At the time when interest rates are hovering at their record low levels, it looks difficult for investors to accumulate wealth through fixed deposits. On the other hand, the stock market has plenty of options that can help you to get superior returns than other asset classes.
Take this: at least eight stocks on Dalal Street have been doubling investors' money every four years. Before going ahead, here is a disclaimer that past performance does not guarantee the future price movement of stocks. Therefore, investors should consult their financial advisors before taking any positions.
Coming back to the consistent compounders, Vinati Organics emerged as the top grosser in the list. Shares of the company jumped 1,129 per cent during November 2005 and 2009. It climbed 179 per cent (Nov 2009-13), 482 per cent (Nov 2013-17) and 305 per cent (Nov 2017-21). Overall, shares of the company have gained 80,906 per cent during the past 16 years.
The company was established in 1989 to manufacture specialty organic chemicals. It has since grown to become the world's largest manufacturer of IBB (Iso butyl benzene) and ATBS (2-acrylamido 2 methylpropane sulphonic acid) and India's largest manufacturer of IB (Iso-Butylene) and HP MTBE (High Purity-Methyl Tertiary Butyl Ether). The company's products are exported to customers in countries across Europe, America, and Asia.
Vinati Organics also commands over 65 per cent market share in the world for IBB. With consistent investments in technology and capacities, the company is the largest producer of IBB in the world with a capacity of 16,000 tonnes per annum. It has shown robust growth in its financials during the past 16 years. Where net sales of Vinati Organics witnessed an annualised growth of 20.46 per cent since FY2005, the net profit of the company has grown at CAGR of 32 per cent.
Cholamandalam Securities is positive on Vinati Organics with a 12-month price target of Rs 2,145. "We expect, ATBS to drive overall revenue growth and profitability. Further, better off-take from new products and integration of Veeral additives will add to this momentum. With upbeat guidance from the management we have revised our top line estimates higher," the brokerage said.
Footwear major Relaxo Footwears is next on the list. The scrip gained 388 per cent during November 2005-09, 302 per cent (Nov 2009-13), 581 per cent (Nov 2013-2017) and 364 per cent (Nov 2017-21). Overall, shares of the company have soared 61,858 per cent to Rs 1332.10 on November 18, 2021. Brokerage Sharekhan is positive on the company with a price target of Rs 1,490.
Of late, Relaxo's Q2FY22 performance was affected by the sharp increase in raw material prices, resulting in around a 9 per cent fall in profit after tax. Its revenue grew by 24.1 per cent year-on-year to Rs 714.4 crore. Revenues rose strongly led by demand recovery due to opening up of the stores across geographies, strong rebound in economic activity, resulting in business returning to pre-COVID-19 levels. It has taken relevant steps to reduce stress on gross margins in the coming quarters. As of September 30, 2021 the company has more than Rs 200 crore cash on its books.
"With a strong portfolio of value-for-money footwear products and expansion in distribution reach (especially in southern markets), Relaxo is well poised to achieve revenue and earnings CAGR growth of 18 per cent each over FY2021-FY2024E. It has a strong balance sheet with good cash generation ability," Sharekhan said in a report.
Borosil Renewables, Acrysil, Asian Paints, Torrent Pharmaceuticals, Pidilite Industries and Titan Company stood among the rest of the players which also doubled investors' money every four years. (See table).
YES Securities is bullish on Acrysil with a price target of Rs 1,150.
"With Acrysil being one of the only four global manufacturers of Quartz sinks via German technology, we expect Acrysil to report volume growth of 33 per cent CAGR over FY21-24E. Owing to strong demand, the company has announced another capex of 2L Quartz sinks which will be operational by Q2FY23, taking the total Quartz sinks capacity to 1.2 million. Acrysil is also expanding their stainless steel capacity from 90,000 units to 1,80,000 units by Q4FY22 which should further boost the company's topline," YES Securities added.
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