How do you identify multi bagger stocks in India ?

Dear Investors and Traders,

When it comes to finding the multi-bagger stock first question that arises in the investor's mind is that is the business of the company and no doubt in this innovative world identifying the multi-bagger business is not remain a daunting task for young investors.

Here I would like to share some factors and key things which are to be noted while identifying the multi-bagger companies.

1. Defensive Stocks/ Non- Cyclical Stocks- 

Try to identify the businesses which are not cyclical means they don’t follow the trend of the overall economy or any other factor of the economy.

2. Search for a strong moat in the business- 

While investing we should consider the business not the stocks because we are not buying stocks actually we are buying a portion of the business, therefore, try to find such businesses which have a strong moat in the industry which can lead in the industry. For example- IRCTC, IEX, CAMS, CDSL, DEEPAK NITRITE, BSE.

3. Strive to Seek knowledge about identifying the financials of the company-

 Undoubtedly, behind each and every company, financials are the backbone of the company. Without having a strong financial background company can’t be able to pursue the business. Try to read the balance sheet and cash flow statement. Such accounting statements would help recognize the financial past performances of the company and further predictions can be taken into consideration.

4. Competitive strength - 

In this world, competition plays a vital role, only unique businesses can generate huge profit in the competition. Finding the competitive advantage of the company will help in the future to generate higher returns compared to the peer groups.

5. Consistent compounder- 

Companies that are generating consistent revenue and profits and beating the margins of peer group and increment in the profits on the basis of year on year can be the simple and best example of the multi-bagger business.

6. Strong Management and their past performance- 

Watch the interviews and conference calls of the companies and get the information and commitments given by their management. Try to track the continuous performance of the company under different management.

Thank You & Good Day