Here’s the summary of the video, translated into English:
Process to Identify and Analyze Multibagger Stocks
1. Types of Investment
- Value Investing:
- Buying stocks that are undervalued but have a higher intrinsic value.
- These stocks are generally found during market downturns (bear markets).
- Example: Benjamin Graham’s principles.
- Growth Investing:
- Selecting stocks whose fair value is expected to increase significantly over time.
- Example: Phil Fisher’s philosophy.
- Growth at Reasonable Price (GARP):
- Choosing growth stocks at a reasonable price.
- Example: Warren Buffett’s blended approach.
Key Criteria Used for Screeners
1. GARP Screener
- Market Capitalization: Greater than ₹1,000 crore.
- To reduce risks associated with smaller companies.
- Sales: Greater than ₹1,000 crore.
- PEG Ratio: Greater than 0 and less than 2.
- Filters out overvalued stocks despite high growth rates.
- Sales Growth: At least 15% or more in the past 1, 3, and 5 years.
- EPS Growth: At least 15% or more in the past 1, 3, and 5 years.
- Quarter-on-Quarter Growth (YoY): Comparison of the same quarter in the current and previous years.
2. Capacity Expansion Screener
- Gross Block and Capital Work in Progress:
- Current year’s value should be 1.5x or more compared to previous years.
- Indicates that the company is investing in expansion.
- Promoter Holding: 50% or more.
- Ensures that promoters have a vested interest in the company.
- Cash from Investing: Negative cash flow.
- Indicates that the company is investing in growth.
Examples of Mentioned Stocks
- GARP Screener:
- Varun Beverages, CDSL, Adani Ports.
- Capacity Expansion Screener:
- Waaree Energies (Aggressive capacity expansion in the solar sector).
Important Tools and Tips
- Screener Platform:
- Pre-built screeners are available for users.
- Custom columns can be added or edited.
- Create a Watchlist:
- Add selected stocks to a watchlist and study their performance.
- Consider Seasonality:
- Different industries have seasonal sales and profitability trends.
What Should You Do?
- Use Screeners:
- Identify stocks using GARP and Capacity Expansion screeners.
- Research Further:
- Conduct a detailed study of the stocks added to your watchlist.
- Consult a Financial Advisor:
- Seek expert advice before making any final investment decisions.
If you’re interested in a Value Investing screener or any other type of screener, type “Value” in the comments. This video is highly educational for investors and can help improve investment decisions by using screeners effectively.