IREDA, RVNL among 12 midcap multibaggers since last Diwali. 10 gems for next Samvat

BSE Midcap index has produced 12 gems since last Diwali, each delivering multibagger returns with 26 others yielding double-digit returns of 50% or more. There are 19 duds as well in the pack of 192 stocks which have fallen by up to 50% during this period.

The 12 multibaggers are Indian Renewable Energy Development Agency (IREDA), Dixon Technologies (India), Rail Vikas Nigam (RVNL), Oracle Financial Services Software (OFSS), Oil India, Torrent Power, Glenmark Pharmaceuticals, Voltas, PB Fintech (Policybazaar), Hindustan Petroleum Corporation (HPCL) and Kalyan Jewellers India which have given returns between 182% and 100%.

Many other stocks would have been multibaggers, had it not been the profit booking over the last one month following a strong rally in them. Stocks like Cummins India, Prestige Estates Projects, CG Power and Industrial Solutions, Lupin, Bharat Heavy Electricals (BHEL) and Suzlon Energy which have gained between 99% and 78% since November 12, 2023 (Diwali). These stocks have fallen by up to 17% in the last one month.

There are four stocks which were listed post 2023 Diwali viz. Go Digit General Insurance, Tata Technologies, IREDA and Bharti Hexacom and in this, state-run IREDA stands tall among the 192 stocks in the BSE Midcap index with a whopping 223% returns.

BSE Midcap index’s returns since the last Diwali is around 40%. It has fallen by nearly 7% or 3,400 points from its September peak of 49,621.69.

Out of the 19 counters that have slipped into the red, Zee Entertainment Enterprises (ZEEL), One 97 Communications (Paytm), IDFC First Bank, Bandhan Bank, The Ramco Cements, Relaxo Footwears, Dalmia Bharat, Tata Elxsi, Kansai Nerolac Paints and Procter & Gamble Hygiene and Health Care are stocks whose prices have fallen in double-digits.

Star Health and Allied Insurance Company, Bank Of India, Vedant Fashions, UPL, Astral, Aarti Industries, Delhivery, APL Apollo Tubes and AU Small Finance Bank have fallen in single digit between 4% and 9%.

Commenting on the current trends in the midcap space, Jathin Kaithavalappil, AVP Institutional Research at Choice Broking said that midcap space is facing temporary headwinds, but certain stocks can still remain good bets till the next Samvat. "One of the key reasons behind this bull run in Indian stocks has been the continuous domestic investments, which have balanced the outflows due to foreign institutional investors selling. Although these flows will keep supporting the markets for some time, the room for further upside may be restricted due to high valuations," Kaithavalappil said.

Most importantly, the narrative of India’s growth story is in a good shape and so staying invested is advised, this analyst said, adding that certain segments will offer the possibility of expansion.

Kranthi Bathini, Director-Equity Strategy at WealthMills Securities does not see a broad based runaway rally going ahead and till the next Diwali, though he expects midcaps to still do well. Considering the current uncertainties, his advice to investors is to focus on capital protection and index beating returns instead of looking for potential multibaggers.

Bathini remains positive about BFSI and defence as themes for Samvat 2081.

Samvat 2081 outlook

Choice Broking's Executive Director Sumeet Bagadia sees market stablising after a 7% correction in Nifty from its peak. "This pullback offers a strategic buying opportunity as the market sets up for a potential recovery. The current chart structure indicates the market is stabilising, and the correction could be reaching its final phase, providing a favorable environment for long-term investors," he said, placing Nifty's target at 26,500-28,000 by Diwali 2025.

Midcap stocks to buy:

Choice Broking:

Buy: Oberoi Realty at 1,957 | Target Price: 2,200-2,400 | Stop Loss: Rs 1,800

Buy: Bharat Dynamics | Target: Rs 1,501

Buy: Granules India | Target Price: 723

Buy: Global Health | Target Price: Rs 1,246

JM Financial

Buy: NALCO | Target Price: Rs 264

Angel One

Buy: Nippon Life India | Target Price: Rs 820

Buy: Persistent Systems | Target Price: 7,040

Buy: Torrent Power | Target Price: 2,300

Anand Rathi

Buy: IRB Infra at Rs 60-55 | Target: Rs 70-86

Buy: Tata Technologies at Rs 1080-1040 | Target: Rs 1360-1450

(Data inputs: Ritesh Presswala)

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)