The stock market has suffered a major setback on Sunday. The blow is so great that it can hardly be compensated. A day before the country’s Independence Day, the country’s veteran investor Rakesh Jhunjhunwala(Rakesh Jhunjhunwala)passed away. Rakesh Jhunjhunwala was one of the factors for the market that had the ability to change the direction of the market. A large section of investors were watching Rakesh Jhunjhunwala for cues. The stocks that Rakesh used to invest in or increase his investment in were his people buying more stocks. In such a situation, the question is being raised as to what effect the departure of Rakesh Jhunjhunwala will have on the market sentiment.
How strong is the portfolio?
Portfolio of Rakesh Jhunjhunwala(Rakesh Jhunjhunwala Portfolio)There were more than 45 companies till the end of the June quarter. He holds more than one percent holding in more than 30 stocks, including Star Health, Titan, Rallis India, Escorts, Canara Bank, Indian Hotels Company, Agro Tech Foods, Nazara Tech, Tata Motors, Orient Cement, Va. These include Tech Wabag, Aptech, Indiabulls Housing Finance, DB Realty. Most of these stocks are covered by many broking firms and also provide investment advice.
What will be the impact on the market and shares?
According to Asif Iqbal, research analyst at Choice Equity, it is true that Rakesh Jhunjhunwala was one of the top investors in the country and all market stakeholders must have been shocked by Rakesh’s death. However, it will not have much impact on the general business of the market as a whole. In fact the Indian market base is very strong and companies will see business based on their own fundamentals.
However, Asif said that the companies in Rakesh Jhunjhunwala’s portfolio that were under pressure were those with weak fundamentals and in which Rakesh had a significant stake. Tuesday’s trading may see a steep drop.
Rakesh Jhunjhunwala used to invest for the long term and invest in companies that give them growth opportunities. Due to which both the company and their investment increased. However, the death of Rakesh Jhunjhunwala may create uncertainty regarding new investments for these companies. On the other hand, if the financial condition of the companies remains weak, the uncertainty will increase further.
Many stocks can fall sharply due to this reason. According to Asif, the more companies with poor financial condition depended on Rakesh Jhunjhunwala, the more the decline is possible. However, the health of strong companies included in Rakesh’s portfolio will not be affected and further buying in stocks will continue.