Janakbhai: From JRD to Premji through GD Birla

MUMBAI: In the mid 1960s, a 10-year-old boy would alight from a car in front of Bombay House -- Tata Group’s headquarters in south Mumbai -- and go in to attend annual general meetings of Tata companies. As instructed by family elders, Janak Mathuradas would sit quietly at the back and listen to J R D Tata, the then chairman of Tata group, as he held forth on the prospects, current and future, of the company and the group, at large.Janak’s routine was similar when it came to AGMs of Birla group companies, then headed by G D Birla.
Janak is today better known as one of the minority shareholders who persuaded Wipro chairman Azim Premji to not delist the company’s FMCG business so that old shareholders like him could continue to be part of the Wipro investor community. His ability to persuade Premji to change his mind comes from the long relationships investor families like his built with the old businesses of India.
Like for other Dalal Street regulars of that time, for young Janak too, JRD was Tata Saheb and GD Birla was GD babu. Ratan Tata, who later succeeded JRD and was then an apprentice with group company Nelco, was Ratan seth. For Janak, who came from a family that invested in the stock market for three generations, AGMs and meeting with the Indian business blue blood was a regular affair.
Encouraged by JRD, who wanted young people to enter the stock market, Janak tracked the companies his family invested in closely just as today’s analysts do. His father, Mathuradas Morarji had taught him how to analyse company balance sheets. Then in 1977, on a circular ticket costing Rs 270, he travelled on the inaugural journey of Mumbai-Kolkata Geetanjali Express to Tata Nagar in Bihar (now Jharkhand) to see Tata factories, then to Delhi to visit Escorts factory, from there to Poddar Mills in Jaipur, to Gwalior Rayon in Gwalior, before returning to Mumbai after 18 days. This exposure at an early age helped him get into the family’s investment business with a keen eye to differentiate a good stock from a bad one.
Sitting at his century-old house in Kalbadevi area in south Mumbai, Janak talked of his family’s history and their philosophy in investing. He is the fourth generation in a family of investors on Dalal Street. His family came from the Bet Dwarka island near Okha in Gujarat. In 1870s, his great, great, grandfather, Hemraj Kanji, travelled in bullock carts for two months to reach Mumbai (then Bombay) and set up a textile business in the island city.
In late 1800s, the family started investing in stocks of companies listed on BSE which included foreign companies which were then allowed to trade here.
Over the years the family built a portfolio of stocks of companies from London, Burmah, Pakistan and Sri Lanka, in addition to domestic blue chips that included companies from the house of Tatas and Birlas, including Air India (later nationalised and delisted), Tata Motors (then TELCO) and Tata Steel (then TISCO), Karachi Electric, Imperial Bank of India (now SBI) and Century Textiles. “Today, our family is one of the oldest investors in some of the Tata group companies,” Janak said.
Through the years the family’s approach to investing has changed. “Earlier we were more interested in dividends yields on stocks,” Janak said. “Often a company with a face value of Rs 100 (which was usually the norm then), traded at Rs 40-50 and paid dividends of Rs 4-5. That gave us dividend yields of about 10% or more. Then we were not very interested about the future prospects of stocks like today,” he said.
From the very beginning the family was careful about its interests as shareholders and never held back from speaking their mind to the managements. “We once opposed the merger of Tata group’s power companies as we thought the ratio did not hold in favour of minority shareholders. However, later on the management explained to us the future prospects and positives from the merger and we agreed,” Janak said.
The same approach continues. In January, when Wipro Enterprises, the FMCG division curved out of the IT major, decided to delist its shares, Janak, along with other minority investors spoke to Azim Premji about why they want to remain invested in the company and Premji agreed.
From the very beginning, the family never speculated, but invested for the long term. Janak said. “Earlier, for several years, I used work through the night to update our records of holdings and dividends received, and deposit the dividend warrants in banks in the morning so that we could quickly invest those funds in stocks,” he said.“We also bought stocks on borrowed money,” he added.