Atleast 31 companies that have reported a double-digit earnings growth for three quarters in a row saw consistent rise in the foreign institutional holding, data analysed by ETMarkets showed.
Of these 31 companies, shares of atleast 20 of them have given multibagger returns so far in the current financial year.
A majority of the stocks which have seen an increase in FII holding are of domestic-oriented companies, suggesting that the big bulls are betting on the India growth story.
Some of the popular names are Jupiter Wagons, Titagarh Railsystems, Sanghvi Movers, RateGain Travel Technologies, Ramkrishna Forgings, Dixon Technologies, Mrs Bectors Food, Blue Star, Indian Hotels, and Computer Age Management.
Aurionpro Solutions
Foreign investors’ holding in the software major was higher at 6.2% at the end of December quarter, compared to 1.89% at the end of March 2023. The company saw an over 30% YoY growth in both sales and profit in each of the last three quarters. Thanks to the healthy earnings growth, the stock has gained over 600% so far in FY24.
Titagarh Rail Systems
This is another favourite stock of FIIs as they have consistently raised stake for three quarters. From a mere 6% in March 2023, their holding has gone up to 20% in the December quarter. The stock has given a healthy 262% returns so far in FY24, aided by the robust earnings growth of the company.
The company’s profit more than doubled YoY in the June and the September quarter, and grew a sharp 91% in the December quarter.
Brokerage firm Systematix Shares has a “buy” rating on the stock given the strong business prospects, with a price target of Rs 1,258.
“The company’s manufacturing capacity of 8,400 wagons/year, 30,000 mt steel foundry, largest market share in total tenders from FY20-23, presence of factories in India and France, partnerships/consortiums with MNCs, will help in its planned capacity enhancements to capture robust sector demand,” the brokerage said.
RateGain Travel Technologies
In this multibagger stock, foreign institutional holding has doubled in three quarters. They held 8.7% stake as of December end, compared to 4.0% stake in the March quarter. Earnings growth has been robust for the company so far in the current financial year. Profits have risen more than 150% YoY in each of the last three quarters.
With strong Q3 earnings and continuing tailwind of global travel demand, Dolat Capital sees RateGain Travel well-placed to ride the travel boom tide. It has, therefore, maintained an “accumulate” rating with a price target of Rs 900.
Dixon Technologies
The electronics manufacturer has also seen a consistent rise in the holding by FIIs and the stock has given handsome returns of over 122% so far in FY24. Their cumulative holding stood at 17.4% at the end of December, compared to 12% in March 2023.
The company has seen over 40% YoY growth in profits in each of the last three quarters. In the December quarter, revenue doubled on year.
Dixon has aggressively increased its capacity in the mobile segment which is substantially increasing the company’s revenue visibility, though at the cost of margin erosion. It anticipates a shift towards local manufacturing, which could be a key driver, contributing to the company’s growth, Axis Securities said. The brokerage has a “hold” rating on the stock.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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