5 Blue Chip Stocks All-Time Gains Range From 1400% to 1,43,500%; Infosys, RIL, HDFC Bank In List; Time To Buy?

Blue chip stocks are a list of equity shares belonging to well-established, financially-sound and large firms. Blue chips are a popular investment strategy for long-term wealth creation. That being said, heavyweights and famous blue chip stocks Reliance Industries, Tata Consultancy Services (TCS), Infosys, HDFC Bank, and Hindustan Unilever (HUL) are among the best stocks to buy in 2023 for the long-term run. These top five behemoths in terms of market share have their all-time gains ranging from 1,400% to a mind-boggling nearly 1,44,000% in less than 3 decades.

According to Groww's blog, RIL, HUL, TCS, Infosys and HDFC Bank are among the best shares to buy in India for the long-term in 2023. The rationale for cherry-picking these stocks is based on market capitalisation being more than Rs 10,000 crore and over 10% growth in profitability for the past three fiscal years.

Ace investor Warren Buffett, who is often seen by the world as the 'Oracle of Omaha', has been suggesting to always invest in the long-term. Among his many famous quotes for long-term investment would be "If you aren't willing to own a stock for ten years, then don't even think about owning it for ten minutes." The billionaire whose stock investment has been a success story to learn from, also once said, "I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years."

That being said, these five large-cap blue chip stocks account for more than 17.5% of the overall market value of BSE-listed firms as of now. RIL topping the chart, with TCS and HDFC Bank following closely.

And let us not forget, their performance has been stellar on a long-term basis on BSE with Infosys outrunning the remaining four.

Should you still buy in these blue chip stocks?

1. Reliance Industries (RIL):

On August 1st, RIL shares traded at Rs 2526.95 apiece, down by Rs 20.90 or 0.82% on BSE, at the time of writing. Its market cap was nearly Rs 17.10 lakh crore at the current price level.

However, RIL's year-to-date performance is dull with a downside of nearly 2% on BSE. But in 5 years, the Mukesh Ambani-backed stock is a multi-bagger with nearly 117% rise as of now. Its all-time high is even spell bounding to at least a massive Rs 2,503 or 10,206% upside since mid-1995.

During Q1FY24, RIL's consolidated net profit that is attributable to owners stood at Rs 16,011 crore, declining by 10.83% YoY and 17.03% QoQ. Also, revenue from operations was under pressure as it fell by 5.31% YoY and 2.51% QoQ to Rs 210,831 crore.

RIL stock still has the potential to rise by over 16% in the near term. Post the Q1 results of RIL, Motilal Oswal in its report said on the company, "We value the Refining and Petrochemical segments at 7.5x EV/EBITDA, arriving at a valuation of INR904/share for Standalone business. We ascribe an equity valuation of Rs 750/share to RJio and Rs 1,500/share to Reliance Retail, factoring in the recent stake sale. We have further included an equity valuation of Rs16/share pertaining to New energy on book value. Our TP is adjusted for Jio Financial Services (JFS) valuation. We reiterate our BUY rating with a TP of Rs 2,935."

2. Tata Consultancy Services (TCS):

This Tata Group-backed flagship firm is the second-largest company and the largest IT firm in India in terms of market share. Unlike RIL, TCS traded with nearly 1% upside on BSE to Rs 3454.25 apiece on Tuesday. Currently, its market cap is nearly Rs 12.64 lakh crore.

Year-to-date, TCS stock has advanced by nearly 6%. But the 5-year performance is an upside of nearly 75%. However, since its listing in August 2004, TCS has skyrocketed by Rs 3,334 or 2,771.44% on BSE as of now.

TCS has the potential of a further upside of more than 13% on BSE.

KR Choksey Institutional in its report dated July 14 said, "Despite persistent global macro uncertainties, TCS is well positioned with its size, steadfast market leadership position, best-in-asset class execution and order book (especially exposure to longer duration contracts) to deliver industry-leading growth/margin and demonstrate superior return ratios and hence we have changed our target price as Rs 3,915 (Previously the target price was INR 3,888) with a P/E multiple of 27.0x to the FY25 with an estimated EPS of Rs 145."

