These nine companies rally up to 100% in November

Domestic equity indices scaled new highs as the second last month of 2022 (calendar year) drew to a close. November was the month when a number of stocks rewarded investors handsomely.

Public sector companies hogged the limelight during the month, particularly the railway companies and state-run lenders. Other gainers majorly belonged to infrastructure and related sectors.

According to the Ace Equity data, more than 730 stocks with a market cap of over Rs 500 crore delivered positive returns to investors till November 28.

Of them, nine counters have zoomed between 50 and 100%, with two stocks turning multibaggers. Additionally, 30 other stocks gained over 30% during the period.

Rail Vikas Nigam and Davangere Sugar Company have topped the list, rallying 100% during the month, followed by Kamdhenu and Refex Industries, which jumped 85% and 80%, respectively.

Sat Industries (79% up), UCO Bank (57% up), Foods & Inns (55% up), Honda India Power Products (53% up) and The Karnataka Bank (50% up) have rallied strongly to reward investors.

Other railways and defence stocks, including Indian Railway Finance Corporation, Ircon International, Mazagon Dock Shipbuilders, and Dredging Corporation of India also gained 30-50% during the month.

“Investors are now beginning to realise the implications of the government's massive capex spending of which the railways is the biggest beneficiary,” said small case manager Abhishek Basumallick of Intelsense Capital.

“The government is increasing its capex and at 19%, the railways have the highest share of spending,” he added. “Stocks in India go up for two reasons – growth or the expectation of growth. Here it is because of the second factor.”

Among state-run lenders and financial services providers Union Bank of India, IFCI Housing & Urban Development Corporation, Bank of India, Bank of Maharashtra and Punjab & Sind Bank also made to the list.

“PSUs have underperformed for 15-20 years or so and a lot of interest has come back into them as these are stable economic times, we are in a cyclical upswing and businesses have good visibility as far as earnings are concerned,” said Dipan Mehta, Director, Elixir Equities, in an interaction with ET NOW.

“Overall, apart from oil companies, we have not seen much interference coming through by the government in the way the PSU companies are being run,” he added.

Stocks like Easy Trip Planners, JTEKT India, Ajmera Realty & Infra India, Redington, Skipper, TVS Srichakra, Sanghvi Movers and Ion Exchange (India) also gained more than 30% during the month.

Market participants remain positive on the Indian equity space for the coming years and suggested investors accumulate quality names at every correction.

“Buy every dip from here on for the next several years in India and that is the easiest way to understand this. Do not micro manage these relationships; make this into a longer term relationship,” said market veteran Shankar Sharma.

On the contrary, a few experts have a contrarian view on Indian markets, following this sharp run, and consider Dalal Street to be an expensive place to be in.

“We are in an expensive spot. I do not think now is the time to recommend and cajole people to buy more equity. Maybe the time is right to diversify on a relative basis," said Nikhil Kamath, Co-Founder, Zerodha & True Beacon.

(With data inputs from Ritesh Presswala)
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)