Jhunjunwala takes his biggest hit in 10 quarters: Here's a look at his bets

But shows increased stake in stocks under a cloud- including Dewan, SpiceJet and Fortis

A smallcap focus may be weighing on Rakesh Jhunjhunwala’s portfolio in this downturn.

The disclosed value of his portfolio showed a double-digit decline in the three month ending September. This is the biggest fall in at least the past ten quarters. The portfolio was worth Rs 123.33 billion at the end of June 2018. It was worth Rs 106.33 billion at the end of the September quarter. Smallcaps account for the largest number of his stock-picks.

Source: Capitaline, Compiled by BS Research Bureau. Note: Based on holdings under eight different names culled through disclosures and other publicly available sources.

 

Such a fall has now happened for the third quarter in a row. The portfolio recorded a sequential fall in disclosed value of six per cent in the March 2018 quarter. It fell another 5.1 per cent in the June quarter. It was down 13.8 per cent showed September quarter disclosures.

Companies only disclose shareholder names if the stake exceeds one per cent. The data is based on holdings that Business Standard located using eight different names. The list included variations of his name, that of his spouse, and various permutations of the same. It would exclude companies where his stake is less than one per cent. The disclosed portion is still Rs 106.33 billion, which is likely to account for a significant part of his portfolio and broadly indicative of his investments’ quarterly trend in terms of returns.  

Some of the fall may be attributed to the battering that smaller stocks have taken.

The S&P BSE SmallCap index is down 25 per cent since the beginning of the year. The S&P BSE MidCap index is down 16.85 per cent. Both have underperformed the S&P BSE Sensex, composed of largecap stocks, which is up 2.63 per cent.

Smallcaps account for 26 out of the 32 companies in his portfolio. Four companies fall in the midcap space. Only two can be classified as largecap companies as per regulatory guidelines.

Relatively defensive sectors dominate however. And this has only increased. The weightage of consumer stocks is up from 53 per cent to 57 per cent in the September quarter. Healthcare is up from eight per cent to 10 per cent.  

Source: Capitaline, Bloomberg, BS Research Bureau

Other notable buys in this quarter include Dewan Housing Finance Corporation where his stake rose from 2.76 per cent to 3.2 per cent. Another was Fortis Healthcare where Jhunjhunwala now holds 2.41 per cent. He had no stake disclosed in the June quarter. Both companies have been under a cloud in recent times. Dewan Housing stock plunged over 50 per cent in a single day on account of rumours of liquidity issues plaguing the non-banking financial company (NBFC) sector. Fortis has been in the middle of a takeover even as founders battled allegations of impropriety. He also picked up a stake in beleaguered airline SpiceJet even as airlines have been struggling on account of high fuel prices.

Stocks in which he cut stake include his long-term bet on rating agency Crisil. His stake in the company dropped from 5.52 per cent at the end of the June quarter to 3.8 per cent in September. He also dropped his stake in  Jaiprakash Associates from 2.1 per cent in June to 1.1 per cent by September-end.

Company	Stake %	Value (Rs Mn)
Titan Company	7.12	50,916
Lupin	1.79	7,291
Escorts	8.16	6,111
CRISIL	3.77	4,798
Delta Corp	7.38	4,156
NCC	9.44	4,145
Rallis India	9.41	3,305
Dewan Hsg. Fin.	3.19	2,757
Karur Vysya Bank	4.16	2,564
Federal Bank	1.72	2,408
V I P Inds.	3.69	2,154
Edelweiss.Fin.	1.08	1,912
Jubilant Life	1.57	1,828
TV18 Broadcast	2.97	1,790
Fortis Health.	2.41	1,689
Aptech	24.05	1,578
Multi Comm. Exc.	3.92	1,381
Firstsour.Solu.	2.90	1,235
Agro Tech Foods.	7.09	984
Geojit Fin. Ser.	7.57	866
SpiceJet India	1.25	511
Ant Raj	3.22	355
ION Exchange	5.46	301
Prakash Inds.	1.53	285
Orient Cement	1.22	232
JP Associates	1.13	182
Man Infra	1.21	121
D B Realty	2.06	107
Autoline Inds.	8.34	106
Mandha Retail	12.74	105
Prozone Intu	2.06	93
Bilcare	8.49	62

*As on September 20, 2018. 
**Source: Capitaline, Compiled by BS Research Bureau

***Note: Based on holdings under eight different names culled through disclosures and other publicly available sources.