This article will explore a selection of high growth stocks in India in 2023 that are poised for long-term investment. In the previous article, we discussed about small cap stocks to invest in 2023 for long term gains.
Due to the fact that these stocks represent businesses with the potential for rapid future growth, investors frequently seek for growth potential stocks for investing objectives. Such businesses are typically located in areas or industries that are experiencing fast expansion. Due of the potential for larger returns compared to well-established firms, investors are attracted to these stocks.
Features of Growth Potential Stocks
Here are a few characteristics that high growth stocks often possess:
High growth stocks often have the potential for scalable business models. These companies can expand their operations efficiently without proportional increases in costs. Scalability enables rapid growth without compromising profitability. Companies with growth potential typically possess strong competitive advantages that set them apart from their peers. These advantages can include proprietary technology, patents, strong brand recognition, or a unique market position. Such advantages create barriers to entry and allow the company to maintain its growth trajectory.
Let’s explore the promising growth potential stocks in India for long-term investment in 2023. Fine Organic Industries Ltd, Asian Paints, Kotak Mahindra Bank, Apar Industries Ltd, IndusInd Bank, Andhra Paper Ltd, TVS Motor Company Ltd, Tube Investments of India Ltd, Power Finance Corporation Ltd, Indian Energy Exchange Ltd.
Now, let’s delve into a discussion of various high growth stocks in India that are well-suited for long-term investment in 2023.
Fine Organic Industries Ltd
The first stock in the list of high growth stocks in India in 2023 is Fine Organic Industries Ltd. The company specializes in the development of food and polymer additives. Additionally, it provides specialty additives for various applications including coatings, cosmetics, feed nutrition, and lubricants.
According to data from Future Market Insights (FMI), the plastic additives market will expand at a CAGR of 4.6% from now until 2032. The sector of packaging is principally responsible for this growth’s acceleration.
Currently, Fine Organic Industries Ltd is experiencing exceptional performance and is achieving its all-time high levels, indicating significant potential for future growth. It has seen a tremendous compound annual growth rate of 45.4% during the last five years. The business also maintains a respectable three-year average ROE of 36.0%, underscoring how well it uses shareholders’ money to boost profits.
Investors are particularly attracted to company due to its consistent growth in annual revenues, net income, and earnings per share. These positive financial indicators serve as a major draw for potential investors.
Earnings And Revenue
In the past year, the company witnessed a remarkable growth in annual revenue, which surged by 61.7% to reach Rs 3,087.1 Crores. Additionally, the company’s annual net profit experienced a significant increase of 138.1% to reach Rs 618 Crores.
The company announced earnings of 48.70 INR per share for the most recent quarter, above the consensus expectation of 47.34 INR per share. This results in a 2.87% positive surprise. However, compared to the expected number of 6.28 billion INR, the company’s revenue for the same time came to 5.97 billion INR.
Healthy financials makes the stock to examine more in detail.
Read about Cipla Fundamental Analysis: Riding The Growth Wave
Tube Investments of India Ltd
Next in the list is Tube Investments of India Ltd. The business is renowned in India for its manufacturing expertise, offering a diverse range of products that cater to vital sectors such as automotive, railway, construction, mining, agriculture, and more. It operates in three key segments: Cycles & Accessories, Engineering, and Metal Formed Products.
The Automotive Component Manufacturers Association of India (ACMA) has estimated that the auto components sector will see a revenue growth of 10-15% in the fiscal year 2023-2024. In the preceding fiscal year, the market observed a significant upswing of 23%, with a turnover of $56.5 billion in FY22. Additionally, industry projections indicate a further 15% increase in revenue by the conclusion of the current fiscal year.
By the fiscal year 2025–2026, the auto components market is anticipated to reach a value of US$ 200 billion. ICRA predicts that the income from vehicle ancillaries would increase by 8–10% in the fiscal year 2022–2023.
Tube Investment of India Ltd has demonstrated consistent EBIT margins over the past year, reflecting a positive growth trend. The company has continuously maintained a great ROCE of 20.70% over the last three years, showing a strong financial performance. Additionally, during the past five years, the firm has had outstanding profit growth, with a CAGR of 41.2%.
The company’s growing trend in yearly revenues, net income, and profits per share suggests that its future prospects are favourable. This steady expansion is a reflection of the strong success anticipated in the upcoming years.
Earnings And Revenue
In the previous year, the company experienced a significant increase in annual revenue, rising by 19.6% to reach Rs 15,108 Crores. The annual net profit also saw a notable growth of 24.3%, reaching Rs 955.6 Crores. Additionally, the stock price demonstrated exceptional performance by surging 97.1% and outperforming its sector by 54.7% over the past year.
The earnings for the last quarter are 14.10 INR whereas the estimation was 13.48 INR which accounts for 4.60% surprise. Company revenue for the same period amounts to 16.63B INR despite the estimated figure of 16.63B INR.
The company possesses stable growth history and manageable debt and knows very well the utilization of its assets. Further examination is recommended.
Power Finance Corporation Ltd
The third stock in the list of high growth stocks in India in 2023 is Power Finance Corporation Ltd. It is a Systemically Important Non-Deposit taking NBFC registered with the RBI as an Infrastructure Finance Company. It is engaged in extending financial assistance to the Indian power sector.
