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Last Updated : May 26, 2020 01:56 PM IST | Source: Moneycontrol.com

ICICIdirect handpicks 7 stocks that could be leaders in the next bull run; do you own any?

The study reveals that Pharma, Chemical, IT, Insurance are some of the sectors which may assume leadership role over the coming years.


Picking stocks in a volatile market is tough, but history tells us that investors have created wealth mostly in adverse times. And, the year 2020 is no different as many stocks are trading near their multi-year lows.

“There are always opportunities in every adversity which exhibit bull moves even in a rough environment. We believe in the current uncertain scenario, when many stocks are at multi-year lows and finding opportunities is challenging have typically led the foundation for change in sectoral leadership,” ICICIdirect said in a report.

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ICICIdirect shortlisted resilient companies based on the technical framework and are supported by a reasonable business model with decent management pedigree that is being favoured by the market in the current environment and is likely to generate above-normal returns for investors in years to come.

The study reveals that Pharma, Chemical, IT, Insurance are some of the sectors which may assume leadership role over the coming years.

The domestic brokerage firm shortlisted 7 stocks that could give 19-24 percent returns in the next 1 year - Britannia Industries, Sanofi India, L&T Infotech, Syngene International, Dr. Lal Pathlabs, Navin Fluorine, and India Cements.

ICICIDirect May 24


What does history say?

Historically, post three major corrections of 1997, 2000, and 2008, stocks which outperformed during the initial base formation phase, turned out to be leaders of the next bull market and generated multi-fold returns in the following three years.

Index corrections exceeding 40 percent from the top had led the foundation for the next multi-year and multi-fold rally. Usually, after such sharp decline indices undergo basing formation for the next six-nine months, which is an opportune time to construct long term portfolios.

Learning from the history that the market may embrace new sectors going ahead, investors should, therefore, realign their portfolios accordingly, said the report.

ICICIdirect technical screener which is anchored on the above technical concepts was then applied on a universe of 918 stocks listed on NSE, to find the 2020 outperformers. More than 100 stocks made to the list.

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First Published on May 26, 2020 01:56 pm
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