In this article we will discuss:
– What are multibagger stocks?
– Top performing stocks for the past 12 months
– Top multibagger stocks from the past decade
– Sectoral distribution of best multibagger stocks from the past
– How to find multibagger shares in India
– Characteristics of multibagger shares
– Future multibagger stocks for next 10 years
– List of small cap multibagger stocks for 2022
– List of multibagger penny stocks for 2022
What are multibagger stocks?
Wikipedia describes a Multibagger Stock as an equity stock which gives a return of more than 100%.
This term was coined by legendary American fund manager Peter Lynch in his 1988 book One Up on Wall Street.
Lynch was a baseball fan and he borrowed the idea of a multibagger from baseball where ‘bags’ or ‘bases’ that a runner reaches are the measure of the success of a play.
For example, a ten bagger is a stock which gives returns equal to 10 times the investment, while a twenty bagger stock gives a return of 20 times. MRF for example, gave 1651% returns between June 2001 and April 2018 – it can be referred as a 17-bagger stock.
This term was coined by legendary American fund manager Peter Lynch in his 1988 book One Up on Wall Street.
Lynch was a baseball fan and he borrowed the idea of a multibagger from baseball where ‘bags’ or ‘bases’ that a runner reaches are the measure of the success of a play.
For example, a ten bagger is a stock which gives returns equal to 10 times the investment, while a twenty bagger stock gives a return of 20 times. MRF for example, gave 1651% returns between June 2001 and April 2018 – it can be referred as a 17-bagger stock.
Top multibagger stocks for 2021
Year 2021 produced many multibaggers. Below is the list of top 20 stocks that gave highest returns in the past 12 months.
| NSE Symbol | Stock | PNL | Sector |
|---|---|---|---|
| JINDALPHOT | Jindal Photo | 2671% | Finance & Investments |
| NAHARSPING | Nahar Spinning Mills | 1120% | Textile |
| TTML | Tata Teleservices (Maharashtra) | 1061% | Telecom |
| MCDHOLDING | McDowell Holdings | 656% | Finance & Investments |
| TRIDENT | Trident | 515% | Textile |
| ELECON | Elecon Engineering Company | 497% | Capital Goods |
| PARSVNATH | Parsvanath Developers | 471% | Construction |
| SAREGAMA | Saregama India | 462% | Entertainment |
| GOLDENTOBC | Golden Tobacco | 441% | Cigarettes |
| ADSL | Allied Digital Services | 433% | IT |
| TIPSINDLTD | Tips Industries | 422% | Entertainment |
| DBREALTY | DB Realty | 419% | Construction |
| SPTL | Sintex Plastics Technology | 418% | Plastics |
| JSWENERGY | JSW Energy | 387% | Energy |
| MARALOVER | Maral Overseas | 375% | Textile |
| TI | Tilaknagar Industries | 373% | Alcoholic Beverages |
| TNTELE | Tamil Nadu Telecommunications | 369% | Telecom |
| GTL | GTL | 351% | Telecom |
| RPOWER | Reliance Power | 348% | Energy |
| KPITTECH | KPIT Technologies | 345% | IT |
Top multibagger stocks for the past decade
If we look at the past decade (2010-20), then the 20 best Multibagger Stocks based on 10 year absolute returns will be the following:
| Symbol | Stock | Gain | Sector |
|---|---|---|---|
| AJANTPHARM | Ajanta Pharma | 5061% | Pharmaceuticals |
| ASTRAL | Astral Poly | 4614% | Plastic |
| ATUL | Atul | 4120% | Chemicals |
| LAOPALA | LaOpala | 3319% | Glass Products |
| AARTIIND | Aarti Industries | 3127% | Chemicals |
| VGUARD | V-Guard | 2357% | Electrical Equipment |
| BERGEPAINT | Berger Paints | 2268% | Paints & Varnish |
| VINATIORGA | Vinati Organics | 2034% | Chemicals |
| EICHERMOT | Eicher Motors | 2017% | Auto |
| PAGEIND | Page Industries | 1963% | Textile |
| NATCOPHARM | Natco Pharma | 1911% | Pharmaceuticals |
| NAVINFLUOR | Navin Fluorine | 1770% | Chemicals |
| CERA | Cera Sanitaryware | 1675% | Ceramics |
| CANFINHOME | Can Fin Homes | 1643% | Finance |
| ABBOTINDIA | Abbott India | 1593% | Pharmaceuticals |
| SRF | SRF | 1448% | Technical Textile |
| GRANULES | Granules India | 1382% | Pharmaceuticals |
| BRITANNIA | Britannia Industries | 1363% | FMCG |
| BAJAJFINSV | Bajaj Finserv | 1244% | Finance |
Past multibagger stock Ajanta Pharma
Ajanta Pharma has been one of the most successful multibaggers of the past decade generating nearly 50x returns.
