The 23 per cent fall in the Sensex since its peak in January has brought an entire galaxy of stocks to the ground. The good part is that it gives an opportunity to those who got left out of the bull run to enter the market at, what look like bargain-basement prices that are much closer to their values.
The market has dragged down not just momentum stocks, but many fundamentally strong ones also. One way to spot the stocks going for a song is to look at their fundamental figures.
We have looked at companies with a market cap of Rs 1,000 crore (Rs 10 billion) or more with a price-to-earnings (PE) ratio of not more than 15, a price-to-book value less than three, and net profit growth of over 20 per cent consistently in last four quarters.
Qualitative filters were also used to remove sectors that look shaky today. This left us with five stocks that look good. But with the market so volatile, look at the long-term with stocks and not at appreciation in the next three weeks. Read on. . .
Text: Rajesh Kumar, Outlook Money
Image: The Bombay Stock Exchange building in Mumbai. Sajjad Hussain/AFP/Getty Images
Also read: An amazing story: From Rs 60,000 to Rs 435 cr!
Advertisement
