These 4 multibaggers of 2021 turned investors poorer in 2022

Notwithstanding the volatility in domestic equities this year, several stocks turned multibaggers. But the stocks that multiplied wealth of investors in 2021 failed to sustain the show in 2022.

An analysis of the performance of the stocks that are part of the BSE 500 index showed that the value of 4 among them more than halved this year, after they gave manifold returns to investors in 2021.

Interestingly, the four stocks belong to the communications and digital services sectors, which bore the brunt of selling this year.

Shares of Brightcom Group, Tanla Platforms, Tata Teleservices (Maharashtra) or TTML, and Zensar Technologies have fallen by a sharp 58-73% in 2022.


A major sell-off in technology stocks worldwide amid the spike in bond yields turned investors away from this sector in the initial part of the year. Further, the rising inflation and slowdown in growth in developed economies of the US and Europe added fuel to this sell-off.

The US makes for more than a third of the revenue of the software industry and the growth slowdown led to concerns of a fall in demand for digital services.

2021 RECAP
Brightcom Group, a digital marketing services company gave multifold returns to investors in 2021, as the stock rose by a staggering 2,518%. Last year, e-commerce and digital services providers’ business was booming due to the pandemic-induced restrictions on mobility. The company reported 89% profit growth on a 78% sales growth in FY22.

Similar to Brightcom Group, TTML had a never-seen-before bull run in the last year. The stock turned the rags to riches as its value zoomed 2,500% in 2021 after rising over threefold in 2020.

It was the best performed stock within the Tata Group pack. However, after two years of a strong show, the stock lost momentum in 2022.

Tanla Platforms, a stock unspoken off much among the analyst community, became the darling of Dalal Street in 2021 as its value more than doubled. The cloud communications services provider has over the last few years reported higher-than-industry earnings growth.

Similarly, Zensar Technologies attracted investor frenzy in 2021 as the pandemic led to the need for digital transformation across industries and saw the order book of technology companies across the board hitting record highs.

What next?
After the sharp corrections that stocks have seen this year and the prevailing bleak outlook for growth for the technology sector, the view on stocks is mixed.

“Apart from Zensar Technologies, all the other stocks look vulnerable at this point in time,” said Mehul Kothari, assistant vice president - technical research at Anand Rathi Investment Services. “The trend is down with a steep fall, and the supports are still far away.”

For Zensar Technologies, Kothari expects Rs 170-200 to act as a strong base in the medium term.

Kothari believes positional traders can look at accumulating the stock if short-term trend offers a buy signal. In that case, the stock can rally towards Rs 275-300, he said.

Meanwhile, Geojit Financial is positive on Tanla Platforms and recommends buying the stock for a 12-month target of Rs 920. This implies an upside potential of 30% from the current levels.

The stock appears reasonable to the brokerage and currently trades at a price-to-earnings multiple of 17 times on a FY25 earnings basis, which is less than the 5-year average.

“We expect earnings to grow at a 21% CAGR during FY23-25E. Hence, we value Tanla at 19x FY25E with a target price of Rs 920 per share and recommend a buy rating,” the brokerage said.

(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)