Fastest growing stocks in india

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Best High Growth stocks India 2021

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Do you to know about the best High growth stocks in India which are consistent and High quality companies. The List of High growth companies have growth more than 40% in each year in the Last 5 years

List of Best High Growth Stocks in India

So here is the list of high growth companies with growth more than 40% in the last 5 years.

Gujarat State Petronet Ltd

Gujarat State Petrochemicals Corporation Limited was incorporated by Government of Gujarat in 1979. The company Revenue has grown by 63% [yoy] in each year for the last five years and the company has a turnover of Rs 12,244 Cr in the year 2020.

It was re-incorporated as Gujarat State Petroleum Corporation Limited in 1994 in order to establish a strong foothold in the entire hydrocarbon value chain. Over the years, the GSPC Group has emerged as the only Oil & Gas conglomerate to be promoted by a state government of India and has been successful in fulfilling the endeavor envisaged by the Government of Gujarat.

  • Sales Growth average [5 years] : 62.98 %
  • Turnover : Rs 12,244 Cr

The GSPC Group, which has under its umbrella twelve companies and institutions, has established itself as one of the largest E&P entities with a commanding presence across the entire hydrocarbon value chain. The group employs innovation and new technologies to constantly better its operations in both upstream and downstream segments.

Adani Transmission Ltd

Adani Transmission is in the field of Power Transmission. The Power transmission sector in India is well poised for growth with an enabling policy framework in place, large capacity additions and greater opportunities for private participation through tariff-based competitive bidding.

  • Sales Growth average [5 years] : 145 %
  • Turnover : Rs 11,416 Cr

The company Revenue has grown by 144.55% [yoy] in each year for the last five years. The company is one of the top High Growth stocks in India with a huge growth in the last 3 years.

AU Small Finance Bank Ltd

Founded in Jaipur in 1996 as Au Financiers, a non-deposit taking Non-Banking Finance Company (NBFC), it effectively worked on funding economic growth, especially for the under-served and un-served low & middle-class individuals. The company Revenue has grown by 43.5% [yoy] in each year for the last five years and the company has a turnover of Rs 4,841 Cr.

For over two decades the company provided secured funding to customers largely in Vehicle Loan, Business Loan and Housing Loan segments while organically spreading geographical presence.

  • Sales Growth average [5 years] : 43.5 %
  • Turnover : Rs 4,841 Cr

In 2015, when RBI came out with the Small Finance Bank licensing guidelines, AU was the strongest of the 10 selected entities out of 74 applicants to receive this coveted license thanks to its strong foothold and proven track record.

Aditya Birla Capital Limited (ABCL)

Aditya Birla Capital Limited (ABCL) is the holding company for the financial services businesses of the Aditya Birla Group.ABCL’s subsidiaries have a strong presence across Protecting, Investing and Financing solutions, ABCL is a universal financial solutions group catering to diverse needs of its customers across their life stages.  

  • Sales Growth average [5 years] : 44.03 %
  • Turnover : Rs 18,488 Cr

The company Revenue has grown by 44.03% [yoy] in each year for the last five years and the company has a turnover of Rs 18,488 Cr. Powered by more than 22,000 employees, the subsidiaries of ABCL have a nationwide reach with 850+ branches and more than 2,00,000 agents / channel partners and several bank partners.

Suumaya Industries Ltd

Established in the year 2011 by founder Mr Mahesh Gala, Suumaya Lifestyle Limited Company is a highly creative brand for exquisite fashion and brings the world’s finest collection of Indo-Western Designer Kurtis. The company Sales has grown by 41.5% [yoy] in each year for the last five years and the company has a turnover of Rs 1,327 Cr.

With over 30 years’ experience in Indian Ethnic merchandise market, the company has developed and honed systems to provide bespoke patterns ranging from traditional designs to even modern contemporary which spell out sheer beauty and class.

  • Sales Growth average [5 years] : 41.5 %
  • Turnover : Rs 1327 Cr

Attracting several thousand visits per month from across the world, the company has managed to set the bar in the Indian Ethnic Wear market by offering an unparalleled selection of prints and fabrics paired with unmatched service.

Apollo Tricoat Tubes Ltd

The company Revenue has grown by 61.6% [yoy] in each year for the last five years and the company has a turnover of Rs 18,488 Cr. Apollo TriCoat (formerly known as Best Steel Logistics) became a part of Sudesh Group of Companies, India’s leading steel pipe and tube manufacturer in 2018.

A pioneer in making steel tubes and pipes of premium quantity, the SG group has a manufacturing capacity of 2 million tons per annum. Apollo TriCoat aims to amp up the steel tubes and pipe manufacturing industry with its high-quality products, which are not limited to pipes and tubes only.

  • Sales Growth average [5 years] : 61.6 %
  • Turnover : Rs 1,234 Cr

Headquarters are located in New Delhi, India, Apollo TriCoat has its manufacturing facility in Malur Industrial Area, Bengaluru which has a total capacity of 50,000 tons.

So finally these are the list of High Growth stocks in India

Sours: https://indiancompanies.in/best-high-growth-stocks-india-2021/

Last Updated – June 2021

Growth Stocks to Buy

In this article, we will cover

– What are Growth stocks?
– Reasons for faster growth rate in the value of growth stocks
– Summary Table for best Growth Stocks to buy now
– Characteristics of Growth companies
– Growth stocks vs Value stocks
– Factors to consider to identify the best growth stocks to buy now
– Portfolio Companies
– Watch our video on how to analyse and pick Growth stocks for investments

What are Growth Stocks?

Growth stocks are stocks which are expected to grow at a faster rate than the industry average or the average rate of the industry in the given country. Faster growth means that the revenues and profits of the company are expected to grow faster than the industry average due to multiple factors such as:

  • The company operates in an industry which is growing at a faster than average growth rate driven by increased penetration or adoption rate among its customers.
  • The company has innovative products and/or services which are catching up in the market faster than their peers, thereby giving the company a competitive advantage over peers.
  • The company employs new technology which is not only more productive but also more efficient than existing technology, thereby giving the company an edge over others and is driven by increased adoption.

The above-mentioned are just a few reasons among many which can result in companies growing at an accelerated rate.

