Rakesh Jhunjhunwala-owned stocks trade mixed. Should you buy, sell, hold?

The decision to stay with these stocks, analysts said, should be based purely on how each of these companies is performing fundamentally

Shares of Rakesh Jhujhunwala and his wife Rekha Jhunjhunwala-owned companies are trading mixed on the BSE in Tuesday’s intra-day trade in otherwise a firm market. Rakesh Jhunjhunwala, one of India’s richest stock market investors, died at the age of 62 on Sunday in Mumbai, following a cardiac arrest.

WATCH VIDEO: How did Rakesh Jhunjhunwala make his billions?

Amongst his holdings, the market price of Aptech slipped 6 per cent on Tuesday, while Star Health and Allied Insurance Company dipped 5 per cent and Wockhardt lost 4 per cent. Nazara Technologies, Autoline Industries, Rallis India, Crisil and Tata Communication, on the other hand, skidded in the range of 1 per cent to 3 per cent on the BSE in intra-day trade.

Titan Company, the top holding in Jhujhunwala’s portfolio, traded 1 per cent higher at Rs 2,497, after hitting an intra-day low of Rs 2,433.80. Rakesh Jhujhunwala (3.98 per cent) and Rekha Jhunjhunwala (1.07 per cent) have collectively held 5.05 per cent stake in Tata Group Company.

However, Tata Motors, Tata Motors DVR, Bilcare, Orient Cement, DB Realty and Man Infraconstruction gained in the range of 1 per cent to 2 percent on the BSE in intra-day deals. In comparison, the S&P BSE Sensex was up 0.67 per cent at around 59,862 points at 10:38 am.

Rakesh Jhujhunwala and his wife Rekha Jhunjhunwala held an over 1 per cent stake in the above-mentioned companies as on June 30, 2022, according to shareholding pattern filed by these companies.

“The development will only have a short-term sentimental impact on the related stocks. Many market players/participants knew that Rakesh (Jhunjhunwala) was not keeping well since the past few years. RARE Enterprises is a professionally run firm and I believe all the succession planning would already have been done. So, the market reaction will be temporary. Investors may want to exit these stocks just because he is not around is a different matter. I suggest investors look at the fundamentals of each company before taking the investment call,” said Ambareesh Baliga, an independent market analyst.

Meanwhile, shares of Rakesh Jhunjhunwala-promoted Star Health and Allied Insurance recouped their entire intraday loss after a weak start that saw the counter dip 5 per cent to Rs 662.75 levels. Rakesh (14.39 per cent) along with his wife Rekha Jhunjhunwala (3.10 per cent) collectively held a 17.49 per cent stake in the insurer as of the end of June 2022 quarter.

A K Prabhakar, head of research at IDBI Capital, too, believes that the decision to stay with these stocks should be based purely on how each of these companies is performing fundamentally.

“The stocks can see a knee-jerk reaction and can bounce back. Investors will be better off basing their decision on the fundamentals of these companies rather than getting carried away due to this development,” he said.