Pankaj Pandey, Head of Research, ICICIdirect, tells Rahul Oberoi that it is important to stick to companies that give consistent results over 6-7 years.
Is there a way by which one can pick stocks which can surge more than 10 times in the long run, say, over 6-7 years?
There was never any secret recipe invented to spot multi-baggers. There are some which give transitory gains but if you aren't clued in on the markets, these can produce nasty results. It is, thus, important to spot the long-term performers which can produce consistent results over 6-7 years. To spot these, you need to check their core business model, relative market position and competitive positioning, management bandwidth and historical track-record under various market cycles. Also, one must look at the ability to deliver sustainable core earnings and finally, valuation. Some of the multi-baggers over the past two decades have been Infosys, Hero Honda, Lupin, Sun Pharma.
|YOUR GUIDE TO UNDERSTANDING MARKETS|
|It's Bull v/s Bear on the stock markets|
|2.||Market volatility tests investor patience|
|3.||'Lacklustre trading to continue for some quarters'|
|4.||'Firms with good management deliver well on bourses'|
|5.||Invest in stocks with sound fundamentals|
|6.||Pick the best IPO to invest in|
|7.||Check grades before investing in IPOs|
|8.||'Look beyond grading when investing in firms'|
|9.||8 Deadly Sins of Investing|
|10.||'Widespread investment by people will lift the market'|
|11.||Expected mixed response to MII report: Bimal Jalan|