At a webinar organized by Equirus, India’s Big Bull wished Zomato good luck but said he is not going to buy its shares.
He explained: “What I buy is very important, at what price I buy is the most important. Let Zomato be worth Rs 99,000 crore and Tesla be $600 billion or $6 trillion. I am not going to buy these stocks,” Jhunjhunwala said.
He said he need not go to every party in town. “Hangover comes only the next day!”
Zomato on Friday soared 65.59 per cent on its listing day to settle at Rs 125.85, commanding a market capitalisation of Rs 98,731.59 crore. This is even as some brokerages were questioning the Rs 65,000 crore valuations the IPO was commanding.
Jhunjhunwala said one-third of his investment is now in unlisted space and that he has also invested in a new airline. He said what he has learnt from startups is that one over-anticipates changes, especially with technology companies.
“Changes do come, but at a much slower pace than anticipated,” he said.
Jhunjhunwala said he does love the attitude of young entrepreneurs. He called the speed and devotion the young entrepreneurs put in as unbelievable. He said what a company needs is opportunity, frugality, corporate governance, technology, and an ability to change. “The race is not ending tomorrow,” Jhunjhunwala said.
He said he only wishes that people give focus only to business models which produce cash rather than taking foreign money and burning billions in dollars.
“Who built Zara or Walmart? The capital is not so important but the business model,” he said.
“I am interested in a cash flow model, valuations will have to follow. My valuations should not be more important than business model and sustainability,” he said, adding that people are being far optimistic about how fast new-age companies would produce cash.
“Today you value Zomato at Rs 1 lakh crore. But when is Zomato going to get Rs 3,000 crore of cash. In the stock market, it’s important how long it takes, it’s more important how long it lasts,” he said.
