When you kept doubting the stocks rally, 32 BSE500 stocks doubled wealth in 3 months

You may have all kinds of doubts over the ongoing stocks rally in India and elsewhere, yet the fact is this market is creating wealth!

The rapid rise in domestic equities from their March lows has not only helped investors recover much of their losses, but also created big wealth for some, with several stocks doubling prices in just three months.

Data showed 95 per cent of BSE500 stocks from across sectors have delivered a positive returns since March 24, when the benchmark BSE Sensex had hit its 52-week low.

With a 202 per cent rally, TV18 Broadcast emerged chart topper among the 32 BSE500 stocks that doubled money from their March lows. The stock rose to Rs 37.50 on June 19 from Rs 12.40 on March 24.

Others on the list included Hathway Cable & Datacom (up 200 per cent), Reliance Power (up 199 per cent) and Adani Green Energy (up 198 per cent).

Better-than-expected financial results, company-specific reasons and robust liquidity in the market lifted these stocks. Media firm TV18 Broadcast reported a five-fold rise in consolidated net profit for March quarter at Rs 141.83 crore. Adani Green Energy posted a consolidated net profit of Rs 55.64 crore for Q4FY20, helped by lower expenses, against a consolidated net loss of Rs 94.08 crore reported for the corresponding quarter a year ago.

Ajit Mishra of Religare Broking said Adani Green Energy has seen a smart runup in recent days after the company denied any material impact from Covid-19 on its profitability.

The BSE Sensex is up 36 per cent at 34,909 during this period, while the BSE500 index has gained 37 per cent. Their Wall Street peers Dow Jones Industrial Average, S&P500 and Nasdaq have advanced up to 50 per cent from their March lows.

Among other big gainers, Reliance Infrastructure, Network18 Media, Vodafone Idea, Jain Irrigation, Jubilant Life Sciences, Intellect Design Arena, EID Parry, Dhanuka Agritech and Aurobindo Pharma have gained anywhere between 140 per cent and 180 per cent.

Brokerage Emkay Global Financial Services is positive on Aurobindo Pharma with a price target of Rs 835. “March quarter was solid for the company on strong execution across markets, sharp gross margin expansion and debt reduction. Ebitda was 12 per cent higher, while margins were 130 basis points above estimate at 21.4 per cent.”

Jubilant Life Sciences also turned around in March quarter, reporting a consolidated net profit of Rs 260.49 crore on robust sales in the pharmaceuticals segment. It had posted a net loss of Rs 100.65 crore for the year-ago period.

Anand Rathi Shares and Stock Brokers is positive on Jubilant Life with a price target of Rs 867.

“Jubilant Life Sciences’ business is positioned well in the current environment, which bodes well for companies having manufacturing footprint in both the US and India. Moreover, the demerger of LSI (Life Science Ingredients) business will allow value unlocking for the pharma business. We continue to remain positive on the company from a medium- to long-term perspective,” the brokerage said.

Suzlon Energy, in which individual investors including HNIs hold 49.87 per cent stake, gained 137 per cent to Rs 4.29 from Rs 1.81 on March 24.

Reliance Capital, Muthoot Finance, Indiabulls Housing Finance, Dishman Carbogen Amcis, Inox Wind, KRBL, Infibeam Avenues, Glenmark Pharmaceutical, ITI and HEG were the other players that more than doubled investors’ money in three months.

Antique Stock Broking said Muthoot Finance’ growth is going strong, growing 4 per cent YoY in terms of tonnage and 21 per cent in terms of value. Despite the ongoing pandemic situation, this indicates strong pan-India level demand. “Operating leverage was clearly visible with a sharp improvement in profitability,” the brokerage said.

Glenmark hogged the limelight after it launched antiviral drug Favipiravir, under the brand name FabiFlu, on June 21for treatment of patients with mild to moderate Covid-19 infection at a price of Rs 103 per tablet.

If the drug proves to be efficacious over the next few months, the company will enjoy first-mover advantage.

Trident, Jindal Stainless (Hisar), PC Jeweller, Rashtriya Chemicals, Jai Corp, ICICI Securities and GMM Pfaudler and Reliance Industries have also jumped over 100 per cent from March lows.