These are the five fastest-growing Indian stocks (2024)

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These are the five fastest-growing Indian stocks (14) Markets

Equitymaster 7 min read 19 Jun 2024, 02:28 PM IST

These are the five fastest-growing Indian stocks (15)

Summary

  • High-growth companies can be attractive investments as their stock prices can shoot up quickly. However, its best to treat them with caution as their stocks can be extremely volatile during uncertain times.

Investors are always looking for stocks with exceptional growth potential, particularly those capable of accelerating revenue growth and profitability.

When evaluating growth stocks, key factors to look for include robust revenue expansion, strong profit growth, impressive return ratios, and consistent dividends. This article highlights five rapidly growing stocks that exemplify these traits and offer promising opportunities across various sectors.

LTIMindtree

Larsen & Toubro Infotech and Mindtree merged in 2022 to become India's sixth-largest IT services company. It primarily offers IT services such as application development, maintenance, outsourcing, enterprise solutions, infrastructure management, and digital solutions.

Its principal business verticals are banking, finance and insurance, manufacturing, media, retail, travel, hospitality, and healthcare. The company has more than 700 clients across 30 countries.

In the past five years, sales have grown at a compound annual growth rate (CAGR) of 26.7%, driven by healthy deal wins, improved cross-selling and up-selling opportunities, and an increased ability to bid for large deals.

Earnings before interest, tax, depreciation, and amortisation (Ebitda) and net profit grew at a CAGR of 25.8% and 24.7%, respectively, due to high employee utilisation and client additions. Although profit margins fell slightly owing to merger-related integration costs, return on capital employed (RoCE) and return on equity (RoE) averaged 27% and 37%, respectively.

The company also has zero debt and pays large dividends to shareholders. Over the past five years, the dividend payout and dividend yield averaged 35% and 1.3%, respectively.

These are the five fastest-growing Indian stocks (16)

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Currently, the company is focused on cross-selling and up-selling opportunities to win new deals and acquire more clients. It is also looking at improving profit margins by reducing discretionary spending and tail rationalisation – focusing on the most profitable projects and eliminating the least profitable ones.

It these efforts are successful, investors can expect strong revenue and profit growth.

Varun Beverages

One of the largest franchisees of PepsiCo worldwide, the company produces and distributes a wide range of carbonated and non-carbonated drinks and packaged water. It sells popular brands such as Pepsi, Seven-Up, Mirinda, Mountain Dew and Tropicana.

The company has 43 manufacturing facilities in India and abroad, and a robust distribution network of more than 110 owned depots, 2,500 owned vehicles, 2,400 primary distributors, and 925,000 visi coolers.

Its robust distribution network has given it a unique advantage, helping it become the market leader and grow its sales at a CAGR of 17.6% over the past five years.

Varun Beverages also has large facilities with backward integration for producing crowns, plastic closures, corrugated boxes and shrink-wrap film. This has helped it cut costs and grow Ebitda and net profit at a CAGR of 19.9% and 34.8%, respectively.

Profit margins have also expanded over the past few years due to operational efficiencies. The five-year average Ebitda and net profit stand at 20.6% and 9.2%, respectively. RoE and RoCE have also expanded consistently, with the five-year average at 20.7% and 22.6%, respectively.

Although not a huge dividend payer, the company pays regular dividends to its shareholders. In the past five years, the dividend payout and dividend yield averaged 9.6% and 0.2%, respectively.

These are the five fastest-growing Indian stocks (17)

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As one of the largest franchisees of PepsiCo, the company has worked on improving its network and expanding its production facilities. In December 2023, it laid the foundation for its 44th manufacturing facility with a capital expenditure of 2.7 billion, and also plans to set up three new manufacturing facilities in Maharashtra, Jharkhand, and Odisha. It has also acquired franchisee rights in South Africa as part of its international expansion.

Going forward, both revenue and profitability are expected to grow in the medium term.

Titan

Titan, part of the Tata Group, is one of India's most respected lifestyle companies. Its established products include watches, eyewear and jewellery, and it recently expanded into fragrances, bags and apparel.

The company owns several popular brands such as Skinn, Fastrack, Titan Eye+, Tanishq, and Sonata. It is the world's fifth-largest watch manufacturer and accounts for more than 6% of India's jewellery market.

Titan has an extensive network of outlets across product categories, including 898 jewellery outlets, 1,080 exclusive and 8,000 multi-brand watch outlets, and 975 eye-wear outlets. It also has a presence in more than 200 large stores for its emerging businesses. It operates in more than 40 countries.

Strong distribution networks in India and abroad have helped the company clock impressive sales growth of 15.5% (CAGR) in the past five years. Ebitda and net profit grew at a CAGR of 19.5% and 18.7%, respectively, over this period. Profit margins also expanded due to operating leverage and a growing share of high-margin jewellery and watches. As a result, RoE and RoCE also expanded, averaging 21.9% and 32.2%, respectively, in the past five years.

