These 6 companies operating margin remains over 10% in last 4 quarters, stocks rises upto 60% in a year

As per the March quarter earnings season so far, most of the earnings were either muted or weak barring a few which were good amid the COVID-19 crisis. But, the management commentaries indicate that at least the first half of FY21 will be weak due to lockdown, and earnings downgrades are expected to continue in the coming quarters.

Though - during this quarter-end - some companies have given decent growth, it is interesting to see whether these companies were consistent in their past performance. If yes, it will give stronger confidence to the investors to believe in the company’s ability.

To see such decent companies’ availability on the BSE universe, Moneycontrol analyses higher-marketcap stocks which have been consistently able to post double-digit operating margins in the last four quarters. The significance of operating profits are an indirect measure of the efficiency of the business. The higher operating profit shows that the company's core business is more profitable.

To filter out such stocks we used certain criteria as follows
- We included only companies which were able to post at least 10 percent operating margin, and the net profit margin should be positive in each of the last four quarters.
- We considered only companies whose current market cap was above Rs 10,000 crore.
- We excluded banking and non-banking financial companies.

There are 27 companies on BSE that passed the above criteria. The list is majorly dominated by FMCG and IT stocks, which includes stocks like Nestle India, Hindustan Unilever, P&G Hygiene & Health Care, Marico, Godrej Consumer Products, HCL Technologies, Infosys, Tata Consultancy Services, Mindtree, Mphasis, Wipro and Tech Mahindra.

We drill this query further with their price-performance and consider only stocks that have gained over 15 percent in the last year. Interestingly, only six companies make the cut. Among that list, two companies are from the FMCG pack.