HOW Rs.10,000 TURNED INTO Rs.16,421.86 CRORES - Wipro Stock
HOW Rs.10,000 TURNED INTO Rs.16,421.86 CRORES
A Story of Patience and Conviction
Mohammed Anwar Ahmed, a 72-year-old resident of Amalner in Jalgaon district, Maharashtra, embarked on an extraordinary financial journey that transformed his life. In the 1970s, his father owned a vast farmland. However, after his father’s untimely demise in 1980, Mohammed and his three brothers sold the land, dividing the Rs.80,000 proceeds equally. At just 27 years old, married with a one-year-old son, Mohammed found himself at a crossroads, uncertain about his future. While his brothers chose different paths—one leaving Amalner and the other two starting small businesses—Mohammed’s destiny was about to change in the most unexpected way.
THE HIDDEN GEM OF AMALNER
Amalner holds a special place in corporate history. In 1947, Mohammed Hussain Hasham Premji, father of Azim Premji, established a manufacturing plant for vegetable ghee, vanaspati, and refined oils. The company, originally known as Western India Vegetable Products Ltd., was listed on the stock exchange in 1946. Over the years, many Amalner residents became shareholders. In 1966, Azim Premji took over as Chairman, steering the company towards unprecedented growth.
A LIFE-CHANGING ENCOUNTER
One day, as Mohammed Anwar Ahmed sat by a tea stall, a young stockbroker from Bombay (now Mumbai) named Satish Shah approached him with a question that would alter the course of his life. Satish had come to Amalner to buy shares of Wipro on behalf of clients in Bombay.
He asked, “Do you know anyone here who owns shares in that factory?” pointing towards the Wipro plant. Mohammed, unfamiliar with the concept of shares, replied that the owners resided in Bombay. Intrigued, he listened as Satish explained how holding shares meant being a part-owner of the company. Their discussion, initially brief, extended for over 30 minutes as Mohammed’s curiosity grew.
Inspired by the conversation, Mohammed decided to assist Satish in finding local shareholders willing to sell their shares. In the process, he purchased 100 shares of Wipro at a face value of Rs.100 each, investing Rs.10,000 from his Rs.20,000 share of the family’s inheritance. He used the remaining funds to start a small trading business.
This single investment, driven by curiosity and faith, laid the foundation for an extraordinary financial success story—one that exemplifies the power of patience, conviction, and long-term investing.
Building Wealth Through Corporate Actions
Initial Investment:
1980: Purchased 100 shares at a face value of ₹100 each, totaling an investment of ₹10,000.
Corporate Actions and Shareholding Evolution:
- 1981: 1:1 Bonus Issue → Shares held: 200
- 1985: 1:1 Bonus Issue → Shares held: 400
- 1986: Stock Split from ₹100 to ₹10 → Shares held: 4,000
- 1987: 1:1 Bonus Issue → Shares held: 8,000
- 1989: 1:1 Bonus Issue → Shares held: 16,000
- 1992: 1:1 Bonus Issue → Shares held: 32,000
- 1995: 1:1 Bonus Issue → Shares held: 64,000
- 1997: 2:1 Bonus Issue → Shares held: 192,000
- 1999: Stock Split from ₹10 to ₹2 → Shares held: 960,000
- 2004: 2:1 Bonus Issue → Shares held: 2,880,000
- 2005: 1:1 Bonus Issue → Shares held: 5,760,000
- 2010: 2:3 Bonus Issue → Shares held: 9,600,000
- 2017: 1:1 Bonus Issue → Shares held: 19,200,000
- 2019: 1:3 Bonus Issue → Shares held: 25,600,000
- 2024: 1:1 Bonus Issue → Shares held: 51,200,000
Current Valuation (as of February 13, 2025):
- Market Price: ₹318 per share
- Total Shareholding Value: ₹318 × 51,200,000 = ₹16,281.6 crores
Dividend Income:
- Over the past 45 years, Wipro has consistently paid and increased its dividends almost every year.
- Based on available records from 1993 onwards, Mohammed has received approximately ₹140.26 crores in dividend income.
- Actual dividend figures may vary due to incomplete historical data.
- This passive income has further boosted his wealth, bringing his total financial gain to ₹16,421.86 crores (₹16,281.6 crores from shareholding + ₹140.26 crores in dividends).
Conclusion
- Unwavering Patience and Conviction: Despite market fluctuations and external pressures, Mohammed held on to his investment, allowing compounding to work in his favor.
- Massive Wealth Creation: A modest investment of ₹10,000 has grown into a staggering ₹16,421.86 crores, showcasing the power of long-term investing.
- Consistent Dividend Income: Over the years, ₹140.26 crores in dividends have provided significant passive income.
- Commitment to Charity: Now retired, Mohammed donates generously to charitable causes using the dividends he receives.
- Lifelong Investment Philosophy: Despite frequent advice from his highly educated children to sell his shares, he remains committed to his vow of not selling a single share as long as Mr. Azim Premji remains the working Chairman.
- A Lesson for All: This story exemplifies the profound impact of patience, conviction, and investing in fundamentally strong companies—proving that wealth creation is a marathon, not a sprint.
