000 and I reserve the right to be wrong. ND: Every bull market has a new hero. You famously said courses remain the same, horses they change. Where are the new horses going to emerge from? I do not know. Let each investor choose whatever horse he wants. There is a buffet, there are a lot of dishes, eat what you want but do not overeat, Ultimately all sectors or market are going to gain. ND: What is Rakesh Jhunjhunwala’s message to an average investor? Believe in India and invest in India, (have) faith in god, prosper in India. ND: Last time when I met you, you said you see a lot of conviction in old economy stocks. Your purchases like Prakash Industries or Orient Cement, looks like you are buying economy-related stocks. Well, I am more into everything. I do not want to go into specifics. ND: Your big call is the index should double in 3-4 years. The index will double in three (years)… I mean, from 6300, I see the index doubling in three years. I will be disappointed if, in three years, we have Nifty below 12500.