Slowdown in the US and Europe, selling by foreign institutional investors, layoffs, rising interest rates, volatility and uncertainty are some of the top buzzwords which must be testing your patience on Dalal Street nowadays. However, historical data showed that if you keep the noise away from your high-conviction bets then they may change your fortune in the long run. How?
As many as 22 stocks, which were below Rs 1 in January 2003, have surged over 11,000 per cent in the past 20 years. With a rally of 3,59,345 per cent, shares of Jyoti Resins have jumped to Rs 1,198.15 on January 20, 2023, from Rs 0.33 on January 20, 2003. This means Rs 10,000 invested in the stock 20 years ago has now turned into over Rs 3.50 crore at present.
It was followed by Symphony which climbed 2,92,264 per cent to Rs 964.80 from Rs 0.33 during the same period. Borosil Renewables (up 1,92,058 per cent), JSW Steel (up 1,28,761 per cent), Relaxo Footwears (up 96,618 per cent) and Kitex Garments (up 94,413 per cent) stood among other majors gainers in the list. All of these stocks were available at less than Rs 1 in January 2003.
Anand Rathi Share and Stock Brokers has a ‘Buy’ call on Symphony with a target price of Rs 1,194. “Rising mercury levels could brighten Symphony’s fortunes. The inflationary context in the USA and Australia and rising logistics costs could dampen prospects of overseas subsidiaries and are key monitorable. Keen competition from peers with strong brands and marketing networks in the summer of the calendar year 2023 would also be an important factor to watch,” the brokerage said in a report last month.
Data further highlighted that players like Poly Medicure, UPL, Lloyds Metals & Energy, Manappuram Finance, Aegis Logistics, La Opala RG, Elecon Engineering Company and Gulshan Polyols also jumped over 50,000 per cent in the past 20 years. All of these stocks were also penny stocks in 2003.
On asking how to create wealth in the domestic equity market, Kolkata-based investor Soumya Malani said, “You need to have an optimistic mindset and outlook to create wealth in the equity market. This doesn’t mean that we need to stop being realistic. However, it means that we should always keep an open mind, believe that the next big opportunity might be around the corner, and keep looking out for that.”
“From the last 2 decades, we have been told that this decade belongs to India. This time it seems to be coming true. Let’s wear our seat belts and get ready for the wealth creation journey.”
Ganesh Benzoplast, HCP Plastene Bulkpack, Gujarat Ambuja Exports, Shukra Pharmaceuticals, Mold-Tek Technologies, Jasch Industries, Bhansali Engineering Polymers and Nicco Parks & Resorts also rallied between 10,000 per cent and 50,000 per cent during the same period.
Going ahead, brokerage ICICI Securities believes that themes related to corporate and government capex, real estate cycle, credit growth and pockets of discretionary consumption to outperform in the ongoing calendar year.
For stock-specific investors, ICICI Securities believes that L&T, BHEL, Siemens, Thermax, Techno Electric, Astral, Green Panel, Century Ply, Phoenix Mills, Brigade Enterprises, UltraTech, JK Cement, JK Lakshmi, JSPL, Jindal Stainless, HAL, BEL, Solar, TCI Express, Gati, ONGC, IOCL, IGL, NTPC, NHPC, Coal India, Bharti Airtel, Tata Communications, Gujarat Fluorochemicals, Tatva Chintan, Ashok Leyland, Mahindra CIE, Balkrishna Industries, Dr Reddy, Torrent Pharma may benefit from investment cycle and manufacturing push.
It also thinks that SBI, Axis Bank, Aditya Birla Capital, SBI Life and LIC may gain from credit growth and insurance push, while ITC, Jyothy Labs, Jubilant, Sapphire Foods, Indigo, Tata Motors, TVS Motors, Indiamart, Delhivery, Havells and Crompton will be the beneficiaries of discretionary consumption and rising internet penetration.
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