Hello friends. Very turbulent times are going on in the market right now.
Everyone is predicting the coming recession and market crash.
At this time there is also volatility in the market, especially in the Indian markets where the Nifty 50 is seeing up and down movements of 2-3% on the day.
In times like these, every investor wants a little bit of security.
Defensive stocks provide us with these options.
What are Defensive Stocks? A defensive stock is called a sector stock whose demand is always constant or rising.
These industries play an important role in our daily life. Because of this economic slowdown, do not reduce their demand.
The defensive stock hi was strongest at the start of COVID-19 when the overall market crash happened.
That's why today we will tell you about such top 5 high-growth defensive stocks.
In this video, we will cover all about the business of stocks and also their key strengths and potential risks or weaknesses.
A holistic view of companies to help you in miles.
In addition, we will also look at some of the key financial and technical metrics across companies in a single table.
While selecting the stocks we are in, it has been kept in mind that these companies are fundamentally strong,
so in this list, we will tell you about the stocks whose:
We have considered the closing price of the same as on 19th May 2022 to calculate return.
We will cover the list in ascending order as per 5 Year Sales CAGR i.e. Stock which has the highest growth in 5 Year Sales we will cover it at the end.
So let's start today's list:
The first company on our list is Adani Total Gas.
It is one of India's leading city gas distributors and supplies natural gas to domestic, commercial, industrial, and vehicle users.
It is a joint venture between the Adani Group and French energy giant Total.
The sales of the company have compounded at the rate of 22.82% in the last 5 years.
The company's biggest strength is its strong gas distribution network covering 38 geographies
in Gujarat, Haryana, Karnataka, Tamil Nadu, Rajasthan, Madhya Pradesh, Uttar Pradesh, Chhattisgarh, West Bengal, Bihar, Odisha, and Goa.
The association of the company with Total Energy helps the company to operate in a big way.
The company's breathing big weakness is electric vehicles.
At present, the demand for natural gas is dependent on its potential to substitute petrol and diesel.
But the electrification of the auto sector and the rise of alternative fuels such as ethanol and liquid hydrogen could threaten Adani Total Gas in the future.
Now you can see some key financial and technical ratios of the released company on the screen.
We have included a valuation ratio in the form of price-to-earnings ie P/E ratio.
Return on Equity i.e. ROE as we have done in a Profitability Ratio is included.
Apart from this, we have also included 5 years of sales growth in all the companies so that for the sake of idea lag, how fast the business of these companies is happening.
We have displayed 1-year and 5-year returns to differentiate short to medium-term (1 year) and long-term (5 years) stock performance in the companies
And finally, we have also included the prices of 2 technical indicators so that you can see the stocks from a technical perspective as well.
We have used 2 indicators- 200 days simple moving average i.e. 200 days SMA and RSI (14).
If a company's stock price is trading above the 200 DMA, the stock can be considered bullish.
And if the price is trading down as compared to the 200 DMA then the stock can be said to be bearish.
In terms of RSI, RSI values ​​above 30 are generally considered oversold, and thus a trend reversal ie a downtrend can lead to an uptrend.
Similarly, an RSI value above 70 is considered overbought, and a trend reversal is likely.
The second company on our list is Gujarat State Petronet.
Gujarat State Petronet is a pure-play gas transmission company that primarily transports natural gas through its pipeline.
In addition, the company also sets up cross-country gas pipelines with other major partners such as IOCL, HPCL, and BPCL.
The company's sales have been compounded at the rate of 25% in the last 5 years.
The biggest strength of the company is its strategic location in Gujarat. Gujarat is a major entry point for domestic and imported natural gas from the Arabian Sea.
From here GSPL supplies to the gas markets of Western and Northern India.
In addition, the gas transmission contracts with their customers are quite lengthy, giving them high future revenue visibility.
GSPL owns a 54% stake in Gujarat Gas, the largest gas distributor in Western India.
The interesting thing is that if the 54.17% stake is worth around Rs 20,916 crore while the total market cap of GSPL is around Rs 14,861 crore.
The biggest weakness of the company is the requirement of large Capex for capacity expansion.
Setting up the gas pipeline requires a lot of capital and the cost escalation in these expansion projects could cost the company a lot.
Now you can see some key financial and technical ratios of the released company on the screen.
The third company on our list is Caplin Point Labs.
It is a Fully Integrated Pharma Company which manufactures API, Generic Medicines, Specialty Medicines and Injectables.
They have 4000+ product registrations worldwide with 650+ drug formulations in 36 therapeutic segments.
The company's sales have compounded at the rate of 25.9% in the last 5 years.
The company's greatest strength is its highly diversified product portfolio covering 36 therapy segments and more than 60% of the WHO essential drug list.
The biggest weakness of the company is the high competition in the pharma space.
India is the world leader in generic drug manufacturing, which has a lot of competition in the generic drug segment.
The segment has giants such as Sun Pharma, Dr. Reddy's, and Aurobindo Pharma, whose reach and market position are well ahead of Caplin.
Now you can see some key financial and technical ratios of the released company on the screen.
The fourth company on our list is Indus Towers.
Indus Towers, formerly known as Bharti Infratel, is the largest telecom tower company in India.
This company builds, owns, and maintains Telecom Towers.
The sales of the company have compounded at the rate of 35.4% in the last 5 years.
The biggest strength of the company is that it is the market leader in the telecom tower space.
As of March 2021, Indus Towers has 1.85 lakh towers and 3.35 lakh co-locations in 22 circles.
Is the industry dominant? The establishment of a 5G network in India can get a bigger market share.
A major weakness of Indus Towers, like Gujarat State Petronet Ltd., is the high capital expenditure requirement for the industry.
The telecom tower industry is very capital intensive as companies continue to build new towers in under-patterned areas to expand the coverage area.
For this, the company has to face the working capital issue and can pad further.
As you can see on your screen, we have shown some key financial and technical ratios of the issuing company.
The last company on our list is Zydus Wellness.
Zydus Wellness is a leading FMCG company in India with several leading food and personal care brands
such as Sugar-Free, Complan, Glucon-D, Nutralite, Nysil, and Everything.
The company's sales have compounded at the rate of 36.1% in the last 5 years.
These higher sales growth is possible as Zydus Wellness naquired Heinz India
This added Brand Portfolio Complan, Glucon D, and Nycil and their addressable market and sales profile increased significantly in FY19.
The company's biggest strength is its strong product portfolio with majority of its brands being the market leaders in their respective segments.
The biggest weakness of the company is the limited market size of its top brands like Sugar Free and Glucon-D.
Competition in the personal care segment is increasing with Nykaa and small emerging players such as Wow and Mamaearth's Rise.
Now you can see some key financial and technical ratios of the released company on the screen.
So these were the 5 High Growth Defensive Stocks for You.
Comment and Tell me how many and which defensive stocks are in your portfolio.
Tell us topics on which you want analysis or information.
For today, that's it for this video.