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Monday, July 17, 2017

5 Stocks: Potential 5-Baggers in 5 Years Report Update

Dear Reader,

We are pleased to inform you that we will release 4th Issue of our Special Report Update 5 Stocks - Potential 5-Baggers in 5 Years in August 2017 and share with our Hidden Gems, Value Picks and Wealth-Builder members. Our 4th Issue of Special report will include performance update of 5 companies which were recommended in our 3rd Issue of this report published last year on 05 June 2016. We will evaluate results of last financial year of these companies and suggest necessary action with hold / sell / buy update. This Report will cover company's background, recent updates and developments, investment rationale along with our views and recommendations. Importantly, report will also includes update on any exclusion of existing stocks or inclusion of new stocks to ensure that these stocks can deliver 5 times returns over a 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 any other asset classes like Fixed Deposits, Real Estate, Precious Metals – Gold / Silver or even major indices - Sensex and Nifty.

However, our team is confident enough to achieve 5 times returns in period of 5 years by monitoring performance of these companies every year 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 
  • Manageable 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 1% in last 5 years
  • Increasing EPS, low PE ratio with ROE and ROCE above 20% in last 5 years.
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. Stocks selection in our special report 5 Stocks - Potential 5 Baggers in 5 Years is done on the basis of fundamental analysis considering above mentioned parameters.

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.

Since beginning of this year, we have witnessed strong rally on positive global as well as local cues. Factors like BJP victory in UP with the biggest margins in 37 years followed by stability in commodity prices, implementation of GST, change in Fed views regarding US rate hike and above average  monsoon so far in major part of the country helped major indices, Sensex and Nifty to rise by more than 20% since beginning of 2017. With hefty gains in major indices over last 6 months, possibility of correction in near future cannot be ruled out. However, if you are a long term investor, you must avoid timing the market and invest systematically. Any severe downfall in market must be considered to accumulate high quality companies with strong fundamentals to get rewarded in long term.

The BJP landslide victory with clean sweep in UP and Uttarkhand gives further comfort for 2019’s Lok Sabha elections with high expectation of stable government for next seven years. Political stability is one of the most important factor for economic growth and development of any country, it not only give confidence to Investors but also allows government to implement various policies and reforms smoothly.

Now, let us review the performance of our 5 stocks over last 2 years against major indices Sensex and Nifty. Below table indicates the performance of our Potential 5-Bagger stocks during 1st year. We reviewed these stocks in 3rd issue of our Special Report released last year on 05 Jun'16 and below is the performance update as on 5th Jun'16 along with suggested action.

In our 3rd issue of Special Report released on 05 June 2016, we informed our members what strategy needs to be followed going forward with these 5 stocks in terms hold / exit or add on dips update. As indicated in the table above, we suggested to hold 4 out of 5 stocks with buy / buy on dip approach to new members who were not holding these companies. Moreover, we suggested to switch from one of the existing stock to a new stock taking a fresh entry into it. We are glad to share that the stock which we included last year as one of the Potential 5-Bagger stock with buy recommendation has given whopping returns of 243% in period of 13 month.

Below is the as on date performance of our Potential 5-Bagger stocks since release of our 3rd issue on 05 Jun'16 and since release of 2nd issue on 03 May'15.

We are glad to inform our readers that our carefully picked 5-Bagger Stocks have delivered returns of 78.7% against Sensex returns of 18.5% since release of our 3rd issue of special report on 3rd Jun'16.

Moreover, our potential 5-Bagger stock picks have given average returns of 109.8% as on date against Sensex returns of 18.7% (27011 - 32075) and Nifty returns of 21.2% (8181 - 9916) during last 26 months i.e. since 3rd May 2015, hence outperformed Sensex and Nifty by 91.1% and 88.6% respectively.

In continuation of our effort to ensure that our members get rewarded getting better returns on their investments in medium to long term by investing in good quality small and mid cap companies, we will publish our 4th Issue of Special Report - Potential 5 Baggers in 5 Years during next month. After reviewing these 5 companies based on their performances in last financial year and to take corrective action, we will release 4th Issue of Special Report 5 Stocks: Potential 5-Baggers in 5 Years Update in August 2017.

If you wish to receive 4th issue of our Special Report 5 Stocks : Potential 5-Baggers in 5 Years Update (to be released in Aug'17), simply subscribe to Hidden GemsWealth-BuilderValue Picks or any of our combo packs and we will send you the report without any extra charges under ongoing 7th Anniversary offer.

Discounts & valuable freebies which make our 7th Anniversary special for all our readers are as under:

1. Maximum discount up to 30% on combo pack subscriptions
2. Hidden Gems Flash Back Report - Released in April'17
3. Value Picks Flash Back Report - Released in July'17
4. 5 Stocks - Potential 5-Baggers in 5 Years Report Update - To be released in Aug'17
5. Existing Portfolio Health Check Up under Wealth-Builder subscription 
6. Saral Gyan eBook - "How to Grow your Savings?" worth Rs. 599 for Free.

Below table indicates subscription services and discounted prices valid up to 31st July'17.
Saral Gyan 7th Anniversary Offer 
Hidden GemsRs. 10,000 9,000
Value PicksRs. 6,000 5,400
Wealth-BuilderRs. 20,000 18,000
Combo 1: HG + VP + WB + 15%Rs. 40,000 28,000
Combo 2: HG + VP + 15%Rs. 20,000 15,000
Combo 3: HG + VPRs. 16,000 13,000
Combo 4: HG + 15%Rs. 14,000 11,500
Combo 5: VP + 15%Rs. 10,000 8,500

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Wish you happy & Safe Investing!

Team – Saral Gyan