Reasons for faster growth rate in the value of growth stocks 

Faster growth means that the revenues and profits of the company are expected to grow faster than the industry average due to multiple factors such as:

  • The company operates in an industry which is growing at a faster than average growth rate driven by increased penetration or adoption rate among its customers.
  • The company has innovative products and/or services which are catching up in the market faster than their peers, thereby giving the company a competitive advantage over peers.
  • The company employs new technology which is not only more productive but also more efficient than existing technology, thereby giving the company an edge over others and is driven by increased adoption.

The above-mentioned are just a few reasons among many which can result in companies growing at an accelerated rate.

Summary Table for best Growth Stocks

COMPANY NAMENSE CODEBSE CODECMP (18 June’21)INDUSTRY
Bajaj FinanceBAJFINANCE5000346,087Finance (NBFC)
Britannia IndustriesBRITANNIA5008253,619Packaged Food
Muthoot FinanceMUTHOOTFIN5333981,472Finance (NBFC)
Petronet LNGPETRONET532522226Oil Marketing & Distribution
Coromandel InternationalCOROMANDEL506395877Fertilizers
Polycab IndiaPOLYCAB5426521,936Electrical Equipment
Gujarat State PetronetGSPL532702325Utilities
Deepak NitriteDEEPAKNI5064011,755Commodity Chemicals
Avanti FeedsAVANTIFEED512573583Food Products
Alkyl AminesALKYLAMINE5067673,529Specialty Chemicals
Caplin Point LabsCAPLIPOINT524742653Pharmaceuticals
IOL ChemicalsIOLCP524164621Pharmaceuticals
Bharat RasayanBHARATRAS59002112,337Argochemicals
KEI IndustriesKEI517569702Electrical Equipment

Characteristics of Growth companies

Growth companies offer returns better and faster than peers and hence have different characteristics as compared to the broader industry, such as:

  • Growth stocks usually trade at higher price multiples and valuations among peers, being valued at a higher premium justified by the better returns offered by these companies. Price ratios include P/E, EV/EBITDA and P/B ratios among others.
  • These companies usually do not declare dividends and even if they do, the dividends are very low. The reason for this being that these companies usually prefer investing their surplus cash into the business as it gives higher returns to shareholders rather than distributing the cash among them. Therefore, investors usually earn capital gains from the rise in their share price.
  • Growth companies usually display a significantly higher growth rate because they tend to possess some kind of competitive advantage over other companies in the same industry. The competitive advantage gives growth companies a unique selling proposition (USP), which helps them sell and grow better than other companies within the same industry.
  • Growth stocks usually trade with a stronger upward momentum over a longer term as compared to peers. The share price moves with the velocity as it adjusts to faster growth in revenues and profits earned by the company. While the momentum is strong, these companies may also exhibit more volatility among peers with average growth rates.
  • Since growth companies usually enjoy a competitive advantage over other companies within the industry, they tend to enjoy a loyal, growing consumer base. The USP that such companies enjoy over their competitors ensures a constantly growing consumer base, which contributes to their increasing growth rate.
  • While growth stocks are a very attractive investment option and can generate substantial profits over the long term, the level of uncertainty surrounding them in the short term contributes to a high-risk factor, thereby making them riskier as compared to more stable companies with average growth rate.

While growth stocks cannot sustain their rate of growth forever, as technology and trends change these companies stabilize their growth rates, these companies can provide investors with higher returns for a longer term such as 10-15 years as they penetrate and gain market share at a fast rate and generate strong profitability as the market around them develops and matures.

Growth stocks vs Value stocks

A very popular argument is of comparing growth stocks vs value stocks as they exhibit completely different characteristics when being evaluated. As mentioned earlier, a growth stock is characterized by higher price multiples and valuations and low dividend payouts while exhibiting a stronger and more volatile momentum in the market. As compared to this, value stocks trade at a lower price multiple, sometimes even lower than the industry average, while generating consistent and stable cash flows and regularly paying dividends to investors, ensuring consistent cash returns for shareholders.

Factors to consider to identify the best growth stocks to buy now

An investor needs to assess several factors to identify growth stocks for the long term which can consistently generate higher than average returns while ensuring that they sustain such growth over a longer period of time, supported by their business strategy and strong financials.

Assess the Sector/Industry Segment of the Company

An investor needs to first look at the sector the company currently conducts its business in. This is crucial to understand as the sector which has strong growth potential can offer higher growth to the investor. Strong growth potential can come from having scope to either expand or penetrate further into the market or both. If a sector also provides more headroom for increased pricing over time as it expands, that will only be beneficial for the given sector and the companies in it. The investor should also assess the number of participants in the sector and the intensity of competition to determine the growth opportunities for the company.

Industry Potential to Provide Growth

An investor needs to assess the position of the company in the supply chain of its industry and whether it can generate enough returns between its inputs and outputs to fuel growth. In the most basic sense, value addition is the difference between the value of raw materials and the value of finished goods. It is the value of the manufacturing and marketing processes that a company uses to convert raw materials into a finished product that it sells under its brand name to the final consumer as it adds value to the product/service it sells.

For example: oil marketing companies usually don’t have a large markup nor offer strong growth over the oil prices which move as per the regulation and crude oil prices, thereby making it a volume game and not one that adds much value on per unit sale. On the other end, majority participants in the NBFC sector have seen higher than normal growth both in terms of financials and stock price movement.

Return Generation for Shareholders

To assess this aspect, an investor needs to calculate certain ratios to determine the return generation as well as the quality of earnings. One such ratio is the ROCE (Return on Capital Employed). The formula for ROCE is EBIT/ (Total Assets – Current Liabilities). The ratio aims to compute the operating earnings a company generates on the capital it has invested into the business. The ratio indicates the efficiency with which the company utilizes its capital and the return it generates on that capital.

While this ratio is a good indicator, it should be used in conjunction with the cost of capital applicable for the company to determine the net return earned by the company. Another ratio to look at is the ROE (Return on Equity) which basically tells an investor how much of the profit is attributable to the shareholder and the quantum by which it grows the value of the company. This ratio is to be assessed in conjunction with the Cost of Equity, which is determined by assessing the required return on equity the investors have. The higher the ROE is over the COE, the better it is.

A higher ratio indicates stronger return generation from these companies which is critical in identifying growth stocks which are characterized by higher return ratios as well as higher price multiples over the industry average.

Management Quality

Among the most important factors in evaluating a business is the quality of its management. Efficient management teams will not only see through the various challenges facing an industry and navigate through them, but also transform their business models towards more attractive industries and higher growth of the business. Assess whether the board of directors and the management are different from each other as the BOD is responsible for larger company decisions while the management is engaged in the daily activities. Hence, the process of running a company involves balancing relationships and interests between the board, the promoters, the management, minority shareholders, auditors as well as other stakeholders.

