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Hopeless cases! These stocks need up to 3,000% rise to hit 52-week highs

If these stocks are to touch new record highs, they would need a rally of 1,50,000 per cent!

Updated: Nov 20, 2019, 11.24 AM IST
NEW DELHI: At least 58 stocks from the BSE500 basket need to surge anywhere between 100 per cent and 3,000 per cent if they were to revisit their 52-week highs.

If the same set of stocks are to touch new record highs, they would need a near-impossible rally of up to 1,50,000 per cent!

Most institutional investors have already given up on many of these names, but retail investors are piling up these names, hoping for multibagger returns.

Among these names is Reliance Communications, which traded at Re 0.56 apiece on Wednesday and requires a 3,052 per cent rally to reclaim its 52-week high of Rs 18.60. For this stock to hit its January 2008 record high of Rs 844, it needs to rally 1,42,950 per cent!

Individual investors, with less than Rs 2 lakh exposure to a stock, owned 33.80 per cent of this company as of September 30. HNIs, who own shares worth more than Rs 2 lakh in a company, account for another 24.22 per cent holding.

Other ADAG stocks, Reliance Capital, Reliance Infrastructure and Reliance Power need to rise between 780 per cent and 1100 per cent to revisit their one-year high levels.

At Rs 21, DHFL shares need a 987 per cent surge to hit their 52-week high of Rs 252.90 hit on December 31, 2018. Small investors held 31.69 per cent stake in this housing finance company as of September 31. HNIs owned 4.62 per cent in this Wadhawan Group company.

Coffee Day Enterprises needs nearly 600 per cent jump to reach its 52-week high of Rs 317 it hit in March this year. The stock traded at Rs 53 on Wednesday. Individual holding on this counter stood at 16 per cent. PC Jewelller, Jain Irrigation, Lakshmi Vilas Bank, Evergreen Industries and HEG need to rise between 320 per cent and 420 per cent, while others such as Indiabulls Housing Finance, SREI Infra, YES Bank and Tejas Network have to rally over 300 per cent to reclaim their respective 52-week highs.

“We have seen a lot of pain where companies have had high leverage or where there were promoter concerns. One would still stay away from those names as because of the mishaps and correction, the risk in midcaps and smallcaps still remains high. We are not seeing a broadbased rally at least in the near term,” said Mahesh Patil, Co-CIO, Aditya Birla Sun Life AMC

Gurmeet Chadha of Complete Circle Consultants believes investors should go where there is earnings visibility. “I am not a great believer that one should start picking up beaten-down names because the divergence will take some time. One has to tread with caution on all those theories of quality being very expensive, and selling quality and getting into the cheaper names. You should go where the earnings visibility is," Chadha told ETNOW.

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