Decade is a very long period in the globalised business environment. Top companies which fail to adopt to the ever changing business dynamics will be replaced by new companies with strong dynamic management. “Looking back” sometimes gives valuable information about future trends. I compared the top Indian companies by market capitalization in 2008 Vs 1998. Except Reliance and ONGC, none of the top 10 companies in 1998 made it to the top 10 list in 2008. It is surprising to see how fast the emerging companies are replacing the old giants! We as investors always look to find out those companies to make big gains over long term. Blind long term investment without proper strategy will only ruin your financial health.
Important statistics about 1998:
1. Inflation was around 3.5%.
2. Third most attractive investment destination after Brazil and Mexico – Morgan Stanley.
3. 1 Dollar= 39 rupees.
4. India was preparing for Parliamentary polls.
5. Asian countries like Korea and Japan are reeling under currency crisis.
6. China was nowhere in sight.
7. Infosys was just listed in the exchanges.
8. Big companies successfully recovered from the economic slowdown in 1996-97.
Top 10 companies in 1998:
1. ONGC
2. IOC
3. Reliance Industries
4. GAIL
5. HPCL
6. TELCO
7. BPCL
8. SAIL
9. TISCO
10. Larsen and Toubro.
Source: Business India, 1998 special edition.
Only 2 companies from the 1998 list (Reliance and ONGC) succeeded in making to the 2008 list. So probably 3-4 companies from the 2008 list may make it to the 2018 list. Long term investors should always look to find out those emerging giants. Those investors will only become millionaires by 2018 but not the day traders.
How many investors put their money in IT and Telecom stocks in 1998-2002? How many of us can really think and invest with such a vision? Most of the new age investors have neither vision nor patience. They are just "day dreaming" by particpating in "Day trading". Investors who will invest in next Infosys or Airtel will become millionaires.
Top stocks by market capitalization on July 31st 2008:
1. Reliance Industries
2. ONGC
3. Bharti Airtel
4. NTPC
5. NMDC
6. MMTC
7. Reliance Communications
8. Infosys Technologies
9. SBI
10. DLF
11. BHEL
12. TCS
13. Larsen and Toubro
14. RPL
15. ITC
16. ICICI Bank
25. Sterlite Industries.
28. Suzlon Energy
29. Reliance Capital
42. Reliance Infra
50. GMR Infra.
Top 10 companies in 2018: If you can able to imagine them, you will become another Rakesh Jhunjhunwala.
Top Indian stocks by 2018:
1. Alternative energy stocks like Suzlon or Infrastructure stocks like Reliance Infra or GMR Infra may replace IT stocks.
2. Finance stocks like Reliance Capital are also serious contenders along with stocks like Reliance Power.
3. Metal stocks like Sterlite are dark horses.
4. Public Sector companies may bounce back if disinvestment process will be executed.
5. Reliance Retail which may be listed in 2009 is another strong contender for top 10 slots.
Request: I am requesting users to share their stock picks for 2018.
When will you get exceptional returns?
1. Invest in small caps which have the potential to become mid caps or large caps.
2. Invest in midcaps which have the scope to become large caps.
3. Invest in emerging technologies which generates high margins as they operate in niche areas.
Ex. SPEL Semiconductors, Bartronics, Compact Disc India, Suzlon and Tanla Solutions etc.
4. Invest in turn around sectors like Sugar.
5. Invest in companies which are targets for acquisition like Spice Mobile. But you need patience here.
My recent successes:
1. My stock pick Kavveri Telecom gave 23% returns in just 10 days. Recommended price is Rs 97.5. CMP is Rs 119.
2. My stock recommendation "Rohot Ferro Tech" gave 45% returns in just 17 days. Recommended price is Rs 110. CMP is Rs 161.
3. Another stock pick Jet Airways is also going strong. Recommended price is Rs 439. It is now trading at Rs 501 in just 4 days.
Top Indian stocks by 2018:
1. Alternative energy stocks like Suzlon or Infrastructure stocks like Reliance Infra or GMR Infra may replace IT stocks.
2. Finance stocks like Reliance Capital are also serious contenders along with stocks like Reliance Power.
3. Metal stocks like Sterlite are dark horses.
4. Public Sector companies may bounce back if disinvestment process will be executed.
5. Reliance Retail which may be listed in 2009 is another strong contender for top 10 slots.
Request: I am requesting users to share their stock picks for 2018.
When will you get exceptional returns?
1. Invest in small caps which have the potential to become mid caps or large caps.
2. Invest in midcaps which have the scope to become large caps.
3. Invest in emerging technologies which generates high margins as they operate in niche areas.
Ex. SPEL Semiconductors, Bartronics, Compact Disc India, Suzlon and Tanla Solutions etc.
4. Invest in turn around sectors like Sugar.
5. Invest in companies which are targets for acquisition like Spice Mobile. But you need patience here.
My recent successes:
1. My stock pick Kavveri Telecom gave 23% returns in just 10 days. Recommended price is Rs 97.5. CMP is Rs 119.
2. My stock recommendation "Rohot Ferro Tech" gave 45% returns in just 17 days. Recommended price is Rs 110. CMP is Rs 161.
3. Another stock pick Jet Airways is also going strong. Recommended price is Rs 439. It is now trading at Rs 501 in just 4 days.
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