36 stocks surge 100-900%; midcap, smallcap outshine in last one year

Since Christmas 2019, market not only formed new highs but crashed to multi-year lows only to to bounce back and reach new milestones. In all, the benchmak indices logged double-digit returns.

The broader markets, which had underperformed in 2018-2019, too, joined the bulls' party later in the year and reported more gains than frontliners.

The BSE Sensex and Nifty50 rallied 13 percent each, while the BSE Midcap and Smallcap indices climbed 19 percent and 32 percent respectively from Christmas 2019 to Christmas 2020.

"The year gone by was truly an unusual one for stock markets led by unprecedented COVID-19 crisis, where we have seen excesses on both the sides and a complete equity cycle in a very short span of time," Sanjeev Hota, Head of Research at Sharekhan by BNP Paribas told Moneycontrol.

All the credit goes to the liquidity, especially after global central banks announced trillion of dollars through stimulus measures to support the economy that was hit by the COVID-19 pandemic from February onwards. Also, FIIs invested more than Rs 1.5 lakh crore from last Christmas.

The hope of economic recovery going ahead after signs of improvement in data points in past few months following easing lockdown measures, better-than-expected September quarter earnings raising hope for strong growth in coming years, vaccine development, government's several stimulus measures and focus on Atmanirbhar Bharat, lower interest rates and RBI's supportive policy measures boosted sentiment so far.

All these things reflected in stocks and sectors performance. Majority of key sectors, barring Bank and Oil & Gas, participated in the rally.

About 65 percent of stocks in the BSE500 index closed in positive terrain, and more than 50 percent stocks reported at least double-digit gains since last Christmas.

The top 36 stocks turned multibaggers from last Christmas, reporting 100-900 percent gains. Most of these stocks were from the midcaps and smallcaps space.

Tanla Platforms, Adani Green Energy, Aarti Drugs, Laurus Labs, IOL Chemicals, Alkyl Amines Chemicals, Birlasoft, Dixon Technologies, IndiaMART InterMESH, Granules India, Navin Fluorine International, Affle India, JB Chemicals, Adani Gas, Adani Enterprises, Amber Enterprises, APL Apollo Tubes, Tata Elxsi, Divis Laboratories, Mindtree, L&T Infotech and Escorts were among those 36 stocks.

Majority of these stocks were from healthcare, technology and speciality chemicals, which benefitted most from the COVID-19 pandemic. The rising importance to health and strong deal traction post-pandemic boosted these sectors respectively.

The next 74 stocks in the BSE500 index registered more than 50 percent rally since last Christmas. These include Advanced Enzyme Technologies, Alembic Pharmaceuticals, Aurobindo Pharma, Syngene International, Jindal Stainless, Cadila Healthcare, Ipca Laboratories, Bajaj Electricals, Info Edge India, Mphasis, Apollo Hospitals, Jubilant Foodworks, Infosys, Gujarat Gas, Biocon, HCL Technologies, IRCTC, Muthoot Finance, IRB Infrastructure, Tata Chemicals, PI Industries, Wipro and MCX.

On the other side, the majority of PSUs and banks, NBFCs, hotels and retail stocks are still trading in the red. Future Retail, GE Power India, Punjab National Bank, Union Bank of India, Raymond, Canara Bank, Chalet Hotels, IndusInd Bank, Bank Of Baroda, Lemon Tree Hotels, Shoppers Stop, Edelweiss Financial Services, RBL Bank, Indiabulls Housing Finance, Jagran Prakashan, DCB Bank, Coal India and Ujjivan Small Finance Bank are among 27 stocks which corrected more than 30 percent from last Christmas.

The year ahead is expected to see a strong recovery in earnings, as well as economy, and the market can give another double-digit gains by next Christmas, experts feel.

"My reading of market for the year gone by is nothing stays forever and what really counts is a structural pillar of strength rather than transient headwinds," Sanjeev Hota said.

"But there could be intermediate corrections and hurdles in-between, which I believe is healthy for the market. So, overall, I continue to remain constructive on equity as the best asset class for investments in the long term," he added.

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