Shares have rallied a bit in the last one week, with the Sensex now nearing the 27,000 mark, after scaling 26,000 points in the last 1 week. We have picked select shares, some of which are very niche players. These are stocks that have the potential to double money in the long term (at least 5 years).
This company is a leader in the anti virus software market in India. The IPO of the company was priced at Rs 320 and the stock is now available at just Rs 230.
Apart from this it is a debt free company that is generating good cash. The company is likely to grow rapidly in the years to come given the fast expanding use of internet over mobile and desktop. The stock has the potential to double investor money in the next 5 years.
Many may say it is not the best time to be recommending banking stocks. But, you should buy stocks when they are in the worst possible phase, as you get stocks at distressed valuations. The PNB stock has almost halved from levels of Rs 150 to current levels of Rs 80. We believe that in the next few quarters banking woes would have ended and asset quality could improve dramatically. Banking stocks thus have the potential to turnaround making PNB an attractive pick.
Eros Entertainment is a leading distributor and producer of films. The stock of Eros has dropped from levels of Rs 600 to the current level of Rs 207. The stock has fallen after doubts were raised over the accounting standards adopted by the company. Eros subsequently clarified. However, it is a solid niche player and is likely to report an EPS of Rs 15-20, next year. This makes the stock at just 10-15 times next years earnings, leaving enough scope for a rally.
Like PNB, we believe that at some stage, Canara Bank would see a recovery in asset quality. When that happens we may not get the stock at the current price of Rs 190. It has been a better managed PSU bank, with a better control over asset quality as compared to peers.
Coffee Day Enterprises
Coffee Day Enterprises, runs the popular Cafe Coffee Day Chain. The stock has fallen from its IPO price of Rs 328 to the current price of Rs 260. The company is a solid play on India's urban consumption story with a rapid expansion plan. We believe that the solid brand of Cafe Coffee Day, rapid expansion and a burgeoning middle and upper middle class population should drive performance at the company.
Healthcare Global Enterprises
Healthcare Global Enterprises (HCG) like Coffee Day Enterprises, is available at below its IPO offer price of Rs 218.
The company runs the popular HCG brands of cancer hospitals in the country.
Under penetration of healthcare, particularly speciality cancer hospitals, could drive growth at the company.
The company also runs Milann fertility clinics. For investors who have the patience this stock has the potential to double in the next 5 years.
At Rs 300 Coal India offers you a dividend yield in excess of 6 per cent. This means that the yield is better than bank deposits, if one goes by post tax yields. The company has ambitious expansion plans, making it a good bet at the current levels.
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