Multibagger Portfolio: The art of choosing hidden gems

Multibagger Portfolio:
The Art of Choosing Hidden Gems

A long-term portfolio of 15 - 20 young companies with the potential to grow exponentially which can create wealth in the medium to long term. The essence is to spot young companies and watch them grow.

Multibagger Portfolio: The art of choosing hidden gems

Synopsis

Young companies with the potential to grow exponentially – hand-picked by StockAxis through its deep research, extensive experience and insights.

Objective

To Recommend young companies which carry potential to grow exponentially and can create wealth in the medium to long term. The essence is to spot young companies and watch them grow.

Stock Selection Process

StockAxis follows 4 key stages while screening potential Multibaggers:

Step 1: Potential Valuation Outliers

Our 'Multibagger' research team uses a number of proprietary screening tools to shortlist stocks from a large universe of companies that meet our parameters and carry the highest possibility of becoming Multibaggers.

Step 2: Fundamental research

The StockAxis ‘Multibagger’ research team then undertakes rigorous fundamental analysis of the shortlisted potential multibaggers. These potential valuation outliers must meet parameters such as earnings growth, profitability parameters, management experience and competence, return on equity benchmarks, competition analysis, etc.

Step 3: Business & Industry Research

The industry, which the company is a part of, should have tailwinds; the company should work on favourable business economics, be a leader in its segment and have niche products. These parameters support a good management to sail through rough business times. We consider all these parameters in our assessment of each company.

Step 4: Stock monitoring and review

Stocks that meet StockAxis’ Multibagger criteria are recommended to our clients. These stocks are actively monitored till the positions are open.

Multibagger Portfolio - Key Traits

Stocks Recommendation
:
Both growth and value stocks where fundamentals are very strong.
Tax efficiency
:
Most capital gains will be long-term.
Regular Rebalancing
:
Stocks with deteriorating factors shall be advised to be sold and / or replaced with stronger positions.
Diversification
:
15 – 20 positions in the portfolio.
Portfolio Churn
:
Low.
Recommended Investment Tenure
:
3 years to get optimum returns.
Value added services
:
  • Access to Research Analysts.
  • Recommendations via SMS, email & mobile app notifications at real-time.
  • Research Reports & Regular Updates.
  • A Dedicated Relationship Manager.
  • Access to the Recommended Portfolio via Web Login and Mobile App.

Multibagger Portfolio Information

Fact Sheet

FAQs

Multi-baggers are budding small caps or mid-caps that have the potential to grow into large-cap stocks thereby rewarding investors with exponential returns. These stocks have the potential to grow at a significantly higher rate than large-cap stocks.

Investing in a potential multi-bagger stock will give you the opportunity to grow your wealth substantially. These stocks represent young companies with a unique product or service with high potential demand from consumers. Once the product or service is established, demand can explode resulting in a steep rise in stock valuation.

Profiting from multi-baggers requires patience and the discipline to stay invested. Returns from such stocks are not linear, i.e. these stocks usually experience high price volatility and on forming a base, the price rise is usually meteoric. In principle, StockAxis Multi-baggers have a holding period of around 2-3 years.

As the name suggests, multi-baggers are stocks which multiply the investment value. StockAxis Multi-baggers offer a potential upside of 80%-100%.

Multi-baggers are risky if you invest without sufficient research and don’t closely monitor these stocks. This is what StockAxis does for you. Potential multi-baggers are picked after in-depth research and analysis and are monitored to assess any potential change in the circumstances of the company or any micro/macro headwinds. Careful selection and ongoing monitoring significantly reduce investment risk in such stocks. Having said that, such stocks experience price volatility which you must be prepared for in order to generate extraordinary wealth from such stocks.

Finding a quality Multibagger involves a rigorous process of extensive and incisive research across the entire spectrum of stocks falling in this category. Every StockAxis Multibagger is picked after considering various factors which include company valuations, the background of promoters & their holdings, corporate governance due diligence, management efficiency, industry trends, economic policies and so on.

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