Baap of all multibaggers! 7 insights from the history of 100-bagger stocks
Topping the list is PI Industries, whose stock has compounded at a gravity-defying CAGR of 55% to 6,485 times. KEI Industries has grown over 3,300 times, Bajaj Finance 1,336 times, Titan 859 times, Relaxo Footwear (584 times) and Havells India (568).
Other top wealth creators in the list include Deepak Nitrite, Balkrishna Industries, Navin Fluorine, Hatsun Agro, UPL, Kajaria Ceramics, Shree Cement, UPL, Eicher Motors, Atul, Kotak Bank, Pidilite Industries, Trent and Asian Paints.
«Business models that flourish during economic upcycles and preserve value during downturns can be labelled as ‘through-the-cycle’ (TTC) compounders.
Most of the stocks that constitute this list hail from traditional manufacturing sectors – commodities (chemicals, cement, etc.), building materials, home appliances, capital goods, engineering, discretionary consumption, staples, pharma, etc. A few TTC 100-baggers emanate from the services sector such as financials and rating agencies,» ICICI Securities analyst Vinod Karki said.
The domestic brokerage firm, in its report, divided the cycle into three phases.
In the first cycle investors reaped the benefits of a booming investment and real estate cycle between 2003–2010 while the second cycle from 2011-2021 belonged to low earnings volatility and quality stocks.
«The benefitting stocks in this set saw their P/Es swell from sub-30x level to reach >70x by 2021. That said, they are currently observing a reversal of the trajectory, as the next cycle is being driven by the investment rate,» it said.
The ongoing third cycle, which began from FY21, is again being driven by capital-intensive and cyclical stocks as the investment cycle again starts to pick up after a decade.
For the purpose of this study,