India’s financial services industry exemplifies economic progress and growth potential. With rising incomes, government focus on financial inclusion, and widespread digital adoption, the sector is expected to experience significant development until 2035. Projections indicate that India’s digital payments could surpass $1 trillion by 2030.
Power Finance Corporation Ltd. has consistently displayed a positive performance trajectory, achieving robust profit growth with a 5-year CAGR of 18.9%. The company’s high dividend yield of 6.72% and dividend payout ratio of 22.4% underscore its successful track record in recent times. Overall, these factors indicate strong financial success for Power Finance Corporation Ltd.
The company’s increasing annual revenue, net income, and earnings per share have become highly appealing to investors. These positive financial indicators serve as a key attraction for potential investors.
Earnings And Revenue
In the previous year, the company witnessed a 1.7% increase in annual revenue, reaching Rs 77,625.2 Crores. Additionally, the annual net profit saw a significant rise of 13.4%, totaling Rs 15,889.3 Crores. Moreover, the stock price exhibited exceptional performance, surging by 97.6% and outperforming its sector by 61.9% over the past year.
PFC reported strong earnings for the most recent quarter, with 13.23 INR per share, surpassing the consensus estimate by 11.18%. Furthermore, the company’s revenue for the same period exceeded expectations, reaching 40.46 billion INR.
Healthy financials makes the stock to examine more in detail.
Kotak Mahindra Bank Ltd
Kotak Mahindra Bank is a versatile financial services group that offers an extensive array of banking and financial solutions. Their offerings span across Retail Banking, Treasury and Corporate Banking, Investment Banking, Stock Broking, Vehicle Finance, Advisory services, Asset Management, Life Insurance, and General Insurance.
In the forthcoming years, there will be notable growth propelled by investments in infrastructure, innovation, and a strong emphasis on digital enablement, mobile banking, and internet banking. As projected by IBEF, the fintech market in India is expected to achieve a valuation of 6.2 trillion by 2025, underscoring the immense growth prospects within the industry.
Kotak Mahindra Bank has exhibited improved performance over the past years, navigating through market fluctuations. This serves as a valuable lesson for young investors, highlighting the inherent nature of market fluctuations. Despite occasional downturns, companies like Kotak Mahindra Bank are key players in the industry, emphasizing the importance of staying committed for long-term returns and sustained momentum. Profit growth remained at 19.3% CAGR over last 5 years and a NIM of 4.03% since last 3 years.
Investors find the company’s rising annual revenue, net income, and the upward trajectory highly appealing. These positive financial indicators act as compelling factors that attract potential investors to the company.
Earnings And Revenue
The company’s annual revenue increased significantly the year before, growing by 15.8% to reach Rs 68,384.3 Crores. Additionally, the annual net profit increased substantially by 23.5% to Rs 14,925 Crores. However, the stock price only increased little throughout that time, 10.8%, underperforming its sector by 24.8%.
The bank announced profits of 17.40 INR for the most recent quarter, beating the consensus estimate of 14.68 INR by 18.51%. Additionally, the company’s revenue for the same period exceeded expectations by reaching 82.89 billion INR.
The stocks deserve to be examined in detail.
TVS Motor Company Ltd
The business produces and sells automobiles, automobile parts, accessories, and home construction in addition to financial services.
By 2025, connected vehicles are likely to have a sizable market share of 53 percent, and by 2030, that percentage is predicted to rise to 77%, according to Ericsson (2021). These figures point to the automobile industry’s upward trajectory as it works towards a more promising and environmentally friendly future.
TVS Motors exhibits a promising future, as evident from its strong performance in the present day and over the past year. The company’s robust fundamentals position it as a formidable stock with the potential to achieve significant growth and generate favorable returns for investors.
The company’s increasing annual revenue, net income, and earnings per share serve as highly attractive features for investors. These positive financial indicators act as compelling factors that draw potential investors to the company.
Earnings And Revenue
In the previous year, the company experienced a significant surge in annual revenue, with a remarkable growth of 31.7% to reach Rs 32,112 Crores. Additionally, the annual net profit witnessed an impressive rise of 75.6% to Rs 1,328.7 Crores. Moreover, the stock price displayed a notable increase of 81.1% and outperformed its sector by 38.7% during the same period.
The company announced earnings of 8.60 INR for the most recent quarter, 16.88% more than the consensus estimate of 7.36 INR. Additionally, the company’s revenue for the same time exceeded expectations by reaching 66.05 billion INR.
With that, we conclude our discussion.
BOTTOM LINES
Investors tend to give attention to stocks with high growth since they frequently become well-known in the market. As demand and values rise, a bullish market environment and investor confidence may further fuel the stock’s ascent.
High growth stocks in India have the potential for larger profits, but they also come with a higher amount of risk than more established businesses. These stocks may display increased volatility and sensitivity to market movements since they depend more on projected future earnings than on actual performance.
Disclaimer
The blog is meant for informational purposes and serves the general analysis of the stocks. Contents provided here are based on careful research and analysis utilizing the fundamental and technical indicators over a period of time. The post does not consist any direct recommendation about Investing or trading in the securities market. Thorough research and careful consideration are necessary for individuals to fulfill their personal responsibility in making financial decisions. Seeking professional advice before making any financial decisions is always advisable.
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