Profits of 13 companies more than doubled in Q2! Take a look

With the September quarter earnings season turning out to be better than Dalal Street's expectations, there were at least 13 BSE500 companies whose profits more than doubled and sales grew at least 50% on a year-on-year (YoY) basis

Topping the list is specialty chemicals company Fine Organic Industries whose profit grew four times to Rs 202.73 crore in Q2 while its sales jumped 110% on a YoY basis. The company is the largest player in the oleochemical industry in India and among the top six globally.

The stock, which has rallied over 70% in the last one year period, is held by Saurabh Mukherjea in his Little Champs portfolio.

Adani Enterprises, which is the flagship entity of billionaire Gautam Adani-led conglomerate, reported a 261% jump in quarterly profit and 189% jump in sales. The stock, which is up 136% in the last one year, hardly has any analyst coverage.



The Phoenix Mills, The Great Eastern Shipping Company and GHCL reported over 200% jump in the quarterly bottomline, shows data from ACE Equity.

Shares of Deepak Fertilisers, which reported 195% jump in profit growth, have more than doubled in the last one year. On the other hand, despite 185% rise in Q2 profit, shares of IT company Infibeam Avenues have lost about 26% of its value in the last 12 months.

What should investors do?

With Sensex and Nifty hovering near all-time record high levels, stocks with strong earnings are more likely to outperform.

Domestic brokerage firm Motilal Oswal has maintained an overweight stance on BFSI, auto, consumer & IT stocks and underweight on energy, pharma and utilities. Its top picks within the largecap basket includes RIL, Infosys, ICICI Bank, Bharti Airtel, Maruti Suzuki, Titan, UltraTech Cement, Coal India, IndusInd Bank, Apollo Hospitals and Macrotech Developers.

Kotak Institutional Equities said Axis Bank, Bajaj Auto, Britannia, L&T, ONGC, Sun Pharma and Tata Motors significantly outperformed its estimates within the Nifty50 pack.

Valuations, however, remain a concern. Headline indices are now about 10% premium to their long-term average and slightly lower than one standard deviation.

"Valuations of the Indian market are quite rich. We find little value across sectors. Valuations of non-financial ‘growth’ stocks, whether large-cap or mid-cap, are extremely rich and many are trading at higher than March 2019 levels when bond yields were at a similar level. India’s macroeconomic position has weakened considerably since then," said Sanjeev Prasad of Kotak.

(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)