The efficient handling of this balance indicates the strength of corporate governance. The higher and better the standards of corporate governance are, the better protected the minority shareholders of the company are and can be assured that the management will act for the benefit of shareholders. This can be ascertained by going through the annual report.

This is key for growth companies as these companies usually operate in high growth, high risk industries and a stronger management team will not only ensure maintaining a strong rate of growth over a longer term and delivering strong financial performance, but also ensure that the company is strong enough to weather through difficult times if any.

Portfolio Companies

Deepak Nitrite

Given its strong fundamentals, India’s chemical industry is expected to keep growing at a fairly strong pace after absorbing the shock in FY 2020 due to COVID-19. Also, the pace for the chemical industry’s adoption of technology continues to be on the rise. Looking towards an optimistic future, India’s chemical industry is set for sustained growth receiving impetus with capital investment and affirmative Government policies. Deepak Nitrite is a prominent chemical manufacturer in India. The company manufactures Basic Chemicals, Fine & Specialty Chemicals, Performance Products, and Phenolics. The company supplies its products across a diverse range of industries and big names such as Reliance Industries, Bayer, BASF, Hindustan Petroleum, Emami and Good Year among others, indicating a strong diversified portfolio of customers. 

On financials, the company has an excellent record of delivering above average returns. The company delivered a strong growth in Net Profit at 65% CAGR over the past 5 years. The company has also delivered a strong ROE of 39.6%, indicating a strong return for the shareholders of the company. Despite the strong growth in returns, the company currently trades at a P/E ratio of 30.8x which values the company attractively among peers.

Deepak Nitrite faces the risk from regulations regarding chemicals changing as certain chemicals may be controlled or banned under the law, thereby affecting the revenues and profits of the company.

Bharat Rasayan

Agrochemicals are chemicals that help boost crop productivity through prevention of destruction of crops by pests such as insects, weeds, fungus, etc. The global economy, in general, and Indian, in particular, is facing a multitude of challenges such as to feed an ever-growing population, reducing arable land banks and dealing with adverse climatic changes. Under such circumstances, the traditional methods of growing more crops are rendered inadequate. There is a growing acceptance to launch advanced agrochemical solutions to achieve higher field productivity.

Indian agriculture is on a growth path, with an increase in investments and private funding in the past few years. The sector is expected to grow with better momentum in the next few years, owing to an increase in investment in agricultural infrastructure such as irrigation facilities, warehousing and cold storage. Factors such as reduced transaction costs, time, better port gate management and fiscal incentives will also contribute to this upward trend. Furthermore, the increased use of genetically modified crops is also expected to better the yield of the Indian farmers. Advancement in agriculture and allied sectors is positive for inclusive economic growth at the national level. India is the largest producer, consumer and importer of pulses in the world. As farmers find themselves in a more comfortable situation, the agriculture sector will gather further momentum. 

Apart from the loyal customer base that the Company is enjoying since the last several years now, many newer domestic as well as overseas customers are added to their portfolio during the year & same is expected to increase in near future due to their commitment of supplying high quality products in a time bound manner. Moving ahead, Bharat Rasayan remains poised to implement key initiatives across functions to enable itself to face market challenges and leverage the emerging opportunities. It remains focused on improving revenue growth and profitability, driven by high growth segments such as seeds and nutrients.

The company has delivered strong financial performance over the years, while delivering a strong Net Profit growth of 38.2% CAGR over the past 5 years. The company has delivered a strong ROE of 32.9% as of Q3FY21 as well. It has also been growing its operating profit margins from 6% in 2010 to 19.5% in 2020, driven by cost optimization and operational efficiency. The company trades at a fairly attractive valuation of 34x P/E given the strong growth delivered by the company.

Despite the strong growth drivers, Indian agrochemicals industry faces challenges in terms of low awareness among a large number of end users spread across the geography. Managing inventory and distribution costs is a challenge for the industry players in the wake of volatility in the business environment.

KEI Industries

The Government’s huge push to develop infrastructure will fuel the need for quality cables and wires, which will boost the development of the C & W (Cables and Wires) industry in India. As per the industry report by Yes Securities, the C&W industry grew by a whopping 23% CAGR in volume between FY 2013-14 and FY 2017-18 to touch 14.5 million kms. In terms of sales value, it recorded 11% CAGR over the same period. The market size of the C & W industry is expected to grow by 15% CAGR from ₹525 billion in FY 2017-18 to ₹1,033 billion in FY 2022-23. This is primarily due to abundant growth in the affordable housing segment and increasing electrical product-related distribution activities.

Power and Infrastructure form the most critical end-user industry of C&W and are also crucial for the sustained growth of the C&W industry. As per the Economic Survey 2018-19, total installed capacity of power in India has increased to 356.1 GW (Gigawatt) in 2019 from 344 GW in 2018.

KEI Industries Limited is amongst India’s top three wire and cable manufacturers, with a comprehensive product portfolio ranging from housing wires to Extra High Voltage (EHV) cables. The company has been integrated into Engineering, Procurement and Construction (EPC) services for power and transmission projects as well. The high-quality solutions have made the company a trusted and preferred provider in the Retail, Institutional and Export segments. It stands to benefit from multiple venues such as wire requirements from the Power & Infrastructure sector, which is touted to develop as the energy generation and distribution develops in India. Another segment of demand comes from rising development from Housing. Retail segment sales are also gaining more traction owing to faster offtake and higher margins for the company. Despite the rise in commodity prices throughout 2021, the company has been able to leverage its position and offers value-added products which allow it to pass on the rising costs onto its customers, allowing it to cushion the impact on margins to a certain extent.

The company has performed well financially, with the company seeing a strong rise in the revenues as well as profitability, with revenues growing by 12% CAGR over the last 5 years while the Net Profits grew at an industry leading pace at 34% CAGR over the same period. The company has generated an average ROE of 21% over the past 5 years, indicating a consistent return for shareholders. While KEI has delivered strong and consistent growth, the stock trades at a P/E of just 23.1x, indicating it being attractive, given the huge growth prospects it offers to investors.

