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Wednesday, October 8, 2014

5 Hidden Gems: Potential 5-Bagger within 5 Years Report

Dear Member,

We released our 5 Hidden Gems stocks - Potential 5-Baggers within 5 Years on 26th July’13 last year, it was the time when there was lot of pessimism around the market and we find it as one of the best time to invest in some of the fundamentally strong small cap companies. Later in April this year, we released update on our 5 Hidden Gems - Potential 5-Baggers within 5 Years report in which we included company’s performance, updates and development in these companies along  with our views and recommendation with buy / sell / hold decisions and also the fair price range to accumulate these stocks.

Update on this report was published in April'14 which we shared with all our Hidden Gems and Wealth-Builder members, We would like to inform our readers that there is no change in our views and we suggest our members to continue holding these companies with a long term perspective. Moreover, one of the Hidden Gem stock of last year was replaced by another stock in April update which has proved to be a good decision.. 

Our team published special report 5 Hidden Gems - Potential 5 Baggers within 5 Years with an objective to achieve average annualized returns of 38% each year to achieve 5-Bagger returns in period of 5 years. As illustrated in table below, if these 5 companies generate returns on your investment @ 38% annually, your investment will be 5 fold in period of 5 years. Even if we take conservative scenario considering that only one out of five achieve CAGR of 38% and remaining four delivers CAGR of 20%, your investment will be trebled (3 times) in period of 5 years which is also good compared to returns from other asset classes or major indices - Sensex and Nifty.

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However, our team while selecting these stocks was confident enough to achieve 5 times returns in period of 5 years by monitoring performance of these companies and taking corrective measures in case any of them does not perform up to our expectations.

Few important parameters which have been looked by our equity analysts while finalizing the stock selection are as under: 
  • Market leader in the business / any one segment in which the company is operating in.
  • Scalable business with significant moat (sustainable competitive advantage)
  • Prudent Management with promoters increasing their shares holding in the company 
  • Zero or negligible debt on books with healthy cash flows.
  • CAGR of above 15% with increase in operating and net profit margins in last 5 years.
  • Consistent dividend payment with dividend yield above 2% in last 5 years
  • Increasing EPS, single digit PE ratio with ROE and ROCE above 20% in last 5 years.
  • Zero or negligible share holdings of Institutions (FIIs & DIIs) to get first mover advantage.
Each parameter is equally important and plays a vital role to ensure that you get healthy returns on your investment with limited downside risk in long term. One of the important key to successful investing is to pick the right business at decent valuations. Once you buy shares, you own a part of company’s business.

We at Saral Gyan recommend good businesses to buy with long term view and any change in our stock views will be based on strong structural trend and not on any short term movement.

We are glad to share that 4 out of 5 Hidden Gems have given astonishing returns in the range of 250% to 500% within first 15 months and investment made by our members in these stocks have already multiplied by 4 times, we have still 45 months left to get our investment multiplied by 5 times which we are sure will be achieved much sooner than later. Moreover, we are positive to see these stocks turning 10-Bagger for our members.

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Average returns of our 5 Hidden Gems as on date is 299% compared to Sensex returns of 33% (19748 to 26247) and Small Cap index returns of 92% (5516 to 10564) since 26th July’13. Our 5 Hidden Gems stocks have outperformed small cap index by 207% and Sensex by whopping 266% during first 15 months.

As Sensex and Nifty are at all time high, we have not suggested aggressive buying in these companies at current levels. But to ensure that we do not miss good investment opportunities, we have suggested initial allocation of 2-3% which can be increased further in case of correction in stock prices.

Note: If you wish to receive our Special Report 5 Hidden Gems : Potential 5-Baggers in 5 Years – Apr’14 update, simply subscribe to Hidden Gems or any of our Hidden Gem combo pack and we will send you the report without any extra charges! 

You can avail attractive discounts and freebies during this festive season with our ongoing Dussehra - Diwali Offer of the Year. So what are you waiting for? Simply subscribe to our services at discounted price and grab our Special Report for Free! Check out other benefits you will get on our Dussehra Diwali Offer of the Year - Click here for details.

You can subscribe online to our services by simply click on SUBSCRIBE! link, To know about other payment options and bank detailsclick here

Note: Subscription cycle of the members joining under our ongoing offer will be Oct'14 to Sep'15.

In case of any queries, simply write to us. We will be delighted to assist you!

Wish you happy & Safe Investing!

Team – Saral Gyan

Saral Gyan Capital Services.