In 2012 when I first stumbled across Ajanta Pharma, I was drawn to it purely by its numbers. It had excellent financials, but I had no clue on what it did. Looking up in the Internet revealed it’s a pharmaceutical company (yes, you can tell that by the name) that produces a herbal preparation for kids named “Pinkoo Gripe Water” and sells anti-malarial drugs in Africa. Didn’t ring any bells, but after hesitating for few days I bought some shares of the company in September 2012. Subsequently, I added some more over the next two months (probably after bit more reading).
In 2012 when I first stumbled across Ajanta Pharma, I was drawn to it purely by its numbers. It had excellent financials, but I had no clue on what it did. Looking up in the Internet revealed it’s a pharmaceutical company (yes, you can tell that by the name) that produces a herbal preparation for kids named “Pinkoo Gripe Water” and sells anti-malarial drugs in Africa. Didn’t ring any bells, but after hesitating for few days I bought some shares of the company in September 2012. Subsequently, I added some more over the next two months (probably after bit more reading).
Between September 2012 – when I bought my first share of Ajanta Pharma, and May 2017 – when I sold my last bit– the stock had went up by an astonishing 1361%.
And finally, The 100-baggers
You might be surprised to learn that over the past 10 years alone, multiple stocks have generated more than 100 times returns. Top five names among them in terms of 10Y returns are:
And, if you consider their Inception Till Date (ITD) returns, the numbers are even more astounding:
ITD returns of best multibagger stocks based on 10Y performance:
Characteristics of top multibagger shares
Multibagger shares usually have the following traits:
The Bajaj Finance story
Bajaj Finance started as Bajaj Auto Finance in 1988, primarily as a financing arm of the group’s auto business.
Today it stands out as one of the largest and fastest growing deposit taking NBFC in India with a diversified portfolio of financing businesses covering Retail, SME Rural & Commercial.
Since its IPO listing in FY95, the stock has multiplied by an astounding 124,450%. A casual 1 lakh rupees invested in the IPO is now worth around 1200 crores! (Feel free to double check the number of zeros when you have time )
Today it stands out as one of the largest and fastest growing deposit taking NBFC in India with a diversified portfolio of financing businesses covering Retail, SME Rural & Commercial.
Since its IPO listing in FY95, the stock has multiplied by an astounding 124,450%. A casual 1 lakh rupees invested in the IPO is now worth around 1200 crores! (Feel free to double check the number of zeros when you have time )
The Astral story & our experience
We had been invested in 4 of these 5 100-baggers at one point or another. Yet, like many investors, whenever we look at these stocks today, we feel the pain of missing out.
Astral Limited is a prime example. The company is primarily engaged in manufacturing of plumbing & drainage systems, fittings and adhesive solutions. Roughly 77% of its business comes from Pipes & Fittings, while Adhesives accounts for the rest.
We had identified Atral almost a decade back (it used to be known as Astral Poly Technik then). In one year the stock went up by approximately 5 times. Schooled in the principles of traditional value investing, we exited the stock considering it to be over-valued, waiting for a suitable opportunity to re-enter after correction! As you can imagine, it has been a very long and frustrating wait
Astral Limited is a prime example. The company is primarily engaged in manufacturing of plumbing & drainage systems, fittings and adhesive solutions. Roughly 77% of its business comes from Pipes & Fittings, while Adhesives accounts for the rest.
We had identified Atral almost a decade back (it used to be known as Astral Poly Technik then). In one year the stock went up by approximately 5 times. Schooled in the principles of traditional value investing, we exited the stock considering it to be over-valued, waiting for a suitable opportunity to re-enter after correction! As you can imagine, it has been a very long and frustrating wait
How to spot potential multibagger stocks
So how do you spot a multibagger share?
The usual starting point is to screen the traded stock universe by applying filters in-line with the criteria mentioned before. This will give us an initial list, which can be digged in further.
