Best shares to buy for long term in india in 2023

In this blog, we are going to continue our previous article. We were discussing about the best shares to buy for long-term investment in India in 2023. We have already discussed about Polycab India Ltd and ICICI Bank Ltd in detail in the previous article. In this post, we will be continuing discussing our remaining three stocks which are among the 5 best stocks to invest in 2023 for long term: Asian Paints Ltd, Astral Ltd and AU Small Finance Bank.

ASIAN PAINTS Ltd.

The enterprise manufactures and markets paint and coating materials. Paints and home improvement are two of the main segments through which it works.

According to the Indian Paint Association (IPA), the paints and coatings market in India is projected to expand from its current size of Rs 62,000 crore to Rs 1 lakh crore over the next five years. The IPA expects the capacity of the Indian paint industry to increase by 2.5 million kilolitres, which corresponds to approximately 20% of the existing capacity, within the next three years.

Asian Paints, a market leader in its segment, holds approximately 59% of the total market share, making it a significant player. This substantial number indicates the company’s dominance in the industry. Experts anticipate an annual increase in demand for the paints and coatings industry ranging from 11 to 13 percent.

In the last three years, stock prices have increased by almost 25%, while profits have increased by a respectable 15.60% CAGR during the same period. The Return on Equity of the company stands at 27.12%. The company has effectively maintained a strong dividend payout of 58.4%, showing that it hasn’t lagged behind in this area.

Earnings and Revenue

ASIAN PAINT earnings for the last quarter are 12.87 INR whereas the estimation was 11.75 INR which accounts for 9.53% surprise. Company revenue for the same period amounts to 87.87B INR despite the estimated figure of 87.59B INR.

In comparison to the estimated sales of 95.57 B INR, the predicted earnings for the following quarter are 12.96 INR.

Summing up, Asian paints Ltd is a debt free company with healthy profitability ratios. That is, ROCE-35.2%, ROE- 27.7% and a good revenue growth of 20.49%, makes it an ideal company to study further.

ASTRAL Ltd

The fourth stock in the list of best stocks to invest in 2023 is Astral Ltd. Plumbing and pipe systems are produced and marketed by the company, and they’re used in both residential and commercial applications. Plastic Products and Adhesives comprises its two business units.

Since, India is an under construction company, the Indian plastic pipe market is expected to experience a compound annual growth rate (CAGR) of 10.3% from 2022 to 2027, resulting in an estimated value of $10.9 billion- Times of India reports. By FY 2025, the sector is expected to witness a slightly accelerated growth rate of 11% and achieve a market value ranging between Rs 550 billion and Rs 600 billion.

ASTRAL Ltd is India’s top-rated PVC pipe manufacturer. The company commands a market share of approximately 9% in India’s plastic and infra pipes segment. Furthermore, it possesses a market share of around 4% in the adhesives segment within the country.

Over the past three years, the company has witnessed a significant surge in stock prices, with an impressive growth of nearly 58%. Concurrently, profits have displayed a commendable Compound Annual Growth Rate (CAGR) of 22% during the same period. The company’s Return on Equity stands at a solid 21%. Additionally, the dividend history of the company has experienced a notable increase, rising from 4% in FY19 to 13% in FY23.

Earnings And Revenue

ASTRAL reported quarterly earnings of 7.70 INR, surpassing the average estimate of 2.94 INR by a significant 162.13%. In contrast to the anticipated total of 14.81B INR, the company’s revenue for the same period amounted to 15.06B INR.

The next quarter is projected to yield estimated earnings of 5.14 INR, while the revenue is anticipated to reach 13.78B INR.

Summing up, ASTRAL Ltd is a debt free company with healthy profitability ratios. That is, ROCE-25.1%, ROE- 17.7% and a good revenue growth of 21.59%, would definitely want you to have a good look at it.

AU Small Finance Bank Ltd

The last stock in the list of best stocks to invest in 2023 is AU Small Finance Bank. The company actively provides banking services and operates through several segments, which include Treasury, Retail Banking, Wholesale Banking, and Other Banking Operations.

Small Finance Banks (SFBs) in India have shown significant growth potential since their establishment in 2015. SFBs have tremendous potential to evolve in the coming years and the surge will be backed by various factors such as: expanding banking services to the unbanked and underbanked regions of India, a distinct market focus, addressing the specific requirements of micro and small businesses, low-income individuals, and segments that have been financially excluded, technological advancements, regulatory support, funding opportunities, diversification of products and services, and etc.

In terms of small finance banks, AU Small Finance Bank has attained the top spot. The SFB’s advancements have increased year over year by 26.74%, outpacing the CAGR of 20.69% over the previous five years. The company has outperformed the Nifty 100 index over the past three years, returning 228.05% as opposed to the index’s performance of 797.80%.

Over the past three years, the company’s stock prices have surged remarkably, demonstrating an impressive growth of around 49%. Concurrently, the company has achieved an admirable Compound Annual Growth Rate (CAGR) of 28% in profits during the same period. The company’s Return on Equity remains robust at 19%. Moreover, the company’s dividend history has experienced a notable increase, rising from 3% in FY2021-22 to 5% in FY2022-23.

Earnings And Revenue

AUBANK’s quarterly earnings came in at 6.37 INR as opposed to the estimate of 6.25 INR, representing a 1.97% surprise. Despite the anticipated value of 15.46B INR, the company’s revenue for the same time is 15.46B INR.

15.29B INR in sales and 6.65 INR in profits are projected for the upcoming quarter.

Summing up, Over the past three years, the company has consistently expanded its net interest margin, achieving a margin of 4.9% in the previous year and recorded good profit growth of 37.3% CAGR over last 5 years. Also, it has maintained a healthy profitability ratios, that is, ROCE-8.54 %, ROE- 19.0 % ROA of 2.06%. Given these factors, a detailed examination of the stock is warranted.

So these are the 5 best stocks to invest in 2023 for long term. We have discussed in detail about what makes these the best stocks to invest in 2023. While we understand that the market can be unpredictable, with its ups and downs, a smart investor is someone who remains patient and is willing to take risks in pursuit of significant long-term gains.

Thank You!

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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 and the use of 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.