Best stocks to buy in India in 2013 for long term investment

Best stocks to buy in India in 2013 for long term investment

Best stocks to buy in India in 2013 for long term investment

Investment in the stock markets has provided annualized returns of 19% in the last 10 years. The returns from the stock market beat all other investment options. Earlier we have detailed about how to do stock research in identifying the best stocks. In this article we have identified some of the best stocks to buy in India for long term investment from large cap sector.

Best stocks to buy in India in 2013 for long term investment

  1. ICICI Bank: ICICI Bank is the largest private sector bank comparing to its asset base. The loans are expected to grow at approx 20% for FY 13. ICICI Bank capital adequacy ratio is around 18% to 19% which provides good opportunity to ramp-up its business. Currently it is trading at Rs 1122. This is one of the best stocks to buy in India for long term objective.

         Why you should buy ICICI Bank?

  • Consistent good performer in the last 5 years
  • Revenues have grown by 29% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 29% (YoY) in FY12.
  • Profits have grown by 30% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 25% (YoY) in FY12.
  • EPS is growing year on year Rs 37 in 2008 vs Rs 56 in 2012.
  • Top mutual funds holding highest share in their portfolio
  • UTI Dividend Yield Fund       8%
  • HDFC Growth Fund              8%
  • ICICI Pru Infrastructure        8%
  • SBI Magnum Contra Fund     8%
  • SBI Magnum Multiplier Plus  8%
  • HDFC Equity Fund               8%
  • DSP-BR India TIGER – RP      7%
  • HDFC Top 200 Fund             7%
  1. Tata Consultancy Services (TCS): TCS is the one of the largest and oldest IT Company in India. Currently TCS have 1000+ active clients and 2.4 lacs of employees. TCS is outperforming Infosys and Wipro in terms of growth. Currently it is trading at Rs 1258.

       Why you should buy TCS?

  • This is one of the good stocks to buy in India for 5 to 10 years investment objective.
  • The revenues for the last year FY12 has crossed $ 10 Bn.
  • Revenues have grown by 27% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 32% (YoY) in FY12.
  • The revenue growth for FY13 and FY14 is expected at 14-15%.
  • Profits have grown by 17% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 44% (YoY) in FY12.
  • EPS is growing year on year Rs 46 for FY2008 vs Rs 56 in FY2012.
  • TCS has multiple margin levers where it is able to absorb the salary increases year on year.
  • Top mutual funds holding highest share in their portfolio
  • Axis Equity Fund                    5%
  • Axis Focused 25 Fund             5%
  • HDFC Long Term Advantage   5%
  • Quantum Long-Term Equity    5%
  • IDFC Classic Equity – A            5%
  • IDFC Imperial Equity – A          5%
  • L&T India Large Cap Fund       5%
  • SBI Magnum Multiplier Plus     4%
  • UTI Long Term Advantage       4%
  • HDFC Core & Satellite Fund    4%
  1. State Bank of India: SBI is the largest bank in India. SBI has been consistent performer year on year with its large base of customers. Currently it is trading at Rs 2,333. This is among the good stocks to buy in India in banking sector.

         Why you should buy SBI?

  • Revenues have grown by 14% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 30% (YoY) in FY12.
  • The revenue growth for FY13 and FY14 is expected at 14-15%.
  • Profits have grown by 30% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 41% (YoY) in FY12.
  • EPS is growing year on year Rs 106 for FY2008 vs Rs 174 in FY2012.
  • Estimated EPS for FY13 is Rs 214 and FY14 is Rs 248 which indicates that profits would grow in future.
  • Top mutual funds holding highest share in their portfolio
  • HDFC Equity Fund               9%
  • HDFC Infrastructure Fund    9%
  • SBI PSU Fund                      9%
  • HDFC Long Term Equity Fund 9%
  • Reliance Vision Fund – RP    9%
  • HDFC Top 200 Fund            9%
  • Axis Focused 25 Fund         9%
  • Sundaram Fin-Serv. Opp     9%
  • Reliance Banking Fund       7%
  • Reliance Quant Plus – RP    7%
  1. Infosys: Infosys is the 2nd largest IT Company in India. The revenues has crossed 7 Bn. Current market price is Rs 2,292.

        Why you should buy Infosys?

  • Revenues have grown by 22% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 23% (YoY) in FY12.
  • Profits have grown by 28% (QoQ i.e. last year same quarter vs current year quarter) in Q2FY13 and 31% (YoY) in FY12.
  • EPS is growing year on year Rs 78 for FY2008 vs Rs 145 in FY2012.
  • Estimated EPS for FY13 is Rs 164 and FY14 is Rs 176 which indicates that profits would grow in future.
  • Top mutual funds holding highest share in their portfolio
  • Reliance Quant Plus – RP 11%
  • ICICI Pru Services Indus.  10%
  • Tata Equity Opp. Fund    9%
  • HDFC Long Term Equity   9%
  • UTI Services Industries    8%
  • HDFC Growth Fund         8%
  • IDFC Imperial Equity       8%
  • Kotak 50                        8%
  • ICICI Pru Target Returns 8%
  1. ITC: ITC is one of the consistent performers in the FMCG sector. Current market price is Rs 288.