The Company’s EPC and EHV segments are majorly exposed to government policy changes. The Company has major business involvement in power utilities, infrastructure, real estate and industrial sectors which are again cyclical in nature. Thus, its product revenue and demand are exposed to interest rate fluctuations and capex cycles which can affect the profit growth of the company.

Bajaj Finance

The NBFC sector primarily entails lending activities such as consumer loans, gold loans, personal loans, etc. but are different from banks as they do not take deposits from people. These companies rather borrow money from one institution and lend it out to consumers, thereby earning the interest differential between its lending and borrowing activities. This segment has been seeing rapid growth as the country sees an increase in disposable income and shift towards consumerism by Indians.

Bajaj Finance primarily operates in the consumer lending space, wherein it gives consumers loans for personal consumption purposes. The company has therefore seen a massive rate of growth driven by a fast rate of adoption and penetration of their lending, driven by their strong network across the country. Bajaj Finance has delivered strong performance aided by a diversified product mix, robust volume growth, prudent liability management, efficient operating costs and effective risk management. With a standalone AUM of ₹115,418 crore and a consolidated AUM of ₹152,947 crore for FY21, the Company has emerged as one of the leading diversified NBFCs in the country today.

On financials, the company has delivered a ROE of 12.8% for the year while seeing a robust growth in Net Profits of 28% CAGR over the last 5 years. The company has also delivered a strong growth in the AUM at 31% CAGR on a consolidated basis as of 2021 over the last 10 years. Despite the strong profit and AUM growth, it has maintained the quality of the book with an industry leading low net NPA of just 0.75% for FY21 (consolidated), indicating that the loan book remains strong. Bajaj Finance employs a strategy of maintaining a longer duration for liabilities than assets, coupled with an optimal mix of borrowings between banks, money markets, external commercial borrowings and deposits which have helped the company effectively manage net interest margins (NIM) at 11.3% for FY21.

The company faces risk in case of defaults from customers, resulting in the deterioration of the AUM quality of the company. Another risk may emerge from the interest rate cycle movement, which may impact the NIMs of the company, and therefore the income earned. Investors need to carefully observe the interest rate nature as well as the overall economic condition to assess the performance of the company. Due to the onset of COVID-19, The financial industry has been under stress which is expected to affect financial companies due to moratoriums and increased defaults, which can affect the quality of the assets as well as the profits of the company. While the company commands a high quality book, the recovery from this situation is expected to be slower. Investors willing to take risk and hold on for the longer term can invest in the stock.

Britannia Industries

The FMCG sector is one of the most resilient and among the fastest growing segments in India. The food segment is among the fastest growing segments in FMCG, driven by rising penetration of processed food consumption driven by penetration in both urban and rural demand and rising disposable incomes of households in India. Britannia is one of the largest FMCG companies in India, with a portfolio across multiple products such as Biscuit, Bread, Cake, Rusk, Dairy and Adjacencies. Biscuits, from which the company derives over 75% of its revenues, is India’s largest food category and is considered as an essential, in practically every Indian family’s consumption basket. It is one of the most deeply penetrated categories in the country, reaching over 90% of the households. The per capita consumption of biscuit in India is comparatively low at 2 kgs versus 10 kgs in certain developed countries. The low per capita consumption and high levels of penetration provide a good base to increase consumption through appropriate business strategies. Bread is considered as a staple food in many parts of our country. Consumer preference for healthy & premium products is providing significant opportunity in this category. The company derives about 15% of its revenues from this segment which includes bread and other bread based products. India is the largest producer and consumer of dairy products and currently contributes approx. 20% of the global production. In the past few years, the processed milk products market has witnessed sustained growth due to increasing urbanization, rising disposable income and proliferation of retail outlets beyond Tier 1 cities. The Company uses the intrinsic strengths of its brands, innovation capabilities, strong distribution network and cost efficiency programs to maintain an edge among peers in the industry. While being well positioned with a strong management team, technology interventions and robust processes.

Financially, the company has delivered a robust set of numbers, with strong net profit growth of 18% CAGR over the past 5 years. It has also delivered a strong ROE of 46.9% while the ROCE stands at 45.4%, indicating a strong return on capital deployed by the company. Britannia has strong cash flow generation with the OCF/EBITDA ratio at 73.8% while OCF/NI stands at 99.3% as of FY2021. It trades at a P/E of 46.8x which is justified given the strong growth prospects the company has.

The company faces risk from any changes in trends towards its product offerings such as a trend wherein people move away from biscuits towards other products, thereby affecting the business of the company. Another risk the company faces is from any changes in food regulations which might cause it to change its ingredient and product mix, thereby possibly affecting its margins earned. Any impact on the input costs, such as volatility and rise in grain prices can also have an adverse impact on the company profits and result in business slowdown as well.

Watch our video on how to analyse and pick Growth stocks for investments

Model Portfolio

In order to get an exposure to best stocks for the long term, you need a total of ₹86,000 for the below curated portfolio as of 18th June, 2021.

COMPANY NAME

WEIGHTAGECMP (18th June, 2021)NO OF STOCKSAMOUNT
Deepak Nitrite22%1,754.801831,586.40
Bharat Rasayan20%12,336.65112,336.65
KEI Industries20%702.12618,254.60
Bajaj Finance14%6,087.00212,174.00
Britannia Industries24%3,619.20310,857.60
100%85,209.25

The below table covers some of the most important factors while evaluating Growth stocks such as return ratios including RoE and RoCE, operating margins, sales and earnings growth and market cap among others.

