Every individual starts his/her investing journey with a sole motive of being profitable. There is a fact that the majority of newbie investors view the financial markets as a “rich-quick scheme.” Due to which they end up incurring heavy losses as their portfolio is largely based on greed rather than on quality research. Now, the question arises how one can know for sure which stock is profitable?
To transform the greed based portfolio into a research based portfolio, one has to collect data , including technical aspects of a company’s product or services, quarterly reports, and so on. This analysis will help us find the latest growth stocks in the market.
Let us now have a look at the top 7 research based stocks. Which are expected to achieve the fastest growth rate in 2023.
The first spot in our list is occupied by GAIL INDIA. It is one of the most undervalued stocks in the industrial sector. GAIL holds expertise in gas and fuel production. As the government launched an initiative to improve energy transition fuel, GAIL INDIA is expected to yield higher profits in the coming years.
Market Cap.(cr)
61,016.92
Dividend yield(%)
7.19
ROE(%)
19.11
EPS(Rs)
23.34
2. Deepak Nitrite
Deepak Nitrite is a well known chemical manufacturer in India. The company manufactures Basic Chemicals, Fine & Specialty Chemicals, Performance Products, and Phenolics. The company has a huge customer base as it supplies its product across a diverse range of industries and big names such as Reliance industries, Bayer, BASF and Hindustan Petroleum etc.
Market Cap.(cr)
24,878
Dividend yield(%)
0.38
ROE(%)
31.95
EPS(Rs)
78.20
3. Reliance Industries
Reliance Industries owns the world’s largest oil refining hub, generating high revenue from oil and gas sectors. It has its own chain of businesses such as telecommunications, mass media petrochemicals, and energy etc. It is a multi-bagger stock generating high and consistent returns throughout the financial years.
Market Cap.(cr)
15,75,727
Dividend yield(%)
0.34
ROE(%)
7.78
EPS(Rs)
94.01
4. Adani Green
It is owned by the Adani group. Backed by an Indian Conglomerate, Adani green produces sources of renewable energy. As India is moving towards energy transition, the stocks which are mainly focused on renewable energy production will be in the limelight for the coming years.
Market Cap.(cr)
148,249
Dividend yield(%)
–
ROE(%)
41.09
EPS(Rs)
3.36
5. KEI Industries
KEI Industries Limited is among India’s top three wire and cable manufacturers, with a comprehensive product portfolio ranging from housing wires to Extra High Voltage (EHV) cables. As the government is providing a huge push in the form of financial assistance to infrastructure development, the growth of C & W (cable and wire) industries is inevitable.
Market Cap.(cr)
15,133
Dividend yield(%)
0.15
ROE(%)
17
EPS(Rs)
50.47
6. Zen Technologies
ZEN technologies is considered as one of the top manufacturers of drones in India. Their product portfolio includes grenade simulator, small arm training simulators, aptitude testing systems, and other military weapons. Recently, the company got financial assistance of Rs120 crores from the Indian government as the programme of “self-reliant India” is at its peak. The company still has a lower share price despite the profitable performance. Therefore, it could be one of the best undervalued picks.
Market Cap.(cr)
1,583
Dividend yield(%)
0.05
ROE(%)
0.95
EPS(Rs)
3.25
7. Britannia Industries
Britannia is one of the largest FMCG companies in India, with a portfolio across multiple products such as Biscuit, Bread, Cake, Rusk, Dairy and Adjacencies. The FMCG sector is one the fastest growing segments in India. As the need for processed food thrives in the Indian subcontinent. The sale of biscuits constitutes 75% of its total revenues. It acquires a deep penetration level as it reaches almost 90% of households living in the country.
Market Cap.(cr)
1,11,494
Dividend yield(%)
1.22
ROE(%)
59.60
EPS(Rs)
88.97
Determinants to Identify the Fastest Growth Stocks
An investor needs to evaluate various factors before investing in a profitable stock:
Sectoral analysis: The first thing an investor should look upon is to access the fastest growing sector. The sector with high growth potential would offer higher returns to the investor.The investor should also assess the number of participants in the sector and the intensity of competition to determine the growth opportunities for the company.
Management Analysis: The quality of management determines a company’s potential in protecting itself from multiple economic shocks. It also ensures the company’s survival at the time of recession or other global economic disturbances. The quality and well qualified managers will always add value to the company. The efficient managers would provide efficient techniques to achieve organizational objectives. The investors should look for experienced and quality management before making any investment decisions in the company.
Industry’s Growth Potential: The investors should also assess the company’s growth potential before investing. It can be evaluated by going through the company’s annual reports and its fundamentals. The investor should attentively analyze the expansionist policy of the company and the demand of the product segments it offers.
Return on investment: The investor should analyze various ratios before landing on any investment decisions. The major ratios include ROCE( Return on Capital Employed) , EPS( Earning Per share), P/E (Price to earning ratio) and CFO/PAT ratio etc. These ratios will help the investor in assessing the company’s real growth and its operational efficiency.
Technical analysis: Though technical analysis of the company should be given less weightage from investment perspective,it could help the investors to find out accurate buying zones in the particular stock by analyzing it on a weekly and monthly time frame. Technical analysis helps investors to assess the current position of the company and they could correlate the same with its fundamentals.
Conclusion
Though these are the fastest growing stocks which are expected to provide higher returns to their investors in 2023, the source of risk always prevails in the market as it cannot be predicted with absolute accuracy. In this case an investor should go with those stocks which have higher accuracy to grow at an excessive rate in future. As a result, it is recommended that investors continue to track the aforementioned stocks by adding them to their respective watchlists, as these stocks have achieved higher accuracy as well as long-term demand.