        Why you should buy ITC?

  • This is one of the best stocks to buy in India in FMCG sector as it performs well even in the bear market.
  • Revenues have grown by 18% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 17% (YoY) in FY12.
  • Revenues are growing at an annualized growth rate of 18% in the last 5 years
  • Profits have grown by 21% (QoQ i.e. last year same quarter vs current year quarter) in Q2-FY13 and 23% (YoY) in FY12.
  • EPS is stable at Rs 8 in the last 5 years.
  • Top mutual funds holding highest share holdings in their portfolio
  • IDFC Equity Fund                    8%
  • L&T India Large Cap Fund       8%
  • UTI Equity Tax Saving             8%
  • Morgan Stanley Growth           8%
  • UTI Top 100 Fund                   7%
  • L&T Equity Fund                     7%
  • SBI Magnum Equity Fund         7%
  • UTI Contra Fund                     7%
  • ICICI Pru Top 200 Fund            7%
  • IDFC Classic Equity                 7%

Conclusion: The above best stocks to buy in India are for long term investment objective. Since the market is in the peak level now, any correction in these stock prices, investors can grab the opportunity of buying them for long term. Ultimately the goal is to invest in best investment options and multiply the money.

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Suresh
Best stocks to buy in India in 2013 for long term investment

Article by Suresh

Suresh KP i.e. me have written 500+ articles on this blog. I love doing analysis and identifying the Best investment options.

108 Comments

  1. Vikas says:

    Hello Sir,
    I have shorlisted following companies for investment.
    Asian paints,
    ceat tyres,
    yes bank,
    marico,
    finolex industries,
    pi industries,
    havells,
    rane Asian paints, ceat tyres, yes bank, marico, finolex industries, pi industries, havells, rane holdings, hatsan agro, godrej consumers. Mi ya companies short list kelyat. ,
    hatsan agro,
    godrej consumers.
    Sir I want ur suggestion regarding these companies.

  2. shekhar chopra says:

    hi sir
    can you sugesst best share to buy this financial year ..i am a invester not trader so please suggest me some best share to buy this financial year..i am a beginer and a small invester so plz suggest according to that..right now i have bought tita comapny ltd.ashok leyland,gujarat state fertlizer and chemical ,century plyboard and rain industries company shares aroun 10 each of comapny shares .please suggest about these comapny shares and another best to buy.
    thanks and regards
    shekhar

  3. Amit Teli says:

    Hi Suresh,

    I would like to know if I invest in MF or Shares, would I receive returns on quarterly basis?

    I have opened trading and demat account from HDFC securities and HDFC bank for MF.

    Can you also advise me on which MF to go with HDFC and shares?

    I am not into SIP.

    I would also like to know about MF's which are directly controlled by MF managers and shares also…

    I am looking forward to invest very little amount of money for now, may be 1 – 2.5k/month or so.

     

    Regards,

    Amit Teli

    • Suresh KP says:

      Amit, Generaly investments into mutual funds or shares done to create wealth and not monthly or quarterly returns. However you may get dividend from shares which is not guaranteed. Similarly MIP Mutual funds would provide your regular returns, but not guaranteed. Hence treat them as growth purpose only. You can invest in large cap mutual funds like ICICI Pru focussed blue chip fund or Birla SL Frontline fund or Franklin India Blue chip fund etc. All mutual funds are controlled by respective MF Managers only. However you can invest directly by visiting their website or invest thru brokers like HDFC securities. You can invest as low as Rs 500 per scheme. Some kept a limit of Rs 1,000 in SIP. 

  4. Krishna says:

    Suresh,

    I 've a question.. Whether this article needs revamp?? I could see this was written a year back and I doubt.. will it fit for the current time?? considering the value of the mentioned stocks.. If the article needs revamp, then suggest us with the best stocks for long-term.

    Cheers.

    • Suresh says:

      Hi Krishna, These are some of the ideas an year back. The idea is these are good stocks, but you should look for stock price. If they are available at cheaper prices, you should grab them.

  5. Nilesh says:

    Its a very good article.But I have a query.I am a small investor who want to invest in stocks on SIP basis.I am willing to put 2k every month.But I dont know which stocks should I put my money.When market is falling every stock is looking attractive to buy.I want only blue chips.I have Nifty Bees also with me. Should I continue investing in Nifty Bees because i have too much confusion in stock selection.Kindly advise sir.

    • Suresh says:

      Nilesh, This is one of the tricky question to answer. I agree that during falling markets, every thing looks like a beautiful girl. We want to buy all stocks. I am writing an article about some winning stocks early next week, you can try them.

  6. NAVEEN JOSHI says:

    For the first time I came accross your site as I was trying to learn about the stock market. However, besides the above, if can guide more about making initial investment? What would be better investing in shares or mutual fund or both? 

    Thanks and regards.

    NAVEEN JOSHI

    • Suresh says:

      Naveen, Good topic. My immediate answer is that Mutual funds would be a better option in comparing to overall features. But let me analyse both features, positivs and negatives and would revert next week with an article.

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