The Sensex and the Nifty are at near record highs and the year 2019 has been good and is likely to end well. However, stocks from sectors like automobiles, did not perform very well during the course of the year. Here are 4 Sensex stocks that generated poor returns when compared to a year ago.
The shares of Yes Bank, exactly a year ago were trading around that Rs 180 mark. Today, the shares change hands at around Rs 47, which no investor would have envisaged a year ago. A collateral damage in the stock, thanks to swelling non-performing assets, leading to losses and subsequently a severe price erosion.
Investors continue to remain worried over the bank's fund raising plans. There have been some investors, but, not really the marquee investors who are willing to invest in the bank. The overhang on the stock is likely to remain, unless funding plans of at least $2 billion or thereabouts are cleared.
Mahindra and Mahindra
Exactly around the same time this year, the shares of Mahindra and Mahindra were trading around levels of Rs 760. Today, the stock trades at just Rs 511, which is also very close to its 52-week low of Rs 502. Mahindra and Mahindra continues to remain a very strong company and the problem right now is with the economy. Remember, it is the world's largest tractor manufacturer and has a dominant position in India.
The economy is in bad shape, however, when the same recovers and rural income improves, we might see the company's performance improve and hence the stock price.
This is another stock that has taken a hit because of the slowdown in the economy. The stock was quoting at Rs 3,200 a year back on Dec 17, 2018. Exactly, a year down the line, the stock has plunged to Rs 2,300, resulting in significant price destruction. Hero MotoCorp is the world's largest two wheeler manufacturer and has been badly hit by the slowdown in the Indian economy.
Rural India has been slowing fast and this has impacted players like HeroMotor. However, as with the case of Mahindra and Mahindra, as and when the economy revives we will see the shares too rally.
Vedanta is a major mineral, mining and oil exploration company. A slowdown has hit the company as well and generally speaking metal stocks have gone nowhere in the past one year. The shares, which were around Rs 214 a year ago are now down to Rs 151.
The company's shares are a good pick in terms of dividend yield.
Its is highly likely that in 2020 the laggards may outperform other performers of 2019. In some cases the stock prices have fallen so sharply, they may offer value at these levels. Stocks like Mahindra and Mahindra and Hero MotoCorp are the world's biggest companies in their respective fields. I think it would be foolhardy to chase the performers and some private sector banking names have become simply too expensive. You might just about find value in the stocks mentioned above.