COMPANY NAMENSE CODEBSE CODECMP (18 June’21)INDUSTRYRATINGMARKET CAP (INR CR)NET WORTH (INR CR)P/EOPM (%)ROEROCEREV GROWTH (5-YR) (%)NI GROWTH (5-YR) (%)DEBT/EQUITYP/BP/S
Bajaj FinanceBAJFINANCE500034₹ 6,087.0Finance (NBFC)5₹ 3,67,410.9₹ 36,918.4183.158.912.779.3229.628.153.579.9513.78
Britannia IndustriesBRITANNIA500825₹ 3,619.0Packaged Food3₹ 87,175.1₹ 3,547.6646.819.146.8945.369.417.540.5924.576.64
Muthoot FinanceMUTHOOTFIN533398₹ 1,472.0Finance (NBFC)5₹ 59,072.1₹ 15,575.0315.580.327.7715.5418.536.113.243.795.12
Petronet LNGPETRONET532522₹ 226.0Oil Marketing & Distribution2₹ 33,877.5₹ 11,806.9011.518.125.6428.9-0.827.980.282.871.3
Coromandel InternationalCOROMANDEL506395₹ 877.0Fertilizers3₹ 25,738.1₹ 5,150.5919.414.228.0832.964.431.110.0751.81
Polycab IndiaPOLYCAB542652₹ 1,936.0Electrical Equipment0.5₹ 28,879.4₹ 4,753.943313.120.3624.811.436.450.046.073.24
Gujarat State PetronetGSPL532702₹ 325.0Utilities3₹ 18,351.0₹ 6,390.7711.43128.538.5163.428.130.242.871.59
Deepak NitriteDEEPAKNI506401₹ 1,755.0Commodity Chemicals0.5₹ 23,934.3₹ 2,346.6530.928.639.640.112664.830.2310.25.49
Avanti FeedsAVANTIFEED512573₹ 583.0Food Products3₹ 7,943.1₹ 1,616.8621.112.426.0736.6419.224.170.014.911.97
Alkyl AminesALKYLAMINE506767₹ 3,529.0Specialty Chemicals2₹ 18,011.0₹ 792.456134.544.4456.6220.842.760.0322.7314.5
Caplin Point LabsCAPLIPOINT524742₹ 653.0Pharmaceuticals0.5₹ 4,941.0₹ 1,185.8320.43124.3330.7734.839.620.024.174.66
IOL ChemicalsIOLCP524164₹ 621.0Pharmaceuticals0.5₹ 3,643.0₹ 1,260.438.230.143.0654.3727.767.3502.891.85
Bharat RasayanBHARATRAS590021₹ 12,337.0Argochemicals0.5₹ 5,243.1₹ 645.163420.332.9134.2322.638.20.058.124.8
KEI IndustriesKEI517569₹ 702.0Electrical Equipment0.5₹ 6,308.8₹ 1,778.0523.11116.6421.4812.234.310.163.551.51

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Top 8 Stocks पूरा Business Online - High Growth Stocks in India - Investaru

13 stocks that have been rising for the past 10 years. Will they continue?

Buying stocks that can rise multifold in a short period is every investor's dream. But it is not easy to spot such stocks. Of all the companies listed on the Bombay Stock Exchange, only 13 have given positive returns in all years since 2004 (except for 2008, the year of the global financial crisis).

However, the key question is whether these 'Fabulous 13' be able to sustain this run ? Can their past performance be used to predict their future growth?

We analyse these companies to find out why their stocks have been so buoyant and that too for such a long period. Here is a snapshot of each along with a SWOT (strength, weakness, opportunities and threat) analysis.

SUPREME INDUSTRIES

The company is one of India's largest plastic processors. It has been growing at a fast pace for the past 10 years due to steady rise in the proportion of value-added products in the portfolio and expansion of the distribution and production network (it has 2,000 channel partners). The operating profit margin of value-added products is more than 17%.

The stock has risen 19 times between 31 December 2003 (Rs 21.92) and 31 December 2013 (Rs 425.35).

"Supreme Industries' decision to move from commoditised products (which can be easily produced) to technologically-advanced products has contributed to its outstanding performance over the years," says Jaipal Shetty, research analyst, Maximus Securities.

Supreme has been increasing net profit at the rate of 22.8% a year on an average for the past five years. It reported a net profit of Rs 272 crore for the year ended June 2013 as against Rs 97.39 crore for the year ended June 2009. The return on equity, or RoE, rose from 9.40% in 2003 to 37.79% in 2013. The strong balance sheet had Rs 22.76 crore cash in hand and bank in June 2013. The company, say experts, looks like a good bet considering its history of efficient capital allocation, excellent distribution network, good brand recall, decent record of developing products and an innovative product line-up.

"We feel the company will be able to at the very least maintain its current growth rate for the next five years provided oil prices do not rise much and India's economy recovers," says Shetty.

On March 31, the stock was at Rs 499 with trailing 12 months price-toearnings, or PE, ratio of 22.52 compared to the industry average of 14.98. The stock has risen 43% since October 2013 in spite of the company reporting weak numbers in the second quarter. The management has cut revenue growth guidance for the financial year from 22% to 20-22% and volume growth guidance from 12% to 9-10% because of weak demand. "But the stock is trading at a slightly high PE multiple," warns Shetty.

CRISIL

CRISIL has been giving huge returns to investors for the past 10 years primarily due to its robust business model. It has been able to successfully diversify into the non-rating business with a series of acquisitions.

CRISIL's RoE has almost doubled from 20% to 40% in the past ten years. Moreover, it has been paying good dividends. Growth in revenue and net profit has been consistently high.

The stock rose 2,090% between 31 December 2003 (Rs 55) and 31 December 2013 (Rs 1,207). In 2008, it had fallen 32.9%. "Share buyback, high dividend payouts, inorganic growth, robust business model, backing of a foreign parent and high return ratios have been driving the stock for the last 10 years," says Silky Jain, research analyst, Nirmal Bang Securities.

Operating profit rose 32% a year on an average between 2005 and 2013. Net profit was Rs 312.57 crore in the year ended December 2013 as against Rs 32.41 crore in the year ended December 2005. Jain expects healthy revenue and net profit growth to continue.

"One can remain remain invested in this market leader. With recovery in the economic environment, the expansion of the sector will lead to faster growth and better returns." On March 31, the stock was at Rs 1,229.30, with a PE ratio of 30.89 as against the industry figure of 26.72.

LA OPALA RG

La Opala was set up in 1988. In 1999, Radha Glass and La Opala merged to become La Opala RG. The company makes glass and glass products. It exports 85% of its crystal ware production.

La Opala RG has 125 distributors and 10,000 dealers.

Gokul Raj, executive director and head of investments, HBJ Capital, says La Opala has been the beneficiary of the rise in aspirational spending by Indians over the last decade. The stock returned 47.7% a year on an average between 2003 and 2013.

Factors driving growth are urbanisation, rising demand for branded kitchenware and increasing competitiveness of Indian products against imports from China.

"The exceptional returns of the past decade are a function of strong earnings growth and valuation re-rating," says Gokul Raj.

While revenues have been growing at 16% a year, operating profits have been rising at 32% a year. The latter is due to high margins and capacity utilisation (fixed asset turnover has improved from 1.7 times to over 2.6 times over the last decade).

