Many of us know that investment in stocks are high risk. Experts always advice investors to invest in index stocks or top performing stocks from Nifty50 which could be sure shot winners. However picking up such stocks from this list is biggest challenge. What if we can filter some stocks which are consistent performers in the last 1 year, 3 years and 5 years? What if such stocks always beaten Nifty50 index during this period? In this article we would details about 5 Best Low Risk High Return Stocks to invest in 2022 which have beaten the index consistently.
How we filtered these Top 5 Low Risk High Return Stocks?
This is a continuation series to our earlier article about Top 5 Multibagger Stocks that are doubling every 4 years and 5 Midcap Multibagger Stocks that tripled every 3 years.
Nifty50 has generated 6% returns in last 1 year, 44% returns in last 3 years and 68% returns in the last 6 years.
We followed below approach to filter these low risk high return stocks.
1) We have filtered stocks that have be beaten Nifty50 in last 1 year (> 6% returns). We could get 21 stocks out of Nifty 50 stocks.
2) We further short listed stocks that have beaten Nifty50 returns in last 3 years (>44% returns) from this list. We could get 15 stocks out of these 21 stocks.
3) We have again filtered stocks that have beaten Nifty50 returns in last 5 years (>68% returns) from this list. We could get 5 stocks out of these 15 stocks.
Means, these Top 5 Stocks have generated over 6% returns in last 1 year, over 44% returns in last 3 years and over 68% returns in last 5 years. This is irrespective whether there was covid pandemic, Russia-Ukrain War, fear of recession, fear on interest rate etc. This list also proves that such stocks sustained in recent fall of over 15% of Nifty50. Hence we have classified these stocks as low risk and high returns stocks.
5 Best Low Risk High Return Stocks to invest in 2022
Here is the list of these low risk high return stocks.
1) M&M
2) Bharti Airtel
3) ICICI Bank
4) SBI
5) Adani Ports
Top 5 Low Risk High Return Stocks in 2022 – Detailed View
Let us understand these company business, financial performance and how they performed in the last 1 to 5 years.
1) M&M – CMP Rs 1,181
About the Company
Mahindra & Mahindra Limited operates in nine segments. The automotive segment includes sales of automobiles, spare parts and related services. Farm equipment segment includes sales of tractors, spare parts and related services; information technology (IT) services, which consists of services rendered for IT and telecom; financial services includes services relating to financing, leasing and hire purchase of automobiles and tractors; steel trading and processing includes trading and processing of steel; infrastructure includes operating of commercial complexes, project management and development; hospitality segment includes sale of timeshare; Systech segment includes automotive
Financial Performance
Its standalone revenues grew from Rs 48,685 Crores in FY18 to Rs 57,445 Crores in FY22.
Its standalone margins grew from Rs 4,356 Crores in FY18 to Rs 4,935 Crores in FY22.
Positive Factors in the company
Strong revenue growth in the last 5 years
Strong profit growth in the last 5 years
Strong Annual EPS Growth
ROE and RoA improving in the last 2 years
Book value per share increasing in the last 2 years
Negative Factors in this company
There is increasing trend in non core income.
Share Price Performance
1 year – 55%
3 years – 106%
5 years – 69%
2) Bharti Airtel – CMP Rs 678
About the Company
Bharti Airtel Limited is the leading telecom services company in India that requires no introduction. It operates in 18 countries across South Asia and Africa, as well as the Channel Islands.
Financial Performance
Its revenues grew from Rs 25,747 Crores in FY18 to Rs 31,500 Crores in FY22
Its margins grew from Rs 983 Crores in FY18 to Rs 3,001 Crores in FY22
Positive Factors in the company
Company has strong revenue growth in the last 5 years
Company generated strong profit growth in the last 5 years
Strong Annual EPS Growth
RoCE, RoE and RoA improving in the last 2 years
Company with zero promoter pledge
Negative Factors in this company
Company has high debt
Company not able to generate net cash
Share Price Performance
1 year – 31%
3 years – 103%
5 years – 79%
3) ICICI Bank – CMP Rs 800
About the Company
ICICI Bank Ltd is India`s second-largest bank. The service offered by the company includes Deposits, Loans ,Cards, Investments & Insurance & Demat. In the NRI segment services offered include Money Transfer, Bank Accounts, Investment, Home Loans, Insurance, Loans against FD, etc.
