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At the time when market watchers are advising investors to book some profit at higher levels, retail investors seem gung ho on select stocks across sectors. Data showed that more than one lakh small investors entered at least 18 companies during the quarter gone by. With the addition of 4.31 lakh investors, FMCG major ITC emerged as the top choice of small investors. Shares of the company have declined by over 5% since the beginning of the ongoing financial year. It was followed by Tata Power (4.03 lakh), Reliance Power (2.74 lakh), Amara Raja Batteries (1.73 lakh) and IDFC First Bank (1.62 lakh).
Shares of IDFC First Bank and Amara Raja Batteries have declined 8% and 16%, respectively, since April 1 this year. On the other hand, Tata Power and Reliance Power have gained 18% and 195%, respectively, during the same period.
Brokerage Sharekhan sees a 25% upside in Tata Power.
“Tata Power’s focus on business restructuring and balance sheet deleveraging plan would play a crucial role for sustained improvement in earnings profile and improve investor confidence,” it said.
More than 1.56 lakh additional retail investors entered Jaiprakash Power Ventures during the April-June period. Telecom player Vodafone Idea and IT firm Happiest Minds Technologies witnessed an increase of 1.53 lakh and 1.35 lakh number of retail investors. As of June 30, there were 16.85 lakh small investors in Vodafone Idea, while Happiest Minds Technologies had 3.38 lakh.
Indian Energy Exchange, Motherson Sumi, HFCL, HCL Technologies, Subex, Deepak Nitrite, Suryoday Small Finance Bank, Tata Chemicals, Mahindra & Mahindra Financial Services and Aarti Industries stood among other players in which 1.04-1.27 lakh new investors entered for the quarter ended June 30.
Commenting on Subex, ICICIdirect in an earlier report said that the company historically made acquisitions, which impacted its financials and led to higher debt. It also led to the exit of its founders. Over the years, the company has managed to reduce debt significantly and stabilised its operations.
Going forward, Subex believes it can grow its core business (around 95% of revenues) at 10% while remaining (5% or $2 million) new business is expected to grow to $18 million in coming years. “We believe the company is poised to grow at a CAGR of 18-20% in coming years,” ICICIdirect said in a report.
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