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Last Updated : Oct 19, 2017 05:47 PM IST | Source: Moneycontrol.com

Top 10 stocks which gave up to 300% return in last 4 out 5 Samvat years; do you own any?

Samvat 2074 is unlikely to be any different from Samvat 2073. Analysts expect stock specific action to dominate next 12 months while benchmark indices could well give another high teen return in the same period.

Kshitij Anand @kshanand

The festival of lights, Diwali is just a few days away and there are fireworks all around on D-Street with benchmark indices touching record highs in the run-up to the event. If you would have invested in equities at the start of Samvat 2073 chances are you might be sitting on a huge pile of profits.

However, chances of you making a sound return on your investments increase exponentially if you would have invested in ten stocks which historically have given smart double-digit returns in the last five Samvat years.

Top stocks which have given returns up to 300 percent in the last four out of five Samvat years include names like Britannia Industries, Eicher Motors, Transpek Industry, Avanti Feeds, Hester Bio, Natco Pharma, Hatsun Agro, Sakuma Exports, LT Foods, Ruchira Papers and Indian Terrain.

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Britannia Industries, the FMCG major, more than doubled investors’ wealth in two out of five Samvat years. It rose nearly 40 percent in Samvat 2073. For the September quarter, the event such as GST will have a short-term impact on sales, but it is positive in the long run.

New product addition and expansion in distribution channels will help the company to post steady earnings growth in the coming years, suggest experts. The stock is currently trading at 42x its FY2019E earnings.

Insight 18 | Samvat 2074: The Story Behind Muhurat Trading

Another company which has been investors’ favourite is Avanti Feeds. The stock hit a fresh record high on Tuesday. It has already rallied over 400 percent so far in the year 2017 and about 360 percent in Samvat 2073.

It rose by about 3 percent in Samvat 2072 but it has been a massive outperformer in the last five years. The stock rose over 500 percent in Samvat 2017 and over 50 percent each in Samvat 2071 and Samvat 2069.

Ruchira Papers, LT Foods, Sakuma Exports, Hatsun Agro also did not disappoint investors. Shares of these companies more than doubled investors’ wealth in two out of five Samvat years.

Sectoral Performance

Among the sectors, the S&P BSE Consumer Durable index rose by over 40 percent in Samvat 2073, followed by metals index which rose 39 percent, and Realty index gained 37 percent in the same period.

The S&P BSE Smallcap index rose 24 percent while the S&P BSE Midcap index gained 18 percent compared to 16 percent rise in the S&P BSE Sensex.

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Going into Samvat 2074, analysts advise investors to focus on sectors which are related to consumption, economy and govt policy.

These sectors are likely to hog the limelight. IT and pharma could well show some gains if the rupee depreciates further but they have headwinds which would cap upside.

“The key overweight sectors for us are – Cement, Capital Goods, and Oil & Gas. Government’s continued focus on affordable housing and infrastructure creation should aid demand in Cement and Capital Goods,” Harsha Upadhyaya, CIO- Equity, Kotak Mutual Fund told Moneycontrol.

Oil&Gas sector is likely to deliver one of the more consistent sets of earnings growth in the market and is also reasonably valued.

“Some other sectors such as Pharma, Telecom and IT are facing structural headwinds and earnings are under pressure. We do not envisage any improvement in the short to medium term in these sectors,” said Upadhyaya.

He further added that valuation-wise there are many other sectors such as NBFCs, FMCG etc. which are trading at rich multiples, and therefore could pose risk.

Outlook for Samvat 2074

Samvat 2074 is unlikely to be any different from Samvat 2073. Analysts expect stock specific action to dominate next 12 months while benchmark indices could well give another high teen return in the same period.

The broader market looks extremely strong although some stocks could be displaying frothy valuations. But, corporate earnings growth which is likely to rebound in next few quarters should lead the recovery and support sentiments, suggest experts.

“Market looks extremely strong and amid a bull rally. Nifty has already hit a high and Sensex followed the suit. So far as Samvat 2074 is concerned, I am optimistic about the market. I am expecting Nifty to give 15-17 percent returns in the next one year,” Prakarsh Gagdani CEO, 5Paisa Capital, A subsidiary of IIFL Group told Moneycontrol.

“The main reason for this surge is healthy domestic inflows and I don’t see any reason why domestic inflows would reduce in coming months. I expect the next year to be much better in corporate earnings’ than this year. I am sure the effect of demonization which was there on the economy will fade out over next year,” he said.

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First Published on Oct 18, 2017 09:02 am
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