Hey, friends, today we have brought a new series whose name is Report card. A report card is a parameter to determine the best performers in stocks and mutual funds.
This is the first video of this series where we will discuss 5 companies that gave the best returns to their investors from 1 January 2020 to 1 December 2020. These 5 companies will be chosen from the Nifty50 index.
In the coming time, we will bring more such report cards with monthly reports, quarterly reports, best performing mutual funds, and quarterly results. We hope that you don't miss any information as an investor.
Firstly I would like to tell you that if you have still not subscribed to Groww's channel, then surely do it to not miss any report card video.
I, Jagdeep Singh, welcome you to the Groww youtube channel. Without taking much time, let's start today's video and talk about the first company that gave great returns to its investors from 1 January to 1 December.
So friends, the first company of our report card is the Divis lab under the pharmaceutical sector. You might know that the pharmaceutical sector acted as a defensive sector under the covid situation.
There were a lot of companies from the pharmaceuticals sector that gave good returns to their investors. In today's report card, Divis lab has given the best performance in the chosen timeframe.
The Divis lab's share on 1 January 2020 was around Rs.1818, while yesterday's closing price(Wednesday) was above Rs.3600.
From here, you would have understood that this company is on our top list as it has given more than 100% return to its investors.
It means if you would have invested Rs.100, then today that would be equivalent to Rs.200. So this company is number 1 on our report card.
It is normally said that only those companies perform well whose business also does well. The business performance of Divis Lab has shown growth in quarter on quarter results, the company's profit, and margin.
When there is fundamental growth in a company, then its share price automatically surges. The debt level of Divis Lab depicts that it is almost a debt-free company, which can be a positive thing for it.
Now let's talk of our report card's second company, which has given the best return after Divis Lab. An interesting fact is that the second company is also from the pharmaceutical sector.
If you have not guessed its name by now, let me tell you its name is Dr. Reddy's lab. In the past year, this company has given more than 68% return to its investors.
Dr. Reddy's share on 1 January 2020 was around Rs.2868, while currently, it is trading for more than Rs.4800.
From here, you must have understood the high performance delivered to investors by the second company of our report card-Dr Reddy's. In percentage terms, this company has given a 68% return to its investors.
It has also performed well even in financial terms when the performance of most companies fell in covid. Also, since then, its quarterly performance has been remarkable.
Its revenue has improved, and its operating profit margin has been constant. However, in the September quarter, the company's net profit fell slightly compared to the same quarter in the last financial year.
The debt level of the company is nominal, which can be a safe thing for it.
Now let's talk about the third company of our Report card. You would be surprised to know that the third company is from the IT sector. The IT sector has also acted as a defensive sector, just like the pharmaceutical sector under the covid situation.
The maximum companies in the IT sector have given great returns in the past few months.
But the interesting thing is that this sector the second-largest company of this sector- Infosys ranks third in our list for giving high returns to its investors from 1 January 2020 to 1 December 2020.
Infosys's share on 1 January 2020 was above Rs700, while currently, it is trading for more than Rs.1100.
Infosys is the third company on our report card, which has given an almost 55% return to its investors. Till now we talked about 3 companies of the report card.
The first one is Divis lab, which gave 100% returns to its investors. The second number is held by Dr. Reddy's lab, with a 68% return. While the third company of the report card is Infosys, which gave an almost 55% return to its investors.
Talking about the business, Infosys falls under the IT sector and is the second-largest IT company in India after TCS. Its P/E ratio is 25, which is comparable to the IT sector.
In the past, the business of the IT sector has improved. The company has delivered a great performance to its investors in the quarterly profits and revenues.0
The company's business has been robust and growing in recent times, which has impacted its share price.
From here, you can infer that you don't make an investment in share but in a company's business. These three companies in our report card have great share prices due to the improvement in their businesses.
So you might have understood that choosing a great business gives a share price automatically as it expands and improves its profit, operating profit margin, etc.
Hence, we learned that one should not be afraid of volatility but should make an investment in a great business. Without taking much time, let's move to the fourth company on our list, which gave a great return to its investors.
Let's talk about the next company of our report card (top 5) in terms of performance if we make a comparison from 1 January to 1 December. Cipla has also given more than 55 % return to its investors during this time.
Due to a 55% return, its share price is currently trading for more than Rs.750. Hence this company comes in the top five companies of our report card with high returns to investors in the calendar year 2020.
The P/E ratio of Cipla is around 33. Compared to the best return performer- Divis lab (P/E ratio -55) and other top-rated Nifty50 companies, its P/E ratio is low.
Besides this, in the recent quarterly results (September quarter) Cipla showed a great performance with remarkable numbers.
The numbers of September quarter of last FY shows that the total revenue was around Rs.4300 crores which has currently reached Rs.5000 crores.
Cipla's operating profit margin was 21% in the same quarter of last FY, which has improved and reached 23%. The net profit of the company has risen from Rs.470 crores to Rs.650 crores.
From here, you can understand that Cipla has performed well in previous quarters, which has impacted its share price.
Now let's talk about the fifth company of our report card, whose name is HCL technologies. This company comes from the IT sector.
HCL's share on 1 January 2020 was around Rs.571, while currently, it is trading for more than Rs.840.
It has shown a great performance by giving 56-57% return to its investors in the chosen time frame.
So you might have understood that the five companies chosen by us were from Nifty 50, and slight variations in delta might be there. But our main motive was to give you insightful information through this series.
In today's report card, we saw the name of five companies. Let me again tell you about these five companies if you missed them.
The five companies on which we did a detailed discussion in today's report card are Divis lab, Dr. Reddy's Lab, Infosys, Cipla, and HCL.
These are the 5 companies that gave the best returns to their investors from the time frame of 1 January to 2-3 December.
This was just a discussion. Disclaimer- We don't give any recommendation to buy/sell any stock in our videos. We make videos only for educational purposes.
You can subscribe to our channel as we will bring such report cards in the near future where we will share information on a monthly or quarterly level for you as an investor.
If you liked today's video, then press the like button. Comment below your favorite company out of these 5 companies where you have invested or are willing to invest.
Also, share the reasons for the same so that our viewers can learn from your comments. Happy investing!