We look for a highly profitable business with strong cash-flows and low debt that is maintaining a consistent but high growth rate. We translate these attributes into the filter represented below:
The usual starting point is to screen the traded stock universe by applying filters in-line with the criteria mentioned before. This will give us an initial list, which can be digged in further.
We look for a highly profitable business with strong cash-flows and low debt that is maintaining a consistent but high growth rate. We translate these attributes into the filter represented below:
Future multibagger stocks for next 10 years
Running the above screen, we get a list of 45 potential multibagger stocks. These stocks could potentially generate strong returns in future:
| Name | CMP | Mcap Cr. | P/E | PSR | PAT Var 10Yrs | ROE 5Yrs | FCF 5Yrs Cr. |
|---|---|---|---|---|---|---|---|
| Godawari Power | 268.1 | 3781.58 | 3.1 | 0.79 | 22.82 | 21.38 | 2098.15 |
| Kanchi Karpooram | 832.15 | 361.48 | 6.48 | 1.56 | 50.96 | 45.41 | 71.32 |
| Ajanta Soya | 228.8 | 368.29 | 8.28 | 0.3 | 48.99 | 15.99 | 9.03 |
| Dolat Investment | 89.7 | 1577.84 | 8.76 | 5.95 | 55.9 | 39.29 | 362.02 |
| Monarch Networth | 138.85 | 431.12 | 10.35 | 3.97 | 19.52 | 21.34 | 295.12 |
| Nikhil Adhesives | 697.1 | 320.27 | 11.33 | 0.44 | 22.13 | 18.9 | 27 |
| Indo Borax & Ch. | 142.15 | 456.16 | 11.35 | 2.59 | 16.52 | 15.14 | 62.75 |
| JK Lakshmi Cem. | 628.15 | 7393.78 | 14.48 | 1.42 | 21.26 | 10.35 | 2203.85 |
| Triven.Engg.Ind. | 225.65 | 5447.65 | 14.97 | 1.24 | 17.86 | 24.26 | 1364.16 |
| Assoc.Alcohols | 540.35 | 977.27 | 15.17 | 2.04 | 46.08 | 24.92 | 125.79 |
| Sh. Jagdamba Pol | 997.45 | 873.57 | 15.58 | 2.78 | 42.08 | 36.78 | 16.81 |
| High Energy Bat. | 1747.6 | 312.82 | 16.21 | 3.86 | 26.12 | 27.46 | 23.23 |
| Cybertech Sys. | 159.4 | 449.26 | 16.3 | 3.51 | 36.1 | 13.93 | 56.76 |
| Resonance Speci. | 191.35 | 220.82 | 17.54 | 2.85 | 31.9 | 14.9 | 6.43 |
| Avantel | 747.15 | 302.94 | 17.58 | 3.64 | 20.18 | 22.04 | 66.54 |
| Sika Interplant | 753.9 | 319.65 | 18.69 | 3.11 | 28.47 | 11.25 | 29.05 |
| Guj. Themis Bio. | 518.4 | 753.16 | 18.84 | 6.54 | 27.26 | 57.56 | 4.3 |
| Kopran | 259.05 | 1127.76 | 20.81 | 2.48 | 29.7 | 18.06 | 60.88 |
| Amines & Plast. | 119.05 | 655.01 | 21.05 | 1.25 | 32.53 | 26.03 | 45.83 |
| Gufic BioScience | 186.95 | 1811.9 | 21.86 | 2.44 | 40.36 | 28.37 | 52.92 |
| Rajratan Global | 2165.85 | 2201.54 | 23.81 | 2.87 | 24.57 | 21.9 | 26.99 |
| Supreme Inds. | 2186.35 | 27780.84 | 23.92 | 3.86 | 20.3 | 26.37 | 2035.81 |
| NGL Fine Chem | 2687.35 | 1660.78 | 25.41 | 5.55 | 36.78 | 27.12 | 19.21 |
| Oriental Aromat. | 745.6 | 2503.23 | 26.91 | 2.87 | 29.69 | 16.13 | 130.7 |
| Stylam Industrie | 1068.2 | 1819.45 | 28.03 | 3.07 | 41.89 | 21.01 | 57.06 |
| Bharat Rasayan | 9987.15 | 4244.39 | 28.43 | 4.19 | 46.84 | 30.9 | 264.01 |
| Black Rose Indus | 211.1 | 1076.61 | 30.06 | 2.39 | 25.87 | 34.09 | 41.99 |