Financial Performance
Its revenues grew from Rs 62,162 Crores in FY18 to Rs 95,406 Crores in FY22
Its margins grew from Rs 9,100 Crores in FY18 to Rs 25,784 Crores in FY22
Positive Factors in the company
Company had strong revenue growth in the last 5 years
Its margins have improved significantly in the last 5 years
Book value per share is increasing in the last 2 years
FII and FPIs are increasing their stake in the company
Strong momentum in share price in short term, medium term and long term
Highest analyst ratings with upside of over 25%
Negative Factors in this company
Company not able to generate net cash
Increase in NPA in recent results
Share Price Performance
1 year – 22%
3 years – 92%
5 years – 161%
Earlier we have recommended ICICI Bank in Top 5 Consistent Peforming Bluechip Stocks to invest in India article.
4) SBI – CMP Rs 514
About the Company
SBI is the largest Indian Bank with 1/4th market share. It serves over 45 crore customers through its vast network of over 22,000 branches, 62617 ATMs/ADWMs, 71,968 BC outlets.
Financial Performance
Its revenues grew from Rs 228,970 Crores in FY18 to Rs 289,972 Crores in FY22.
Its margins grew from loss of Rs 4,177 Crores in FY18 to profit of Rs 43,775 Crores in FY22.
Positive Factors in the company
Strong revenue growth in the last 5 years
Strong profit growth in the last 5 years
Zero promoter pledge
Book value per share is increasing in the last 2 years
FII and FPIs are increasing their stake in the company
Strong momentum in share price in short term, medium term and long term
Brokerages upgraded their ratings with target price in recent times
Negative Factors in this company
Company with high debt
Company not able to generate net cash
High interest payments compared to earnings
Rising other income with low operating income
Share Price Performance
1 year – 22%
3 years – 44%
5 years – 76%
You may like: 10 Best Dividend Yield Stocks to invest in 2022 (6% to 10%)
5) Adani Ports – CMP Rs 754
About the Company
Adani Ports and Special Economic Zone Limited formerly known as Mundra Port and Special Economic Zone Limited, is India’s largest private multi-port operator. APSEZ represents a large network of ports with India’s largest SEZ at Mundra.
Financial Performance
Its revenues grew from Rs 11,322 Crores in FY18 to Rs 15,934 Crores in FY22.
Its margins grew from Rs 3,689 Crores in FY18 to profit of Rs 4,602 Crores in FY22.
Positive Factors in the company
Strong revenue growth in the last 5 years
Strong profit growth in the last 5 years
Promoter increasing share holding quarter on quarter
Book value per share is increasing in the last 2 years
Strong momentum in share price in short term, medium term and long term
Negative Factors in this company
Mutual fund houses has reduced their share holding in recent times
Recent results show declining profits
Share Price Performance
1 year – 12%
3 years – 86%
5 years – 98%
Disclaimer: This article is for educational purpose only. Investment in stocks are high risk. I keep analysing various stocks to personally invest in them. I am already investing in some of the above stocks and would add them in future too. Please consult your financial advisor before investing in any of these stocks.
Have you liked our tips and analysis? Then share it on your Facebook, Twitter, Telegram and other social media which might be useful to your friends too.
- 11 Genuine Ways to Make Money in Free Time (Online + Offline) - June 5, 2023
- 17 Best Debt Mutual Funds to invest in 2023 (as per ChatGPT) - June 3, 2023
- Indel Money NCD Bonds June 2023 – Doubling Investment in 6 Years - June 2, 2023
I’m interested in talking to you to seek your advice for investment in equity. Would appreciate if we can speak.
You can mail your queries to [email protected], I would be able to help you
very useful information, Thanks for amazing information .
Well researched article.My sincere thanks for this type of recommendations for investor’s welfare.
Thank you Arumugavel