Gokul Raj expects 15-20% annual revenue and profit growth over the next five years. The reasons are higher utilisation of the recentlyexpanded capacity and rise in exports.

The stock has undergone a sharp re-rating, especially over the last three years, due to improvement in the quality of growth. The Ebitda to capital employed ratio has shot up from 15% to 50% over the last five years. Ebitda, or operating profit, is earnings before interest, tax, depreciation and amortisation. "Leaders of niche consumption segments that have been able to grow fast over the past five years have been re-rated. This has helped La Opala to also deliver fantastic returns," says Gokul Raj.

On March 31, the stock was at Rs 708.50 with a PE ratio of 27.05. It is expensive as the industry PE is just 16.50. Gokul Raj is not positive on the stock. "The current valuation of 10 times the book value and more than 26 times forward PE is high and factors in all the positives. Valuation re-rating is not likely and hence our base case scenario is 15% rise in the stock price. While earnings growth of 15-20% can continue to push up the stock, the risk of negative earnings surprises has increased due to moderation in consumption growth. In view of the sharp rise over the last five years and expected earnings, we believe that the risk-reward equation is not favourable for investing in the stock at current levels."

CERA SANITARYWARE

Consumer spending in India has been rising at a scorching pace over the last 10 years. This is reflected in the top line and operating performance of Cera Sanitaryware. Net profit has been rising by 40% a year and stock by 54.5% a year on an average for the last 10 years (it rose from Rs 9.1 on 31 December 2003 to Rs 701.50 on 31 December 2013).

Twinkle Gosar, equity research associate, mid-caps, Angel Broking, says, "Growth in consumer demand encouraged Cera to expand its sanitary ware division in 2006-07. We expect top line and profit growth of 25% and 15%, respectively, a year in the coming four-five years."

Operating performance has been stable (margins above 17%) while top line has been growing above 40% a year on an average for the last five years.

The stock has risen 283% in the past two years; it was at Rs 890.70 on March 31 (PE ratio of 24.24). "Despite expectation of robust performance, the company is expected to deliver an annual return of 15% for the next five years. The stock has risen sharply in the past two-three years," says Gosar.

BOSCH

Bosch is a leading supplier of technology and services in the areas of automotive/industrial technology, consumer goods and building technology. Its stock has been rising by 20% a year on an average for the last 10 years. It was at Rs 10,087 on 31 December 2013.

Bosch, a global leader in diesel fuel injection technology, commands 80% share of the domestic diesel systems market. In this it has been helped by fast growth in demand for tractors and commercial vehicles and introduction of the anti-lock braking technology in 2010. Other factors are pricing power in fuel injection systems and spark plugs, rising demand for diesel vehicles (55% sales in 2012-13), wide product portfolio which insulates the company from cyclical factors and long relationship with major original equipment makers. Also, the non-auto business grew 20% a year between 2011 and 2013.

Bosch recently launched the energy solutions business, which signals intent to expand the non-auto business.

The company has been increasing revenue and net profit at the rate of 14.25% and 13% a year, respectively, on an average for the past eight years. Experts say such high growth is likely to continue due to revival in commercial vehicle and tractor segments, demand for diesel engines due to low price of the fuel, traction in the non-auto business and implementation of new emission norms in 2015.

Cholamandalam Securities says revenue will grow 14% a year and net profit 16% a year between 2013 and 2018 due to higher localisation and favourable product mix.

On April 1, the stock was trading at Rs 10,858, with PE ratio of 38.20 as against the industry PE of 21.72. Cholamandalam says Bosch is trading at a premium of 50-60% to other auto ancillary companies. The high valuation, it says, is justified given the company's access to expertise of parent, leadership in diesel fuel injection technology, high return ratios and ability to maintain growth even in tough times. The stock can give 15% a year return in the next five years.

BUTTERFLY GANDHIMATHI APPLIANCES

The maker of home appliances was the first in India to introduce stainless steel pressure cookers and vacuum flasks. Product range includes LPG stoves & mixer grinders. The stock has returned 65.9% a year on an average in the last 10 years.

The company, which was referred to the Board for Industrial and Financial Reconstruction due to financial troubles, has managed to increase operating profit margin from 4.6% in 2005-06 to 9.5% in 2012-13 and reduce the debt-to-equity ratio from 2.1 in 2007-08 to 0.2 in 2012-13. It plans to become debt-free over the next two to three years. In March 2012, Reliance Alternative Investments Fund picked up a 13.7% stake in the company for Rs 100 crore.

The top line has grown 57.62 a year on an average for the last eight years; it was Rs 807 crore in the year ended March 2013. Net profit was Rs 33.42 crore in the year ended March 2013 as against a loss of Rs 3.36 crore in the year ended March 2005.

"We expect branded sales to grow at 15-20% per annum for the next five years. The company is hopeful of expanding margins as its turnover crosses Rs 1,000 crore. However, we expect flat margins in the near term due to rise in promotional expenses in non-south markets," says Dhvani Bavishi, analyst, ICICIdirect.com.

Bavishi is bullish on the stock. "Due to stable top-line growth, we expect a 15-20% price rise over the next 12-18 months." On April 1, the stock was at Rs 293.80.

BATA INDIA

The stock has given a return of 33% a year on an average for the past 10 years. One reason is the massive restructuring at the company, including halving of the head count, which has led to fast growth in profitability.

Bata India has saved a lot in employee cost in the past few years, says Gaurang Kakkad, vice president, institutional research, Religare Capital Markets. "The cost, around 20% of sales in 2004-05, is now 10% of sales Almost 10% margins are on account of savings under this head. Shift to premium products has also helped," he says.

The company reported an operating profit margin of 17.10% for the year ended December 2013 as against 4.71% in the year ended December 2005. Net profit grew from Rs 12.49 crore to Rs 190.74 crore during the period.

Kakkad is positive on the stock. "We expect 17-18% growth in revenue and 20% in profit per year over the next five years. One can expect 15-18% return from the stock in the next 12-18 months." On April 1, it was at Rs 1,131.

AMARA RAJA BATTERIES

Amara Raja is among the pioneers of maintenance-free batteries in India, something that has catapulted it to the second position in the Indian automotive battery market in a short period. The company continues to be a leader in introduction of new technologies in the automotive and industrial battery space. One of its biggest strengths is the technology tie-up with global battery maker Johnson Controls, which owns 26% equity in the company.

