Multibagger stocks with high promoter holding
Your best friend is the person you look for when you want to share a secret.
You tell your secrets to your best friend because you trust them. When you trust someone, you automatically place high expectations on them. This is the nature of trust from a social point of view.
In the financial markets, confidence is seen among promoters having a high stake in their company. Promoter’s holding is a sign of trust.
Imagine, a company is trusted by its promoters, (high promoter holding), it has great growth potential (it is a smallcap), and has delivered a multibagger return!
That would be rare, wouldn’t it?
So, in this article, we talk about these rare stocks.
This article may be your answer How to Invest in Multibagger Shares who are fundamentally strong. High promoter holding is one of the characteristics of fundamentally strong stocks.
Read on to know which 5 smallcap, multibagger stocks have the highest promoter holding.
#1 Adani Power
First on our list is Adani Power, one of the lesser-known star players Adani Group,
Adani Power is an Indian electricity and energy company, a subsidiary of the Indian conglomerate Adani Group, with head office at Khodiyar in Ahmedabad, Gujarat.
It is a private thermal power producer with a capacity of 12,450 MW. It also operates a 40 MW mega solar plant at Naliya, Bitta, Kutch, Gujarat.
Promoters hold a major stake in Adani Power. Since September 2020, the promoters have maintained around 75% stake in the company.
Out of 75% holding, 46% of the shares are held by Indian promoters, and 29% shares are with foreign promoters.
How has the company’s stock performed in the stock markets?
Adani Power investors are very happy. Adani Power’s share price has risen 310 per cent in the last one year.
This means that if you had invested Rs 1 million in Adani Power a year ago, you would have Rs 3.1 million today!
The stock was behaving in a range bound pattern till February 2022. However, after that the shares of Adani Power rose as there is no tomorrow.
In its latest quarterly results, Adani Power reported a 16-fold increase in consolidated profit at Rs 47.8 billion, backed by a healthy top line and other income.
Consolidated revenue from operations grew 109% year-on-year to Rs 137.2 billion.
Adani Power has been in focus due to the growing interest for renewable energy stocks. company is one of them Top Renewable Energy Stocks in India,
#2 BLS International Services
BLS International Services is an Indian outsourcing service provider to government and diplomatic missions across the world.
The company manages visa, passport, consular, verification and civilian services for client governments and diplomatic missions in Asia, Africa, Europe, South America, North America and the Middle East.
It also provides civic services to the state and provincial governments.
The promoters hold a major stake in BLS International Services. In December, the promoters had retained a high stake of 74.4% in the company. Their total stake increased to 74.6% in June 2021.
As of 30 June 2022, the promoters’ total holding is 74.6%. All the shares are with the Indian promoters.
So, how has the stock of BLS International Services performed in the stock markets?
In 2022, BLS International Services has grown by 144%. In the past one year, the company’s shares have risen by 50%.
Recently, the company announced that it has partnered with UTI Infrastructure Technology and Services (UTIITSL) to support e-card printing services for the Government of India.
The company is now officially PMJAY service agent.
It is also authorized by the Royal Thai Embassy to provide visa services in Chennai.
The company will provide Thai visa application services. It will also provide many value-added services such as form filling assistance, SMS tracking, photocopying and printing, travel insurance and courier services.
#3 Gujarat Mineral Development Corporation
Gujarat Mineral Development Corporation (GMDC) is a leading Indian state-owned mineral and lignite mining company based in Ahmedabad.
GMDC was established in 1963. Its product range includes essential energy minerals such as lignite, base metals, and industrial minerals such as bauxite and fluorspar.
Promoters hold a major stake in GMDC. For a long time he held 74 per cent stake in the company. All the shares are with the Indian promoters.
How has the stock performed on the stock markets recently?
GMDC investors are rolling in the money. The share price of GMDC has increased by 170% in the last one year. This means that if you had invested Rs 1 million in GMDC a year ago, you have Rs 1.7 million today!
For the March 2022 quarter, the mineral miner reported a net profit of Rs 1.7 billion. The company had posted a consolidated loss of Rs 1.8 billion in the year-ago period.
This was behind the increase in revenue. The company’s consolidated income rose to Rs 11 billion from Rs 6.1 billion in the same period a year ago.
#4 Bharat Dynamics
Bharat Dynamics (BDL) is one of the manufacturers of ammunition and missile systems in India. It was established in 1970 in Hyderabad, Telangana, India.
BDL was established as a manufacturing base for guided weapon systems and started with a pool of engineers drawn from Indian Ordnance Factories, DRDO and aerospace industries. It began with the production of the first generation anti-tank guided missile – the French SS11B1.
Promoters hold a major stake in BDL. For a long time he has held 74.9% stake in the company. All the shares are with the Indian promoters.
How has Bharat Dynamics stock performed in the stock markets?
Patience bears sweet fruits. Investors of Bharat Dynamics know this very well.
The share price of BDL was range bound as of February 2022. However, the share price picked up after February 2022.
BDL’s stock has gained 136 per cent in the last one year. On a YTD basis, the share price has risen 126%. This is just 10 per cent less than the full year growth.
The company recently got an order worth Rs 29.7 billion from the Defense Ministry.
The contract is for the supply of Astra Mk-I Beyond Visual Range air-to-air missile and allied equipment to the Air Force and the Indian Navy.
#5 Schaeffler India
Schaeffler India formerly known as FAG Bearings India is one of India’s leading ball and rolling bearing manufacturers serving the automotive and multiple core industrial segments.
The company caters to all major industry sectors including Construction, Machinery, Electrical Engineering, Fluid Technology etc.
Promoters hold a major stake in Schaeffler India. For a long time he has held 74.1% stake in the company. All the shares are with foreign promoters.
So, how have the shares of Schaeffler India performed on the stock markets?
The share price of Schaeffler India is rising in the stock markets. Share price rose 122% in last 1 year. On a YTD basis, the share price has risen 69%.
Earlier this month, Schaeffler India inaugurated its largest consolidation and distribution center in Hauser. The warehouse covers an area of 100,000 square feet and is Schaeffler’s largest outdoor warehouse in the Asia Pacific region.
investment takeaway
The stock market investor has to be very careful. In the stock markets, pros can turn around and cons can turn at any time.
Small-cap stocks provide high and quick returns because small-cap companies have high growth rates. But these small-cap stocks also carry high risk.
High promoter holding indicates the confidence of the promoter in the company.
Therefore, an investor should be wary of the red flags in the stock, but he should also not be careless about losing the green flag of the stock.
To know more about the green flags and red flags of various stocks, stay tuned to Equitymaster.
Happy investment!
Disclaimer: This article is for informational purposes only. This is not a stock recommendation and should not be treated as such.
This article is syndicated from equitymaster.com