| Balkrishna Inds | 2241 | 43299.37 | 30.35 | 6.07 | 19.58 | 18.9 | 1896.51 |
| Vaibhav Global | 540.25 | 8830.82 | 30.52 | 3.26 | 20.31 | 25.43 | 714.66 |
| Balaji Amines | 3114.95 | 10109.41 | 30.67 | 5.67 | 24.48 | 24.65 | 65.01 |
| J K Cements | 3354.1 | 25828.15 | 33.17 | 3.41 | 27.34 | 16.06 | 2159.44 |
| Vidhi Specialty | 343.45 | 1719.12 | 34.13 | 4.21 | 25.87 | 27.05 | 70.11 |
| Best Agrolife | 1209.1 | 2854.63 | 36.25 | 3.06 | 127.47 | 11.11 | 24.92 |
| Lux Industries | 4220.7 | 12699.48 | 38.06 | 5.88 | 41.75 | 29.58 | 639.23 |
| Acrysil | 852.15 | 2273.6 | 40.4 | 5.61 | 22.5 | 14.88 | 13.75 |
| Amrutanjan Healt | 898.45 | 2625.93 | 41.6 | 6.86 | 19.07 | 21.08 | 145.39 |
| APL Apollo Tubes | 916.9 | 22938.37 | 43.29 | 2.12 | 23.62 | 21.14 | 1104.79 |
| Tanla Platforms | 1582.25 | 21500.15 | 49.23 | 7.76 | 17.91 | 7.67 | 700.13 |
| KMC Speciality | 63.25 | 1031.61 | 49.48 | 8.32 | 17.04 | 24.75 | 7.05 |
| Alkyl Amines | 3316.55 | 16952.19 | 54.73 | 11.72 | 39.77 | 35.27 | 359.41 |
| Abbott India | 19317.95 | 40924.36 | 57.02 | 8.84 | 27.46 | 25.55 | 2284.44 |
| Saregama India | 4493.1 | 8673.56 | 66.93 | 17.09 | 26.02 | 13.11 | 163.61 |
| Tata Elxsi | 5951.1 | 37094.03 | 80.8 | 17.26 | 27.68 | 31.65 | 1118.47 |
| Astral | 2198.55 | 44148.05 | 86.08 | 11.38 | 28.49 | 19.78 | 860 |
| HLE Glascoat | 6042.85 | 8258.51 | 133.01 | 17.79 | 34.79 | 34.54 | 57.78 |
List of smallcap multibagger stocks for 2022
In order to get get a list of smallcap multibagger stocks (potential), we filter the above list further by market capitalization, setting the maximum market cap at 8500 crores for smallcap stocks. We selectively present 3 stocks from the resulting list:
HLE Glasscoat Ltd
HLE Glascoat Ltd, formerly Swiss Glascoat Equipments Ltd, is engaged in designing and manufacturing of carbon steel glass lined equipment.
The Company’s products include AE & CE type reactors, rotary conical vacuum dryer (RCVD), agitated nutsche filter & drier (ANFD), heat exchanger/condenser, receivers/storage tanks, dryers, filters, columns and agitators. The Company offers accessories, such as valves, pipes and fittings.
The Company’s products cater to pharmaceutical/active pharmaceutical ingredient (API), specialty chemicals, dyes/colors, agro chemicals, food processing and allied industries.
The Company’s products include AE & CE type reactors, rotary conical vacuum dryer (RCVD), agitated nutsche filter & drier (ANFD), heat exchanger/condenser, receivers/storage tanks, dryers, filters, columns and agitators. The Company offers accessories, such as valves, pipes and fittings.
The Company’s products cater to pharmaceutical/active pharmaceutical ingredient (API), specialty chemicals, dyes/colors, agro chemicals, food processing and allied industries.
Oriental Aromatics Ltd
Oriental Aromatics is engaged in the Business of manufacturing Fine chemicals i.e. camphor, perfumery & specialty aroma chemicals, fragrances and flavours.