Brokerage Geojit's research report on TCS said revenue growth may remain subdued in the near term. However, a healthy orderbook, strong execution capabilities, sustained focus on cost optimisation and robust demand for generative AI augur well for the company's long-term performance. It has set a target price of Rs 3,879.

Meanwhile, IDBI Capital's note post earnings said, "We expect TCS to be a key beneficiary considering the client profile and the recent large deal wins. In addition, the shift of consumers to larger banks (TCS's clients) and healthy deal pipeline (US$10.2 bn, book to bill of 1.4x) will drive medium-term growth. This coupled with the company's focus on technologies like 5G, IoT, generative AI, virtual reality /metaverse, and digital twin will drive long-term growth. We have built in a Revenue and PAT CAGR of 7.7% and 11.6% over FY23-25E." The target price is Rs 3,740 on TCS by the brokerage.

3. HDFC Bank:

HDFC Bank is the third largest firm and largest bank in terms of market share in India. The stock traded at 1% upside to Rs 1,665 apiece on BSE.

HDFC Bank which recently merged its parent HDFC under its ambit, has a market value of Rs 12.55 lakh crore nearly at present.

Year-to-date, HDFC Bank's share price has gained by single-digit 2%. But in a year, the upside is over 15% on BSE, and it has gained by nearly 57% in 5-years. Since April 1996, HDFC Bank's all-time high is Rs 1,658 or 48,337% on the exchange.

HDFC Bank is seen to rise by more than 26% ahead. In its latest report dated July 31st, Jefferies said, "Our review of HDFC Bank's FY23 annual report in context of merger points: (1) deposit/ branch has been flat for 3yrs as share of

4. Infosys:

This Pune-headquartered tech player is the second-largest IT firm in India. On Tuesday, the stock traded at Rs 1362.40 apiece, up by 0.54% on BSE. Its market cap is over Rs 5.65 lakh crore.

But Infosys' stock performance is far greater and eye-catching than other large-caps.

Although, Infosys' 2023 performance so far is in red with a drop of 10.5% on BSE, its 5-year performance makes the company a multi-bagger with around 100% upside on the exchange. But this IT giant's all-time performance is a rise of Rs 1,363.40 or 143,515.79% on BSE.

The impressive performance of Infosys stock is expected to continue as the shares is seen to rise over 27.5% in the near term.

Religare Broking in its report said, "We believe in the near term the challenges on macro front, delay in spending & decision by clients would continue to impact growth for Infosys. Also, management cautious view and downwards revision in revenue growth guidance remains a concern. Incorporating the management revised guidance our estimates are cut by 4-5% for FY24E & FY25E and our revenue /EBIT in rupee term is expected to now grow by 7.2%/10.6% CAGR over next 2 years. Thus, our target price is revised downwards to Rs 1,738 from earlier Rs 1,855 but we maintain a Buy rating."

5. Hindustan Unilever (HUL):

HUL is the largest FMCG player with a market cap of over Rs 5.99 lakh crore as of now. The stock traded lower by 0.44% on Tuesday at Rs 2550.35 apiece on the exchange.

The year-to-date performance is muted in HUL stock price. However, the stock has jumped by nearly 45% in 5-years. But, the stock's all-time performance is robust with over 1,435% upside on BSE since January - 1999.

HUL shares have potential to rise nearly 14% on BSE ahead.

Brokerage Geojit in its latest report said, "HUL is able to gain market share in 75% of its business through premiumisation and sustained efforts to improve operational efficiency. Healthy volume growth in urban regions and positive volume growth in rural areas look promising in the near term. Moreover, the recent fall in key raw material prices - palm oil and crude oil - would support volume growth in the coming quarters. The stock is currently trading at 48.1x P/E on FY25E adjusted EPS. This is lower than the 5-year historical average of 58x. We, therefore, reiterate our BUY rating on the stock with a target price of Rs. 2,900 using a target multiple 54x P/E on FY25E adjusted EPS."

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns. in advises users to consult with certified experts before making any investment decision.