Stocks that defied DeMon

Stocks that defied DeMon
Stocks that defied DeMon

As the political slugfest over the shock announcement of demonestisation two years ago rages on, not many stock investors are ruing their decision to keep the faith in equities even though the bolt from the blue event had shaken India Inc in many ways.

An analysis shows over 40 stocks have given more than 100 per cent return to stock investors since the November 8, 2016 event. Some of these stocks are considered direct beneficiaries of demonetisation, though most are not.

Surprisingly, industrial manufacturing companies have won hands down in rewarding stock investors, though the economy was up against macro challenges during the last two years.

Three stocks, namely HEG, Indiabulls Ventures and Graphite India rallied more than 1,000 per cent during the two years, though their gravity-defying jive had not much to do with demonetisation. HEG and Graphite India have been riding a global shortage in graphite electrodes while Indiabulls Ventures has started moving up after it entered consumer lending.

Such outperformance from a select set of stocks come in the backdrop of a 27 per cent rise in the Sensex during the two years. As a result, the market capitalisation of BSE-listed stocks jumped by more than Rs 30 lakh crore to Rs 141.67 lakh crore from Rs 109.6 lakh crore.

According to Lucknow-based brokerage Ace Equity, some 44 stocks have more than doubled investors wealth during the last two years.

Apart from the three mentioned above, the stocks in the BSE 500 Index that have more than doubled investor wealth V-Mart Retail, Venky’s India, Phillips Carbonblack. Rain Industries, Adani Transmission, Sterlite Technologies, Future Retail, VIP Industries, Himadri Specialty Chemicals, among others.

In the BSE Small-cap Index as many as 60 stocks have more than doubled investors’ wealth, including Balkrishna Industries, Bajaj Electricals, Jubilant FoodWorks, Bata India, Vaibhav Global, Shakti Pumps, NIIT Technologies, Radico Khaitan and Usha Martin.

In the BSE Mid-cap Index, four stocks--Biocon, JSW Steel, Jindal Steel & Power and Adani Enterprises--have more than doubled investors wealth.

Surprisingly, out of the 44 companies that have rewarded investors handsomely in the last two years, nearly half are hard-core manufacturing companies and eight six are technology companies. Eight in the list are consumer retail companies, including consumer goods manufactures. The list has only two financial services companies.