- Date : 30/06/2022
- Read: 3 mins
If you are not conversant with stock market terminology, Multibagger refers to an equity stock that returns multiple times its cost to an investor. In other words, you can earn Rupees three Lakhs in two years by investing one Lakh Rupee in a multibagger stock!
How to Check a Multibagger?
Some of the standard features of a company with high-performing stocks:
- Low Debt level: While there is no standard uniform debt percentage for a company, and it varies from industry to industry, a ballpark measure of low debt is 30% of the equity value.
- Quarter on Quarter Performance: When the analysis reveals a relatively small revenue growth for a company but robust operational performance, it usually indicates a significant upside potential.
- Source of Revenue: High contribution of the company’s primary revenue segment, good scope at the macro or industry level and additionally, if the company’s operations are easily scalable, the chances of the stocks becoming a multibagger are high.
- P/E Growth: When the P/E level is growing faster than the stock price- to check, review the current P/E and Price / Sales ratios on a comparative scale with the trailing 12-month period;
- Multibagger Stocks in India
GRM Overseas Ltd
Segment: Food
Business: Milling, processing, and marketing of branded and non-branded basmati rice in domestic and overseas .market
- Revenue: FY22 –Rs.1171 Crores (up by 45.3% over the previous year); PAT: Rs.84.5 Crores
- Current Share Price: Rs.355.75; Five –year Forecast: Rs. 1221(+ 260% return)
- Share returns
- One Year: 104.3%
- Three Years: 215.7%
Sindhu Trade Links Ltd
Segment: Transportation and logistics
Business: Transportation, Loading and Mining Services, Trading in spares, fuel
- Revenue: Rs.669 Crores –FY 21; Profit: Rs. 62.8 Crores
- Current Share Price: Rs.37; Five –year Forecast: Rs. 241(+ 550% return)
- Share returns
- One Year: 1033.8%
- Two Years: Rs.5.16 (30.4.2020 BSE) to Rs.114.60 (02.05.2022 BSE) 2120%
- Three Years: 1094.2%
Adani Transmission
Segment: Energy
Business: Electrical Utilities
- Revenue: Rs.11861 Crores –FY22; Profit: Rs. 1204 Crores
- Current Share Price: Rs 2315 .15; Five –year Forecast: Rs. 9000(+ 300 % return)
- Share returns
- One Year: 192
- Three Years: 857%
- Five Years: 1630%
Khaitan Chemical & Fertiliser Ltd
Segment: Fertiliser, Chemical
Business: Main products-manufacturer of Superphosphate and Sulphuric acid; also produces crude Soya oil and vegetable oils.
- Revenue: Rs.825 Crores-FY 22, up 71.3% over previous year; Profit: Rs. 79.50 Crores
- Current Share Price: Rs 101.15;
- Share returns
- One Year: 190.3%
- Three Years: 1160.3%
- Five Years: 1543%.
Choosing a Multibagger Stock in 2022
Every investor wants a portfolio full of multi-baggers. While there is no sure-shot formula to identify, a combination of research, understanding the market pulse and some luck leads to choosing a multi-bagger. However, some of the factors to look for are:
- High growth and high return on capital employed by the company
- Positive cash flows
- Allocation of Capital
- Stable management and favourable external environment
Note: Share Price forecast above is based on recommendations of various stock related sites
How to Check a Multibagger?
Some of the standard features of a company with high-performing stocks:
- Low Debt level: While there is no standard uniform debt percentage for a company, and it varies from industry to industry, a ballpark measure of low debt is 30% of the equity value.
- Quarter on Quarter Performance: When the analysis reveals a relatively small revenue growth for a company but robust operational performance, it usually indicates a significant upside potential.
- Source of Revenue: High contribution of the company’s primary revenue segment, good scope at the macro or industry level and additionally, if the company’s operations are easily scalable, the chances of the stocks becoming a multibagger are high.
- P/E Growth: When the P/E level is growing faster than the stock price- to check, review the current P/E and Price / Sales ratios on a comparative scale with the trailing 12-month period;
- Multibagger Stocks in India
GRM Overseas Ltd
Segment: Food
Business: Milling, processing, and marketing of branded and non-branded basmati rice in domestic and overseas .market
- Revenue: FY22 –Rs.1171 Crores (up by 45.3% over the previous year); PAT: Rs.84.5 Crores
- Current Share Price: Rs.355.75; Five –year Forecast: Rs. 1221(+ 260% return)
- Share returns
- One Year: 104.3%
- Three Years: 215.7%
Sindhu Trade Links Ltd
Segment: Transportation and logistics
Business: Transportation, Loading and Mining Services, Trading in spares, fuel
- Revenue: Rs.669 Crores –FY 21; Profit: Rs. 62.8 Crores
- Current Share Price: Rs.37; Five –year Forecast: Rs. 241(+ 550% return)
- Share returns
- One Year: 1033.8%
- Two Years: Rs.5.16 (30.4.2020 BSE) to Rs.114.60 (02.05.2022 BSE) 2120%
- Three Years: 1094.2%
Adani Transmission
Segment: Energy
Business: Electrical Utilities
- Revenue: Rs.11861 Crores –FY22; Profit: Rs. 1204 Crores
- Current Share Price: Rs 2315 .15; Five –year Forecast: Rs. 9000(+ 300 % return)
- Share returns
- One Year: 192
- Three Years: 857%
- Five Years: 1630%
Khaitan Chemical & Fertiliser Ltd
Segment: Fertiliser, Chemical
Business: Main products-manufacturer of Superphosphate and Sulphuric acid; also produces crude Soya oil and vegetable oils.
- Revenue: Rs.825 Crores-FY 22, up 71.3% over previous year; Profit: Rs. 79.50 Crores
- Current Share Price: Rs 101.15;
- Share returns
- One Year: 190.3%
- Three Years: 1160.3%
- Five Years: 1543%.
Choosing a Multibagger Stock in 2022
Every investor wants a portfolio full of multi-baggers. While there is no sure-shot formula to identify, a combination of research, understanding the market pulse and some luck leads to choosing a multi-bagger. However, some of the factors to look for are:
- High growth and high return on capital employed by the company
- Positive cash flows
- Allocation of Capital
- Stable management and favourable external environment
Note: Share Price forecast above is based on recommendations of various stock related sites
