Nifty hits record high again: 1 in 3 stocks returned more than 100% in last 1 year

Investors, who had bought shares during the May-August period of last year and decided to stay put through the election uncertainty, can rejoice asthey must have more than doubled their money by now.

A Firstbiz analysis of the surge in the Indian stock market over the last one year (20 August 2013 to 20 August 2014) has shown that every third stock on the bourses returned more than 100 percent during the period.

In absolute terms, as many as 774 scrips, or 35 percent, of the total 2,200 actively traded stocks have risen between 100 percent and a mind-boggling 2,511 percent during the period.

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Going by the rising trend in the stock markets, now there are another 91 stocks that will get added to the list as they are now giving returns between 91 percent and 99 percent. That will take the total tally to 865 or 39 percent of the total traded stocks.

The performance of these 774 shares are commendable considering the return from the benchmark indices Sensex and Nifty was just 45 percent.

What has aided the stock market performance is an improvement in the macroeconomic condition, especially the current account deficit (CAD).

Awidening CAD last year, due to a surge in gold imports with people frantically buying the yellow metal to beat a spiralling inflation, had resultedin apanic withdrawal of funds by foreign investors. What aggravated the situation was the US Fed’s signal that it may start tapering down of its stimulus sooner than expected.

An unprecedented fall in the rupee against the dollarhadpushed the UPA government to bite the reform bullet and also curb gold imports, resulting in a betterment of CAD situation and other macro indicators.

Appointment of eminent economist Raghjuram Rajan as the RBI governor and his progressive steps also helped improve the sentiment.

Now the hope is that the Narendra Modi-led government will take forward the reforms initiated by the UPA.

As per the analysis, among indices, only the BSE Capital Goods Index clocked 107.3 percent return during the period. The BSE Small-cap Index was just shying away of 100 percent mark at 96.5 percent.

While there were six stocks among Nifty constituents that logged more than 100 percent gains, one-fifth or 20 stocks of the BSE 100 Index rose more than 100 percent (see table below).

Baba Kalyani-owned Bharat Forge, with 243.9 percent return, emerged as the major gainer among the BSE 100 Index. Its share price jumped from Rs 220.55 on August 20, 2013 to Rs 758.45 on August 20, 2014.

Gautam Adani-controlled Adani Enterprises, ranked number two, gave 209.3 percent return during the period. Mumbai-based realtor HDIL at number three with 204.5 percent rise in its share price.

The other notable companies which gave three-digit returns include Ashok Leyland (up 182.8 percent), HCPL (up 146.6 percent), JSW Steel (up 146.3 percent), Crompton Greaves (up 142.7 percent), Power Finance Corporation (up 140.7 percent), YES Bank (up 140.1 percent) and Adani Ports (up 129.5 percent).

The sectoral analysis of these 774 companies, showed that maximum shares (58 stocks) were from the financial services sector. It was followed by capital goods companies (54), information technologies (52), textiles (50), Chemicals (48), auto ancillaries (43), pharmaceuticals (41) and steel (32).

The stock that gave the breath-taking 2511 percent return was Exdon Trading Company, a small-cap. Its share price shot up to Rs 84.60 now from Rs 3.24 a year ago. There were other six firms that gave more than 10-fold returns to the investors, namely Vishvjyoti Tradging (up 1748 percent), Kiri Industries (up 1716 percent), Alphageo (India) (up 1459 percent), Radha Madhav Corp (1343 percent), Lifeline Drugs and Pharma (1333 percent) and Mishka Finance (1106 percent).