Titan is also known for consistently paying dividends to its shareholders, with a five-year average dividend payout and dividend yield of 29.9% and 0.4%, respectively.

These are the five fastest-growing Indian stocks (18)

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It is also investing in expanding in India and abroad. In the next few years, it aims to expand Tanishq’s presence from 265 towns to 300 towns. It also plans to expand its emerging businesses rapidly to capture the growing demand for apparel. The company’s strong growth plans will drive its revenue and profit growth in the medium term.

Polycab India

India's leading manufacturer of cables and wires, Polycab has a large portfolio of cables, wires and allied products such as PVC conduits, lugs and glands. It recently entered consumer electrical product segments such as fans, switches, switchgear, LED lights, luminaries, solar inverters and pumps.

The company has a 24% market share in the domestic organised wires and cables sector and is present in more than 76 countries. It has 25 manufacturing facilities, and a network of over 4,300 distributors, 200,000 retail outlets, 23 warehouses, four regional offices, nine local offices, and 17 experience centres in India.

Sales grew at a CAGR of 12.1% in the past five years due to a growing share of the organised cables and wires sector and a large contribution from the consumer electricals business.

Ebitda and net profit grew at a CAGR of 14.1% and 20.7%, respectively, due to the company's ability to pass on increased raw-material costs to its customers. Profit margins thus expanded as well, averaging 12.1% and 8.1%, respectively. RoE and RoCE averaged 18.1% and 25.4% over the past five years.

Polycab India has also consistently increased its dividend payout. The dividend payout and dividend yield averaged 17.6% and 0.7%, respectively, in the past five years.

These are the five fastest-growing Indian stocks (19)

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The company has ambitious growth plans and aims to spend 7 billion on capex in each of the next two years.

Three-fourths of this capex will go to the cables and wire business to set up a high-voltage manufacturing plant, and the rest will be allocated to the consumer electricals business for maintenance and removing bottlenecks. It plans to fund the entire capex through internal accruals, indicating that it has adequate liquidity.

The company's expansion plans could further fuel its growth and boost revenue and profits in the medium term.

Bharat Electronics

Formed under the ministry of defence, Bharat Electronics is a multi-product, multi-technology conglomerate that provides products and systems to the defence sector.

It has a large product portfolio that includes radars, fire control systems, missile systems, communication systems, tank electronics, and gun upgrades. It recently began producing supplying weapons systems and lithium-ion batteries. It is also undertaking solar power plant projects and has partnered with ISRO for satellite assembly, integration and testing.

It has also secured business from the Security Analytics Center (SAC), and is working on data-diode solutions for DRDO. It also provides an automatic fare collection system for railway and metro projects.

In the defence sector, it works on requirements for drone payloads, data linkages, and ground control stations. It also provides drone guard systems and is developing RF and IR seekers, missiles, and arms and ammunition.

In the past five years, the company’s revenue has grown at a CAGR of 7.8% on account of a large order book. Ebitda and net profit grew at a CAGR of 7.6% and 9.7%, respectively, due to high order execution. Ebitda margin and net margin averaged 21.8% and 15.1%, respectively in the past five years. RoE and RoCE expanded as well, averaging 19.4% and 26.9%, respectively.

Bharat Electronics is also a large dividend payer. Its dividend payout ratio and dividend yield averaged 44.3% and 2.9%, respectively, in the past five years.

These are the five fastest-growing Indian stocks (20)

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While the company is already on its growth path, it has secured several orders from prestigious clients, including the Indian Army. It has also signed contracts to jointly develop long-range, dual-band, infrared search-and-track systems, and a chip factory.

All of this should boost the company’s revenue and net profit in the medium term.

Should you invest in high-growth companies?

High-growth companies are often market leaders in their industries. They can be attractive investments as their stock prices can shoot up quickly. However, the success of these companies depends heavily on prevailing economic conditions, and their stocks can be extremely volatile during uncertain times.

It’s best to treat growth stocks with caution, like any other stock, and consider them only for long-term investment.

Happy investing!

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.

This article is syndicated from Equitymaster.com

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These are the five fastest-growing Indian stocks (2024)

FAQs

These are the five fastest-growing Indian stocks? ›

Which industry is growing fastest in India? In 2024, the fintech sector is among the fastest-growing industries in India. This growth is driven by increasing digital transactions and innovations like UPI and digital currencies.

