What is the short-term impact on the share price when Rakesh Jhunjhunwala buys them.

What is the short-term impact on the share price when Rakesh Jhunjhunwala buys them?

by 5paisa Research Team Last Updated: Dec 12, 2022 - 12:57 am 51.5k Views
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Rakesh Jhunjhunwala bought Zee Entertainment Enterprises on September 14, 2021, stock has rallied from Rs 205 to Rs 270 with an intraday gain of 39.98%.

Whenever a big bull like Rakesh Jhunjhunwala has an eye on some company people get more interested in those stocks and just buy them. But if you enter a little late you might miss the short-term rally, and will be surprised knowing the impact of his stocks bought in 2021.

There are at least four instances in 2021 where stock price rallied immediately after Rakesh Jhunjhunwala entered the stock. Here are some of them.

  • Rakesh Jhunjhunwala bought Zee Entertainment Enterprises on September 14, 2021, in a bulk deal of 50 lakh shares at an average price of Rs 220. The transaction happened between 9 am and 10 am. The interesting part of the story is the stock has rallied from Rs 205 to Rs 270 with an intraday gain of 39.98%. Now the stock is trading around Rs 300 and the return for Rakesh Jhunjhunwala from the stock is 40% in 20 days.

  • Rakesh Jhunjhunwala bought IIFL Securities Ltd on January 2, 2021, in a bulk deal of 27 lakh shares at an average price of Rs 42.8. As the news spread, the stock rallied from Rs 47 to Rs 50 within two days of the transaction, where the short term gain was 6.3%. Now the stock is trading around Rs 99.2 and the return for Rakesh Jhunjhunwala from the stock is 110% in 10 months.

  • Rakesh Jhunjhunwala bought Fortis Healthcare ltd on March 17 and 18, 2021 in a bulk deal of 1.86 crore shares at an average price of Rs. 185. Within three days of that transaction, the stock rallied from Rs 185 to 212. The short term gain was 10%. Now the stock is trading around Rs 275.60 and the return for Rakesh Jhunjhunwala from the stock is 48.5% in six months.

  • Jhunjhunwala bought Aurobindo Pharma Ltd on April 7, 2021, in a bulk deal of 16.25 lakh shares at an average price of Rs 905. And yes, it happened again, as within two days of the transaction the stock price went from Rs 905 to Rs 952. The short term gain here was 5.19%. Now the stock is trading around Rs.735 and the return for Rakesh Jhunjhunwala from the stock is -18.5% in six months.

One can, if possible, enter the stock purchased by ace investor Rakesh Jhunjhunwala on the same day, and expect outperformance in short term, going by the recent stock price behaviour.

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