Stocks that made investors crorepatis amid devastating Covid pandemic

NEW DELHI: Domestic stocks generated $1.68 trillion wealth during the months India wrestled a devastating Covid pandemic, which dragged India’s GDP down by 7.3 per cent in FY21.

That market rally, which some termed as ‘most painful of all times’ while others found totally disconnected with ground realty, also made many investors crorepatis at the fastest pace.

To get some perspective, the Rs 122.77 lakh crore wealth that equity investors have created from the lows of March 2020 equalled 91 per cent of India's GDP of Rs 135.13 lakh crore for FY21.

More than half of the actively-traded stocks on BSE – 1,474 out of 2,368 to be precise – delivered returns in excess of 100 per cent!

Even if one were to leave aside stocks with market-caps less than Rs 1,000 core, some 573 names swelled value by between two times and 21 times.

Data showed if an investor would have invested Rs 4.6 lakh in Tanla Platforms in March last year, she would be a crorepati at today’s price. The scrip has jumped almost 22 times, or 2,067 per cent, since March 23 last year.

In Subex, a Rs 5.2 lakh investment 14 months ago would have become Rs 1 crore today. In Adani Total Gas, a Rs 6.2 lakh investment would have made an investor crorepati in just over a year.

A Rs 6.5 lakh investment would have been sufficient to make you a crorepati in stocks like Intellect Design Arena and CG Power & Industrial Solutions.

At least eight other stocks with over Rs 1,000 crore in m-cap rallied 10 times or more during this period. That would mean a Rs 10 lakh investment just over a year ago in any of these stocks would have made you a crorepati today. Among these names were Balaji Amines, Adani Enterprises, Saregama, Mastek and Tips Industries, among others.

Stocks such as Godawari Power & Ispat, Adani Green Energy, OnMobile Global, Mukand, Karda Constructions, Butterfly Gandhimathi Appliances, HIL, and Laurus Labs were other stocks that rallied 8-10 times from their March lows.

The breakneck market rally swelled BSE’s total market capitalisation from Rs 101 lakh crore in March 2020 to roughly Rs 232 lakh crore today. This even made RBI take note and smell a likely bubble in the market.

India was not an exception to this trend. Asset prices have surged across the globe on stimulus from central banks and governments globally. In its annual report, RBI said this equity rally is being driven by strong FPI flow fuelled by easy liquidity.

“Global market capitalisation has increased 31 per cent, while bond values have risen on a modest drop in yields. House prices have gone up since February 2020, broadly the start of the Covid-19 pandemic. This is great news for households, who own assets,” said Kotak Institutional Equities in a strategy note.