The stock has risen 48% a year on an average between 2003 and 2013. "One reason for such spectacular growth has been the shift in demand towards branded batteries. Other reasons could be rapid increase in market share in automotive and industrial segments. The company has managed to retain margins even as its increased sales rapidly due to the strength of its product mix," says Vikram Dhawan, director, Equentis Capital.

In the past 10 years, net profit and sales have been rising 44% and 33%, respectively, a year on an average. Net sales and net profit were Rs 2,961 crore and Rs 286.7 crore, respectively, in the year ended March 2013.

"We expect profit and revenue growth of 20-25% a year for the next five years. The stock is likely to be a clear outperformer in the next few years. One can expect 15-20% annual returns in the next two-three years on the back of earnings per share growth, healthy operating margins and improvement in the country's economy," says Dhawan.

On April 1, Amara Raja was trading at Rs 386, a PE ratio of 19.

GOODYEAR INDIA

The company's financials have been improving for the last ten years. Ten years ago, it had huge debt and was making losses. Now, the debt is zero while profits are soaring. One trend that has helped Goodyear is growth of the automobile industry, more specifically tractor and passenger car segments, its main focus (98% offtake).

New products and launch of a retail outlet are the other factors that have helped the company report decent growth.

The stock has returned 22% a year on an average in the last 10 years. Vijay Dave, senior research analyst, Sunidhi Securities, says, "The stock is attracting investors due to improvement in the company's fundamentals, high dividend payouts, fall in rubber prices and the company's MNC status."

In the last five years, revenue and net profit have grown at a compounded annual growth rate of 11% and 24%, respectively. DK Aggarwal, chairman and managing director, SMC Investments and Advisors, says, "In 2013, the performance improved significantly due to higher margins on account of favourable rubber prices. As the economic situation improves, revenue and profit growth are expected to rise further."

At Rs 418.45, the stock is trading at a PE of 10.26, close to its five-year average of 9.52. Thus, it is fairly priced. "Falling rubber prices, rising incomes in rural areas and topping out of interest rates will benefit the company. One can expect 15-20% annualised return in the future too," says Aggarwal. An Angel Broking report in March 2014 said the stock could hit Rs 472 in the next 12 months.

SUN PHARMACEUTICAL INDUSTRIES

The stock rose 34.3% a year on an average between 2003 and 2013.

Edelweiss Financial Services says high growth in earnings per share and stock price has been due to various acquisitions and leadership in the chronic ailment space.

Net sales and profit have been growing at 10% every year since 2003. Edelweiss expects 20% growth every year for the next three years. The stock is trading at a premium to peers, mainly due to higher return ratios and margins. Analysts expect rise in competition for some of Sun's most profitable brands. This, they say, will make it difficult for the company to sustain returns.

On April 1, the stock was trading at Rs 573.35.

Sun recently entered into an agreement to acquire 100 % of Ranbaxy in an all-stock transaction. Ranbaxy shareholders will receive 0.8 share of Sun Pharma for each share of Ranbaxy. The exchange ratio represents an implied value of Rs 457 for each share of Ranbaxy. The combination of Sun Pharma and Ranbaxy will create the fifthlargest specialty generics company in the world and the largest pharmaceutical company in India.

Rahul Sharma, analyst, Karvy Stock Broking, says, "The deal could be accretive in the long run as Sun Pharma has a track record of turning around acquired companies. We cut our earnings per share estimates by 5% to Rs 30.4 for 2015-16. We roll over our price target to 2015-16 from December 15. We reduce our price target by 5% to Rs 684 based on 22.5 times 2015-16 earnings."

TTK PRESTIGE

Consumer durables industry does well during periods of high economic growth. This is more so in an emerging market like India where ownwership of white and grey goods is low. During the boom years of 2004-11, thanks to exploding discretionary incomes, the industry did spectacularly well.

TTK Prestige reported a remarkable spurt in sales from Rs 339 crore in 2007-08 to Rs 1,385 crore in 2012-13. The net profit rose from Rs 20.67 crore to Rs 133.09 crore during this period. Earnings per share zoomed from Rs 17.64 to Rs 114.29, pushing the stock to dizzy heights.

VK Vijayakumar, investment strategist, Geojit BNP Paribas Financial Services, says, "The explosive growth in top line and bottom line was reflected in the stock price. The market rewarded the performance by a higher PE ratio."

TTK Prestige has returned 70.5% a year in the last 10 years. "It will be unrealistic to expect such returns in the immediate future. Investors should temper expectation to a more reasonable 25% in the next five years," says Vijayakumar.

ITC

Stock markets were under a lot of pressure in the last few years. That's why investors took refuge in defensive sectors, the ones that are not as prone to slowdown as others. One such sector was fast moving consumer goods. That's the biggest reason for the 25.5% a year return given by the ITC stock in the past ten years.

Sudip Bandyopadhyay, president, Destimoney Securities, says, "Tobacco business is a cash cow for ITC. It is also recessionproof. It helped the company report fast earning growth during the period. I expect 15% revenue and 8-10% net profit growth every year for the next five years."

Sales rose from Rs 5,865 crore in 2003 to Rs 41,810 crore in 2013. Net profit rose from Rs 1,371 crore Rs 7,418 crore. On April 2, the stock was trading at Rs 344.25, with a PE ratio of 32.46 as against the industry average of 31.93.

"At present, ITC is reasonably valued and one can expect 10-15% annualised return for the next five years."

SHRENUJ & COMPANY

The company makes polished diamond and jewellery products. The market capitalisation is Rs 900 crore.

The stock has returned 25.6% a year on an average in the past 10 years. It was at Rs 99.6 on 31 December 2013 as against Rs 10.20 on 31 December 2003.

Nikhil Kamath, director, Zerodha, says, "A bullish diamond market is the biggest reason for Shrenuj's stellar performance. We expect revenues to grow by 10% annually. The stock looks fairly valued at current levels with PE of three. We can expect annualised returns of 15% for next five years. However, the stock is a fairly illiquid, and so entering and exiting will be fairly convoluted." On April 2, Shrenuj and Company was trading at Rs 93.70.