Which is the fastest growing stock in India? ›

FAST GROWING STOCK
S.No.NameROCE %
1.Bajaj Holdings13.07
2.Lloyds Metals78.27
3.Mahanagar Gas36.60
4.Zee Entertainmen6.62
22 more rows

What are the top 5 stocks to invest in India? ›

best long term stocks
S.No.NameCMP Rs.
1.Ksolves India1025.10
2.Nestle India2526.85
3.Tips Industries696.80
4.Waaree Renewab.1422.05
22 more rows

Which Indian stock gives the highest return? ›

More Collections >
Name3Y ReturnNet Profit Qtr
Reliance Industries Ltd32.2%₹17,448 Cr
Tata Consultancy Services Ltd16.79%₹12,105 Cr
Bharti Airtel Ltd133.86%₹4,718 Cr
ICICI Bank Ltd68.52%₹11,696 Cr
8 more rows

What are the top five growth stocks? ›

10 Best Growth Stocks to Buy for 2024
StockImplied upside*
Mastercard Inc. (MA)19.4%
Netflix Inc. (NFLX)5.2%
T-Mobile US Inc. (TMUS)6.9%
Wells Fargo & Co. (WFC)21.5%
6 more rows
Aug 23, 2024

Which sector is growing fast in India in 2024? ›

Which industry is growing fastest in India? In 2024, the fintech sector is among the fastest-growing industries in India. This growth is driven by increasing digital transactions and innovations like UPI and digital currencies.

Which stock is best for next 10 years in India? ›

Best Long Term Investment Shares: An Overview
  • Hindustan Unilever Ltd. ...
  • Bajaj Auto Ltd. ...
  • Bharat Electronics Ltd. ...
  • Zydus Lifesciences Ltd. ...
  • HCL Technologies Ltd. ...
  • LTIMindtree Ltd. ...
  • Pidilite Industries Ltd. ...
  • Sun Pharmaceutical Industries Ltd.
Sep 3, 2024

Who is No 1 in Indian stock market? ›

Reliance Industr

Which stock will boom in India? ›

Top Trending Growth Stocks in India
  • JK Paper Ltd. ...
  • Allcargo Logistics Ltd. ...
  • Oil India Ltd. ...
  • Caplin Point Laboratories Ltd. ...
  • Godawari Power and Ispat Ltd. ...
  • Marksans Pharma Ltd. ...
  • Chambal Fertilisers and Chemicals Ltd. ...
  • Indraprastha Gas Ltd.
Aug 9, 2024

Who is the No 1 stock investor in India? ›

Rakesh Jhunjhunwala

Nicknamed “India's Warren Buffet” and “The Big Bull,” Rakesh Jhunjhunwala, a prominent figure in the Indian stock market with total assets valued at $2.4 billion has earned quite a reputation through his investment strategies and insights into the markets.

Which stock can give 1000 returns in India? ›

1000% Return
S.No.NameSales Qtr Rs.Cr.
1.Nestle India4813.95
2.Lloyds Metals2417.24
3.Esab India329.61
4.Shilchar Tech.106.99
22 more rows

Which is the No 1 expensive share in India? ›

MRF Ltd. Established in 1946, MRF Ltd is India's largest tyre manufacturer. MRF is India's most expensive share. The company's production plants are present in Trichy, Tiruvottiyur, and Arakonam in Tamil Nadu, Kottayam in Kerala, Ponda in Goa, Medak in Andhra Pradesh, and Pondicherry Union Territory locations.

Which stock will boom in 2025 in India? ›

10 stock ideas to hold until Union Budget 2025 from Chola...
  • IANS. 1/11. Stock Ideas. ...
  • ETMarkets.com. 2/11. ​RVNL. ...
  • ETMarkets.com. 3/11. ​Ircon International. ...
  • ETMarkets.com. 4/11. ​HAL. ...
  • ETMarkets.com. 5/11. DCX Systems. ...
  • ETMarkets.com. 6/11. ​General Insurance Corporation of India. ...
  • Agencies. 7/11. LIC. ...
  • ETMarkets.com. 8/11.
Jun 9, 2024

Which stock will boom in 2024 in India? ›

Best stocks in 2024
S.No.NameCMP Rs.
1.Man Infra191.01
2.BLS Internat.435.15
3.Black Box511.95
4.RHI Magnesita574.60
22 more rows

What are 5 good stocks? ›

Top Long-Term Stocks in India for 2024 as per market capitalisation
CompanyIndustry
Tata Consultancy ServicesIT Services
Hindustan UnileverConsumer Goods
InfosysIT Services
HDFC BankBanking
6 more rows

Which stock will double in 6 months? ›

6 months double
S.No.NameCMP Rs.
1.Sri Adhik. Bros.690.95
2.Ujaas Energy544.25
3.Eraaya Lifespace1543.05
4.Marsons211.65
22 more rows

What stock is rising the fastest? ›

Stocks
SymbolPriceChange %
CDE Coeur Mining, Inc.6.85 +1.10 (+19.13%)+19.13%
MPW Medical Properties Trust, Inc.5.60 +0.78 (+16.18%)+16.18%
SIG Signet Jewelers Limited86.94 +8.85 (+11.33%)+11.33%
WBD Warner Bros. Discovery, Inc.7.66 +0.72 (+10.37%)+10.37%
21 more rows

Which is the most profitable stock in India? ›

High Profit stocks
S.No.NameMar Cap Rs.Cr.
1.Starlite Comp.6.22
2.Quantum Digital6.13
3.Modern Dairies128.49
4.Monind9.44
22 more rows

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