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Friday, November 2, 2012

9 Hidden Gems which Doubled Investment in 10-15 Months

Dear Reader,

Do you know that if you had invested Rs 1 lakh in Crompton Greaves on 1 January 2002, your money would have grown to Rs 70 lakh by now. Back then, Crompton Greaves was a small capital goods company with a market capitalisation, or market cap, of Rs 115 crore and a stock price of Rs 1.80.

It has been one of the biggest wealth creators in the Indian stock market and given almost 50 per cent annualised return over the last 11 years. The company had a market cap of Rs 7,950 crore on 1st Nov 2012 while its stock is trading at Rs 124.

On 2 January 2002, Sesa Goa had a market cap of Rs 99 crore and its stock was at Rs 1.28. On 1st Nov'12, the stock price closed at Rs 172 and the company's market cap is Rs 14,880 crore.

Do you own such stocks which can give you similar returns in future?

The number of small-cap stocks is large and finding a quality stock that can give high returns over a long period is tough even for equity analysts. One reason is that such stocks usually have a short history and are not tracked by many analysts and brokerage houses. Then there are risks such as low liquidity, governance concerns and competition from larger players.

Scores of once small companies have over the years grown big, giving investors a 30-50 per cent annual return over 10-15 years and creating fortunes for investors. However, more often than not, we find ourselves at the wrong side of the fence and regret our inability to spot such stocks on time.

If these factors scare you but you still want to gain from the upside potential of such stocks, Saral Gyan Hidden Gems is an ideal choice for you.

It’s a fact that now 9 Hidden Gems out of 21 released by our equity analysts in last 2 years have given more than 100% returns. Stellar performance during tough time of stock markets (all major indices have given negative returns since last 2 years), imagine how these companies will flourish during good times.

We are delighted to share the 9 Hidden Gems recommended by our equity analysts during last 2 years which gave more than 100% returns.


Earlier it was 8 stocks, Mayur Uniquoter is the 9th one which has doubled the investments of our members in short span of 7 months. We have suggested partial profit booking with above 100% returns in many of these stocks. Hence, our members hold remaining 50% quantity of these stocks for free in their portfolio.

Buying Strategy for Small Caps

1. Go for companies with low debt ratio (preferably less than one)

2. A high interest coverage ratio (above 3x) and a high return on equity are big advantages

3. Avoid companies with huge liabilities in the form of foreign currency convertible bonds / external commercial borrowings

4. Look at the quality of the management, its governance standards and how investor-friendly the company is.

5. Mid-cap and small-cap companies can be future market leaders, so be patient with your investments

Saral Gyan equity analysts have identified 3 Multibagger small cap stocks with promising future in terms of earnings and growth, these 3 small caps have the potential to multiply your investments by 3-5 times in next 3 years.

What else we need? Simply invest in these stocks and hold them tightly for next 3 years to create wealth. We are going to accumulate these 3 small caps in our portfolio and hold them for atleast 3 years to get rewarded in big way. What about you?

Those who wish to invest in small-cap stocks should do so only if they have a long investment horizon and tolerance for volatility. Small-cap stocks suffer the steepest falls in a bear market and rise the most in a bull market. An investor should stay invested for at least three-five years to allow their portfolio to gain from at least one bull run.

Saral Gyan team do take care of associated risks of investing in equities by doing indepth research and analysis of small cap companies before releasing Hidden Gems research reports with buy recommendation. Its sincere efforts, dedication and passion of our equity analysts that 5 out 12 Hidden Gems of 2011 and 2 out of 9 Hidden Gems of 2012 have given more than 100% returns to our members.  If you have patience and want to add extra power in your portfolio, start investing some portion of your savings in fundamentally strong small companies - Hidden Gems

In case of any queries, do contact us.

Regards,

Team – Saral Gyan,
Saral Gyan Capital Services.