Rakesh Jhunjhunwala poorer by Rs 700 cr

High profile investor Rakesh Jhunjhunwala, whose net worth zoomed over Rs 2,000 crore on May 10, has on Tuesday become poorer by almost Rs 700 crore.

Jhunjhunwala's key holdings eroded in value during the past one month as follows: He lost Rs 85 crore in terms of Bharat Earth Movers stake, Crisil (Rs 40 crore), Lupin (Rs 70 crore), Nagarjuna Construction (Rs 100 crore) and Titan (Rs 90 crore).

Despite the erosion in wealth, Jhunjhunwala believes the bull market is very much alive and kicking. "Although factors known or unknown may slow it, it will need God's wrath for it to be reversed prematurely," he said, while making a presentation at an equity seminar held in the city recently.

Jhunjhunwala said he stood by what he felt were the key drivers of the bull market. The renowned broker said India's economic growth, corporate performance, vast under-exposure to equities in India and the tectonics shift of imperatives to invest in emerging markets were prime drivers of the country's bull markets.

After an unprecedented rise in the benchmark index, the Sensex "� from 6000 to 12600 in 12 months "� and excesses becoming apparent, it was only logical that the exuberance be corrected, Jhunjhunwala said.

However, the intrinsic structural and secular bull market story is very much alive and kicking, he reiterated. "Corrections and consolidations are part and parcel of all bull markets, and they cleanse interim excesses. How far and how deep the price correction and how long the time correction or consolidation will last are anybody's guess, he said.

Jhunjhunwala predicted that in the absence of earnings damage, the Sensex would trade in the 9250-9750 range, acting as a strong support.

"Markets are not going to make a new high in a hurry. There is risk to market recovery since there is a risk to earnings growth of India Inc. Rising input costs, market slowdown and increasing interest rates are the major hurdles to earnings growth, going forward," the stockbroker said.

Dwelling on the external factors, he said politics in India, risks to valuation and sentiment, global asset allocation shift, global and domestic liquidity, growth perceptions, currency and current account deficit are at present the impeding factors for bull markets.

"However all these risks can only temporarily impact "� and not reverse "� the basic direction of earnings, valuation and sentiment," Jhunjhunwala said.

He warned and advised, saying, "Despite all-round optimism and unprecedented gains, never forget the four-letter word associated with equities "� RISK. As a trader, react to price; as an investor, react to fundamentals.

Don't always react to the apparent, or with the herd. Investing success is not a one-way street. It is not about buying the optimism and selling the pessimism.

Superior investment returns are not gained without pain, time, introspection and doubt." "Expect realistic returns, this is not a Casino. Be greedy, but be long-term greedy. Despite all-round pessimism, never forget the opportunity in equities," he said.