We know by now that Motilal Oswal’s Wealth Creation Studies are not
meant to be taken lightly. Each of the stocks referred to therein are
chosen after careful application of mind to the fundamentals and
valuations and have the potential to give mega gains.
The
18th Wealth Creation Study
of 2014 recommended five stocks. Four of these stocks, namely,
Symphony, Bajaj Finserv, Bajaj Corp and Zydus Wellness, have given
blockbuster returns to shareholders since then.
The
19th Wealth Creation Study
of 2015 recommended seven stocks. Five of these stocks, namely, Tata
Elxsi, Granules India, Shilpa Medicare, Aarti Drugs and Atul Auto have
given handsome returns since then.
The
20th Wealth Creation Study of 2016
is conspicuously silent with regard to the names of the recommended
stocks. This appears to be a deliberate strategy by the think tank at
MOFSL for reasons that are best known to them.
However, Mr. Motilal Oswal, the boss man of MOFSL, has let the cat out of the bag by naming these stocks.
In his latest
interview, when he was asked to recommend a few multibagger stock ideas, Motilal Oswal blurted out:
“
What are your top five multibagger ideas for 2016 with a minimum investment horizon of three years?
Motilal Oswal: Bajaj Finance, Sun Pharma, SBI, ONGC, and
InterGlobe Aviation are the five largecap stocks to watch out. Among the
smallcaps, I would bet on Alkem Labs, DFM Foods, Astra Micro, Eveready
and Lincoln Pharma.”
| Motilal Oswal’s “Mid to Mega” Stocks |
| Stock |
CMP (Rs) |
MCap (Rs Cr) |
| DFM Foods |
970 |
971 |
| Eveready |
302 |
2,197 |
| Astra Micro |
137 |
1,191 |
| Alkem Labs |
1533 |
1,544 |
| Lincoln Pharma |
251 |
409 |
The first thing worth noting is that of the five small cap stocks
referred to, two are Pharma stocks. This is not a coincidence. Even in
the 19th Wealth Creation Study, four of the seven stocks were Pharma
stocks.
Of the five stocks, DFM Foods is somewhat familiar. This stock was first
recommended by Ekansh Mittal’s Katalyst Wealth
on 19th April 2015 when it was at Rs. 322. Today, the stock stands tall
at Rs. 970, resulting in eye-popping gains of 200% in just nine months.
DFM Foods’ credentials as a quality stock are established by the fact
that Westbridge/ Jwalamukhi holds a massive chunk of 25% of the equity.
It is worth noting that 82.18% of DFM Foods’ equity capital is
collectively held by the promoters, Westbridge/ Jwalamukhi and two other
HNI shareholders.
This means that there is really no floating stock available for sundry shareholders.
It may be recalled that Sumir Chadha, the whiz-kid behind Westbridge/ Jwalamukhi, had
revealed that it is his strategy to corner large stakes in top-quality small cap stocks because this results in “
mis-pricing” of the stock.
Eveready is also mildly familiar because Ashish Kacholia holds a
major chunk in it. Akash Prakash’s Amansa Capital also bought a chunk of
5,48,000 shares of Eveready on 06.11.2015.
Astra Micro is of the same top-quality caliber. It happens to be one of
Sanjoy Bhattacharrya’s favourite stocks and had pride of place in his famous Model Portfolio.
There is a
detailed research report on Astra Microwave by Oscar Capital. The report explains how Astra’s expertise in the Defense sector coupled with the Government’s ‘
Make in India’ will bring great prosperity to the Company.
Amongst the Pharma stocks, Alkem Labs made its IPO debut a few days
ago. The IPO was highly recommended by most brokerages on the basis of
the Company’s powerhouse track record and reasonable valuations.
Lincoln Pharma is a mystery stock that has never been heard of
before. Preliminary inquiry reveals that the stock is a micro-cap with a
market capitalisation of Rs. 409 crore. It has been a powerhouse so far
with a mind-boggling return of 213% YoY and 625% in two years.
The interesting aspect is that none of the super-savvy investors
appear to have discovered Lincoln Pharma so far. There are also no
research reports on the stock so far.
So, of the five stocks referred to by Motilal Oswal, Lincoln Pharma appears to be the perfect “
hidden gem” to take us to the road of riches if we are able to muster the courage to buy a truckload of the stock!