Sours: https://www.businesstoday.in/magazine/stocks/story/stocks-rising-for-10-years-will-they-give-good-returns-still-46981-2014-05-23

In india growing stocks fastest

The Economic TimesET Markets
| 22 October, 2021, 02:59 PM IST | E-Paper
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As on 02:59 PM | 22 Oct 2021

NSE Top Gainers Today - View the stock market Top Gainers Live data for BSE & NSE in the duration of 1 day, 1 week, 1 month, 3 months, 6 months and 1 year on The Economic Times. NSE/BSE Top Gainers
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Top 4 Fastest Growing Stocks - Best 4 Stocks for Long Term - Consistent Compounders

fastest growing companies stocks
In recent quarters, many companies have struggled to report some good earnings. Covid led lockdown had a significant impact on them. But on the other hand, there are several companies whose earnings have actually seen an improvement or say growth in covid period too!

In fact, their is an accelerated growth in the businesses of some companies. Growth in financials of these companies has been superb in recent time. Reacting on this accelerated growth, shares of these companies have already given Multibagger returns in last 1 year.

If these companies continued to perform and kept growing at a faster pace for some more time, it can help share prices of companies to reach a new height!

So what are the names of these fastest growing companies??

Before we see the names, let me tell you that these stocks have been filtered. Only those stocks have been added here where growth in financials has been from Top to Bottom! In other words, growth has appeared in both Revenue and Profit generated by the company.

Additionally, only those names have been added whose Market Capital is atleast Rs 5,000 crore! For a Low Market Cap company, it can be little easy to rise multifold times. But for a Mid Size company, rising more than 100 percent is not always easy unless the firm has achieved some solid growth.

One more thing.

Before you see the list, it is important to know how the data has been presented in the list. Here are the details of it

In columns, REV means Revenue and PAT means Profit. Quarter 1(2022) is period of April to June of 2021 year. Similarly, Quarter 1(2021) is period of April to June of 2020 year. Compare Quarter 1(2022) with Quarter 1(2021) to see the YoY Growth. FY2021 period is of April 2020 to March 2021. FY2020 period is of April 2019 to March 2020. Compare FY2021 with FY2020 to see the Growth.

So finally, here is the list of Companies or Stocks that have grown at a faster pace in terms of business financials and share price both in past one year.

 

List of Fast Growing Companies / Stocks in India

Company NamePast 1 Year ReturnsQuarter1(2022)Quarter1(2021)FY2021
FINANCIALS
FY2020
FINANCIALS
Alkyl Amines233%REV—392
PAT—79
REV—245
PAT—53
REV—1,242
PAT—295
REV-993
PAT-215
Tanla Platforms230%REV—626
PAT—104
REV—456
PAT—79
REV—2,341
PAT—356
REV—1943
PAT—(-211)
Lux Industries172%REV—415
PAT—65
REV—316
PAT—38
REV—1,938
PAT—273
REV—1,203
PAT—126
Laurus Labs141%REV—1,278
PAT—241
REV—974
PAT—172
REV—4,814
PAT—984
REV—2,832
PAT—255
CDSL178%REV—117
PAT—64
REV—65
PAT—46
REV—344
PAT—200
REV—225
PAT—106
Dixon Technologies160%REV—1,867
PAT—18
REV—517
PAT—2
REV—6,448
PAT—160
REV—4,400
PAT—120
Astral158%REV—700
PAT—74
REV—404
PAT—20
REV—3,176
PAT—404
REV—2,578
PAT—248
Apl Apollo Tubes259%REV—2,534
PAT—147
REV—1,110
PAT—17
REV—8,500
PAT—360
REV—7,723
PAT—238
Persistent Systems219%REV—1,230
PAT—151
REV—991
PAT—90
REV—4,188
PAT—451
REV—3,566
PAT—340
Apollo Tricoat210%REV—582
PAT—48
REV—171
PAT—9
REV—1,473
PAT—105
REV—663
PAT—42
Balaji Amines506%REV—451
PAT—90
REV—223
PAT—33
REV—1,308
PAT—238
REV—935
PAT—105
Mastek275%REV—516
PAT—69
REV—386
PAT—40
REV—1,722
PAT—209
REV—1,071
PAT—109
Gland Pharma114%REV—1,154
PAT—351
REV—884
PAT—314
REV—3,463
PAT—997
REV—2,633
PAT—773
Angel Broking352%REV—463
PAT—121
REV—238
PAT—47
REV—1,289
PAT—297
REV—748
PAT—82
BASF147%REV—3,013
PAT—197
REV—1,786
PAT—(-31)
REV—9,558
PAT—553
REV—7,595
PAT—23

 

So, these were the Top stocks where High Growth in financials in covid period too has supported their prices to reach a new height.

There are some stocks where even after achieving good growth, share prices are not able to move much. But in these stocks, investors have positively reacted on the growth. Better growth has caused increased demand of these shares among investors which is aiding the share price growth too.

Some more names of Fast Growing Companies

In above list, some stocks where business performance and growth rate have been great were not added because they were not meeting some criterias used to make the list. Here are the names of these companies

  • Affle India
  • Metropolis Healthcare
  • Gujarat Gas
  • Shyam Metalics
  • Anupam Rasayan
  • Nazara Technologies

From them, some are recent IPOs whose Past 1 years are not visible for now. Gujarat Gas was not able to meet all growth criterias used to select the names for the Fastest Growing companies list.

Stock performance of companies like Affle India, metropolis healthcare has not been at par with companies mentioned in the list. Their past 1 year returns are less than 100%.

This has been used as the criteria to add names in the list of Fastest Growing Shares. Past 1 year returns should be atleast 100%.

 

Now, let’s see some questions that might come to your mind after discovering these names of fast growing stocks.

 

What are the chances of these Fast Growing Stocks to perform in Future?

If mentioned companies continued to show encouraging growth in financial numbers in future too, then prices of these stocks are also expected to see a good rise in future. Growth Potential in these stocks has still not peaked yet. That means, efforts of management can still push the Financial numbers or Business of these Growth companies to new heights.

Is there any High Risk in these Fast Growing Companies?

Generally, when a stock is in a phase of High Growth, their PE or Price to Earning Ratio might see some kind of re-rating. In other words, it might see some expansion in figure.

Say ABC stock trades around 20 PE during its slow growth phase. Then, it doesn’t necessary that stock will still be trading with 20 PE when the phase will be of High Growth. PE could reach to 30, 40 or more higher figure on the back of high demand of share among investors.

When ABC company would again move to slow growth phase, the PE (Valuations) might also see some decline and move to 20 levels again. When this thing happens, share price could see some significant decline or correction in the price compared to what is happening in the financials.

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That is the end of this post. Hope it helps you somewhere.

Good Luck : )

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