9 High Quality Stocks Near 52-Week Lows, Should You Buy?

Markets this week gave-up some of the gains that we seen earlier this week. Despite the first two days of the week being robust, some stocks lost ground. Here are a few stocks that are now very near to their 52-week lows. All of these are high quality stocks. Let's see whether you should buy these stocks.

List of stocks near 52-week lows

Name	Current market price	52-week low price
HDFC	Rs 2503	Rs 2394
Colgate Palmolive	Rs 1455	Rs 1375
IGL	Rs 396	Rs 386
MRF	Rs 70,000	Rs 68,700
ICICI Lombard	Rs 1364	Rs 1305
Mahanagar Gas	Rs 842	Rs 793
L&T Finance Holdings	Rs 75	Rs 70
HDFC Life	Rs 624	Rs 615
Kansai Nerolac	Rs 541	Rs 521

 

Should you buy HDFC and Colgate stock at near 52-week lows?

There is no doubt that all of these stocks are bluechip stocks. Let's look at each individual stock. The problem with the HDFC stock is that the company is heavily owned by Foreign Portfolio Investors and these set of investors are selling Indian stocks on rising bond yields in the US.

Interestingly, bond yields rose sharply in the US on Friday, which means there could be more selling in the HDFC stock on Monday. Fundamentally, nothing wrong with the company, though growth rates are going to be much lower than in the past.

Colgate has been plagued with problems of higher input cost, subdued demand and huge competition.

Should you buy the IGL and MRF stock at 52-week lows?

IGL has been plagued by new norms. According to a report, the Delhi government recently notified a draft "aggregator's policy" under which ride aggregators and delivery services will have to mandatorily adopt electric vehicles while procuring new fleet. Aggregators and delivery services would need to ensure 10 per cent of all new two-wheelers and 5 per cent of all new four-wheelers are electric in the next three months. This is obviously going to hit a CNG player like IGL.

MRF on the other hand is seeing growth plateuing and input costs rising.

Should you buy HDFC Life and L&T Finance Holdings?

The stock of HDFC Life has been falling for sometime now. The company is in the fiercely competitive business of insurance. L&T Finance Holdings on the other hand did put-up a good performance for the quarter ending Dec 31, 2021. The company saw a 12 per cent increase in its net profit to Rs 326 crore for the quarter ended December 2021. However, gross non performing assets at the company rose to 5.91%, which is high. .

As for the other stocks, we believe that Kansai Nerolac will see input costs soaring, while we do not have a view on Mahanagar Gas. If you are looking to buy stocks and add to the portfolio we would recommend HDFC, purely on account of its strong pedigree and holdings in HDFC Bank, HDFC Life etc.

Disclaimer

Investing in equities is risky and investors must therefore understand the risk. The author and Greynium Information Technologies Pvt Ltd would not be responsible for any losses caused based on the article. The author and his family do not hold shares in any of the companies mentioned above. Investors should exercise caution on account of heightened volatility in the markets currently.