Picking-up stocks in a rising market is never too easy. However, there are some stocks that have been beaten down badly and have the potential to rally. We have picked stocks like that which could be great long term stock pick in India.
Shares in Quickheal Technologies has slumped to a near 52-week low, as two quarters of performance have not been up to the mark and one reason for them was de-monetization. Quickheal Technologies is the largest anti virus software company in India, catering to retail, government and the private sector from mobiles to laptops to tablets. In 2016-17, the company sold 7.8 million anti virus licences as compared to 7.3 million in 2015-16. During 2016-17 the sales was almost flattish at Rs 3,329.8 million. Quickheal is a zero debt company with a huge cash flow and decent cash and bank deposits in hand.
Huge potential going forward for Quickheal
It is estimated that almost 50 per cent of Indian laptops and PCs do not have an anti virus software, which leaves enormous potential for the company to fill the gap. Quickheal is now collaborating with CERT to develop cyber security systems. CERT is the nodal agency responsible for dealing with cyber attacks in India. One of the big advantages for Quickheal is the significant presence in the anti virus space for the last 22 years, which includes 63 offices and a huge number of warehouses in the country. Recently, Quick Heal Total Security for Android (v2.01) was given 100 per cent malware detection by AV test results. Coming to the future growth prospects the company is looking at ongoing several new technologies such as IoT and home security automation.
Fundamentals of Quickheal in place
Quickheal has been reporting below par performances, but, one would expect them to soon start recovering. The company does not have any debt on its books, has surplus cash and a positive cash flow. It also pays a decent dividend of Rs 2.5 per share. For the full year 2016-17, the company reported an EPS of Rs 7.60. At the current market price of Rs 210, the p/e seems expensive at 27 times. However, we believe that Quickheal has the potential to rally based on performance, considering the huge demand potential and innovative products. A great long term stock pick in India. Check stock quote of Quickheal here
This is another stock that you should probably like. Coal India has been on a constant decline and has now hit a new 52-week low of Rs 261. At the current market price the stock is excellent on dividend yields. Even if the company declares a dividend of Rs 20 per share, considering a patchy performance, dividend yield may end-up at 8 per cent, which would mean returns higher than bank deposits. This makes the shares of Coal India an excellent play at the current levels. Buy the stock for the long to medium term for some tax free dividend yields. Check stock of Coal India here
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