We stumbled upon a really interesting story of a man who made a fortune by investing early into Wipro. The story is very enticing, but there’s no way we could verify the credibility of the claims made in this awe-inspiring story.
This is the story of a villager from Jalgaon, Maharashtra who turned into a millionaire over a long term investment
The year was 1980. Mohammed Anwar Ahmed, a 27-year-old resident of Amalner, in Maharashtra, had Rs 20,000 with him as an inheritance after his father’s death. He thought of investing when he came across a visiting broker from Mumbai, Satish Shah, who had come to acquire shares of Wipro from the residents of Amalner.
The journey begins…
Shah asked Mohammed’s to go from door-to-door and acquire as many shares as he could from the residents. He helped and as a parting gift, Shah offered him 100 shares at a face value of Rs 100 each. Mohammed agreed and invested Rs 10,000 of his inheritance and invested the remaining 10k to start a tiny trading outfit.
How his initial investment of Rs.10,000 grew to over Rs.500 crores.
In 1981, the company declared a 1:1 bonus. He now had 200 shares.
In 1985, the company declared 1:1 bonus. He had 400 shares.
In 1986, the company split the share to Rs.10. He thus had 4000 shares.
In 1987, the company declared 1:1 bonus. He hence had 8000 shares.
In 1989, the company announced a 1:1 bonus. Now he had 16,000 shares.
In 1992, the company declared a 1:1 bonus. By now he had 32,000 shares.
In 1995, the company declared a 1:1 bonus. He then had 64,000 shares.
In 1997, the company declared 2:1 bonus. He now held 1,92,000 shares.
In 1999, the company split the share to Rs.2. He now had 9,60,000 shares.
In 2004, the company declared 2:1 bonus. He thus had 28,80,000 shares.
In 2005, the company declared 1:1 bonus. He came to have 57,60,000 shares.
In 2010, the company declared 2:3 bonus. He now had 96,00,000 shares.
The current market price is Rs. 599 per share. The shares are valued at Rs. 575 crores.
Hence, his shares are valued at Rs. 599 X 96,00,000 (number of shares) = Rs. 575 crore.
Also, over the last 33 years, he has received dividends of Rs. 118 crores from Wipro.
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Thus, by investing Rs. 10,000, Mohammed has gained a massive Rs. 575 + 118 = Rs. 693 crore
He is now retired and donates freely to charity from the dividends he receives. Not just that, he has vowed of not selling a single share till Mr. Azim Premji is the Chairman of Wipro.
The question is: Is this story cooked up to garner interest in stock market investing? Or this is actually a true incident. Myth or reality?
Ready to dig deeper? Do let us know your findings.