Company is one of only ten completely integrated flavour, fragrance and aroma chemical manufacturing companies in the world
Camphor and Allied Products Limited (CAPL), a listed subsidiary of the company was amalgamated with the company in January 2018. CAPL was the India’s largest manufacturer of terpene chemicals and other special chemicals. Post amalgamation the promoter holding increased from 57.66% to 74.17%
Company is one of only ten completely integrated flavour, fragrance and aroma chemical manufacturing companies in the world
Camphor and Allied Products Limited (CAPL), a listed subsidiary of the company was amalgamated with the company in January 2018. CAPL was the India’s largest manufacturer of terpene chemicals and other special chemicals. Post amalgamation the promoter holding increased from 57.66% to 74.17%
Associated Alcohols & Breweries Ltd
Associated Alcohols & Breweries Limited is a distillery company engaged in the manufacture of alcoholic liquor. It operates through Potable Alcohol segment. It is also engaged in the business of bottling vodka and Scotch whisky for international brands.
It has presence in all varieties of potable alcohols, country liquor (CL), rectified spirits (RS), extra neutral alcohol (ENA), distilled grain spirit, Indian made foreign liquor (IMFL) in the whisky, brandy, rum, gin and vodka categories, and bottling scotch whisky for other international brands.
It manufactures and markets in house brands, such as Red & White, James McGill, Bombay Special (in the whisky segment), London Bridge (in the gin segment) and Jamaican Magic in the rum category.
Its licensed brands include Smimoff Vodka, Captain Morgan rum, HAIG Scotch whisky, Masterstroke whisky, Glen Drummond single malt Scotch whisky and Royal Crown whisky. It has a production capacity of 42 million liters per annum.
It has presence in all varieties of potable alcohols, country liquor (CL), rectified spirits (RS), extra neutral alcohol (ENA), distilled grain spirit, Indian made foreign liquor (IMFL) in the whisky, brandy, rum, gin and vodka categories, and bottling scotch whisky for other international brands.
It manufactures and markets in house brands, such as Red & White, James McGill, Bombay Special (in the whisky segment), London Bridge (in the gin segment) and Jamaican Magic in the rum category.
Its licensed brands include Smimoff Vodka, Captain Morgan rum, HAIG Scotch whisky, Masterstroke whisky, Glen Drummond single malt Scotch whisky and Royal Crown whisky. It has a production capacity of 42 million liters per annum.
List of multibagger penny stocks for 2022
In US, stocks below one dollar (roughly 75 Indian rupees in todays date) are referred to as penny stocks. In the context of Indian markets, considering 100 rupees as the cut-off for penny stocks, the following stocks can be considered as potential multibagger penny stocks:
KMC Speciality Hospitals Ltd
KMC Speciality Hospitals (India) is a healthcare services and pharmacy company. It is a part of the KMC group of hospitals based at Tiruchirappalli.
The company is in the business of running a super specialty hospital having 175 beds with team of dedicated specialists and state-of-the-art equipment. They cater to key specialty areas such as Neurosurgery, Cardiovascular & thoracic surgery, Orthopedics, Plastic and Reconstructive Surgery, Gynecology, Neonatology and Nephrology (including renal transplants).
The company is in the business of running a super specialty hospital having 175 beds with team of dedicated specialists and state-of-the-art equipment. They cater to key specialty areas such as Neurosurgery, Cardiovascular & thoracic surgery, Orthopedics, Plastic and Reconstructive Surgery, Gynecology, Neonatology and Nephrology (including renal transplants).
Dolat Algotech Ltd.
Dolat Algotech Ltd, formerly Dolat Investments Ltd, is engaged in the trading of shares, securities and the commodities through various stock/commodities exchanges. The Company operates in three segments: shares and securities, commodities and others. The Company’s principal business includes other financial intermediation n.e.c.
Conclusion
If you had invested 1 lakh in Bajaj Finance in the 1995, you would probably be settled in the Caribbean today with a cool 1000 crore plus cash, sipping rum and enjoying retirement.
As Lynch says, you only need a few big winners !
As Lynch says, you only need a few big winners !
All you need for a lifetime of successful investing is a few big winners, and the pluses from those will overwhelm the minuses from the stocks that don’t work out.
Peter Lynch
Legendary American Investor and Fund Manager
But if you missed the previous one and don’t have the time to go hunting for the next big one, we are here to help.
Feel free to review our advisory offerings and select a plan that suits you.
Otherwise, just keep learning and happy hunting!
Feel free to review our advisory offerings and select a plan that suits you.
Otherwise, just keep learning and happy hunting!
Credits
Graphic credits – screener.in
Company overview credits – Reuters
The post Best Multibagger Stocks to Buy Now in India (2022) appeared first on ViniyogIndia.com.
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