Rekha Jhunjhunwala Takes 1.5% Stake in This Bank Stock. Adds Fresh Position in an Auto Stock

The art of investing in stocks involves a combination of strategic planning, risk management, and a deep understanding of market dynamics.

Many investors seek professional advice to adapt to changing market conditions, while others follow investment gurus.

By following successful investors, you can benefit from their market-beating strategies refined over decades. You can capitalise on the extensive research already performed by experts, focusing your efforts on validation and suitability.

One such investor whose every investment garners attention is Rekha Jhunjhunwala, wife of late Rakesh Jhunjhunwala. Recently, she took a bullish view on two stocks.

A Word About Rakesh Jhunjhunwala

Rakesh Jhunjhunwala was an Indian billionaire stock trader and investor.

He used to manage his portfolio as a partner in his asset management firm, Rare Enterprises. He invested in both his own and his wife's name, Rekha Jhunjhunwala.

Rakesh Jhunjhunwala was known as India's Warren Buffett. According to Forbes, he was the 36th richest man in the country. He was worth Rs 460 bn when he passed away on 14 August 2022.

He was a director on the boards of several companies, including Viceroy Hotels, Concord Biotech, Provogue India, and Geojit Financial Services.

In this article, we'll discuss about two stocks recently purchased by his wife Rekha Jhunjhunwala.

#1 Canara Bank

First on the list is Canara Bank.

Canara Bank is a significant player in India's banking sector. As of March 2025, Canara Bank operates through a network of 9,849 branches and 11,144 ATMs across India.

The latest shareholding pattern of Canara Bank shows that Rekha Jhunjhunwala acquired a 1.5% stake in the bank.

The ace investor purchased 132 million shares or 1.5% in the March 2025 quarter. In the September 2024 quarter she held no stake in the bank.

While we don't know why the ace investor picked up stake in Canara Bank, there are some reasons that we can guess...

One possible reason can be due to the latest results. The bank reported a net profit of Rs 41.6 b for the December 2024 quarter, compared to Rs 37.38 b in the December 2023 quarter.

The net non-performing assets (NPAs) fell from 1.32% in the December 2023 quarter to 0.89% in the December 2024 quarter.

Another potential reason for buying the stock could be the possibility of more repo rate cuts by the Reserve Bank of India (RBI). The country's central bank has already cut interest rates by 0.5% in 2025 and further cuts are anticipated.

This places banks in a sweet spot as their net interest margins (NIMs) are expected to expand when there are rate cuts.

Apart from this, the stock is also available at a good dividend yield of 3.5%.

For more details, see the Canara Bank fact sheet and quarterly results

#2 Escorts Kubota

Next on the list is Escorts Kubota.

Escorts Kubota is a joint venture between India's Escorts Limited and Japan's Kubota Corporation. It produces agricultural machinery and tractors for both domestic and international markets.

The latest shareholding pattern of Escorts Kubota for March 2025 shows that Rekha Jhunjhunwala acquired a 1.5% stake in this auto stock. For the September 2024 quarter she held no stake.

While we do not know the exact reasons why she decided to pick the stake, there are some explanations.

Escorts Kubota reported an 11.4% growth in tractor sales for February 2025, with a total of 8,590 tractors sold compared to 7,709 in the same month the previous year.

The company is likely to perform well on continued growth momentum due to increased Rabi sowing, favourable water reservoir levels, and a positive base effect.

It's also planning to invest Rs 45 bn in a new manufacturing plant over the next 3-4 years. The new plant aims to double the domestic tractor capacity from 1.7 lakh units to 3.4 lakh units annually. It will also include new engine and construction equipment lines.

The demand for agricultural and allied equipment is likely to augur well for the company. With the expansion plans too on track, investors can anticipate better financial performance.

For more details, see the Escorts fact sheet and quarterly results.

Conclusion

Simply replicating investment guru strategies has its pitfalls. Gurus often provide general advice that may not align with your specific financial goals, risk tolerance, or time horizon. Markets tend to evolve, and a rigid copycat approach may not adapt to changing conditions.

Also, blindly following their strategies can result in over-allocation to certain sectors or assets, increasing risk.

By understanding some limitations, you can make more informed decisions about whether to follow investment gurus and how to incorporate their advice into your investment strategy.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Happy investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...