High-priced stocks: Dont turn blind eye to them as 10 stocks turn multi-bagger in just 6 months

Most of the market participants have been afraid of investing in ‘high priced’ stocks. A predefined notion is engraved in their mind that high-priced stocks are always expensive and are not at all a bargain investment deal. 

The calendar year 2021 has been a joyful one for the markets as it is up by 13.3 per cent on a YTD basis. More importantly, two out of six months, which we have seen in the calendar year 2021 has been a trending one as Nifty delivered gains in excess of 6 per cent. In the month of February 2021, Nifty jumped 6.56 per cent while in May, it soared 6.5 per cent. If this is not enough, what is more striking about the current rally is that it is broad-based.   

As the key benchmark continues its latest uptrend, we take a deep dive into the performance of one of the sections of the stock market, which investors, especially retail investors, turn a blind eye to. This section is of high-priced stocks, we have taken into account the stock which is trading in four digits as a high-priced stock.  

Most of the market participants have been afraid of investing in ‘high priced’ stocks. A predefined notion is engraved in their mind that high-priced stocks are always expensive and are not at all a bargain investment deal. However, they fail to understand that high-priced stocks are not always the same as expensive ones. A stock’s price and value aren’t the same. What’s more important is to look at the stock’s value and this value helps us to decide whether it's cheap or expensive. Fundamentally, one of the most popular methods for finding a stock’s value is the price-to-earnings (P/E) ratio.    

Now, let us look at how the ‘high-priced’ stocks have performed on a YTD basis:  

There are 142 stocks, which have delivered positive returns on a YTD basis whereas, only 20 stocks delivered a negative return during the same period.   

Interestingly, out of 142 stocks, which have delivered a positive return on a YTD basis, 10 stocks have been multi-bagger as their price surged in excess of 100 per cent. The list includes: Adani Enterprises, Adani Transmission, Alkyl Amines Chemicals, Adani Total Gas, Balaji Amines, Britannia, Eclerx Services, HEG, Lux Industries and Tata Elxsi. Interestingly, Adani Enterprises and Adani Total Gas have delivered gains of 216 per cent on a YTD basis.