The year 2024 is taking the stock market rally of 2023 forward. This is evident as the Nifty 50 and the BSE Sensex recorded new levels on the back of quarterly results of IT majors. The year 2024, being a year of elections in India and in the United States of America, can give mixed results. However, analysts and investors expect a nine percent increase in the stock markets this year.
Research and Ranking is a SEBI-registered wealth advisory with 8+ years of experience offering research-based wealth creation advice. We possess a reputation for helping our clients choose high-growth stocks in India.
Growth stocks are shares of a company expected to grow significantly above the market’s average growth. Companies of high-growth stocks generally do not issue dividends, as they reinvest the earnings to accelerate growth in the short term. Growth stocks are considered riskier with the potential for greater upside.
This blog will show the top high-growth stocks to invest in today and what makes them great buys. We consider the most recent available information to understand their prospects in 2024.
Reliance Industries Limited
Company Info – Reliance Industries Limited is a leading conglomerate with diverse business interests in refining, petrochemicals, retail, telecom, renewable energy, digital services, and media & entertainment.
In the period under review, Jio Financial Services listed on the bourses in August 2023.
Quarterly Performance: Reliance Industries delivered a mixed bag for Q2 FY24, with some segments exceeding expectations and others falling short. Consumer businesses like retail and Jio soared, while the oil-to-chemicals segment dropped. Retail and Jio profits surged on strong demand, while the upstream oil & gas segment boomed. However, lower oil prices and weak global demand hit O2C revenue and margins.
Future Prospects – In FY’24, capital expenditure will peak to complete the 5G network by year-end. Earnings are expected to be strong in the consumer businesses, and there is a positive outlook for O2C business amid tight fuel markets, a robust domestic market, and limited new-builds. MJ field production ramp-up is on schedule. However, supply uncertainties keep gas prices elevated.
Sun Pharmaceutical Industries Ltd.
Company Info – Sun Pharmaceutical Industries Ltd. is the biggest pharma company in India and the fourth-largest specialty generic pharma company in the world. It is present in specialty, generics, and consumer healthcare products.
In the quarter under review, the company launched eight new products in the Indian market.
Quarterly Performance – The pharma company reported an 11% increase to Rs.120,031 million in gross sales during Q2FY24 over Q2FY23 based on notable formulation sales in India (11.1%) and Emerging Markets (13.3%). Sales in the Rest of the World (ROW) grew 17.7% in the quarter under review. The net profit stood at Rs. 23,755 million, up 5% y-o-y.
Consolidated Q2FY24 R&D investment was up 35% at Rs. 7,734.4 million from Rs. 5,710 million in the previous quarter of 2023.
Prospects – As per Dilip Sanghvi, Managing Director, Sun Pharmaceutical Industries Ltd, the US FDA has accepted deuruxolitinib NDA to treat moderate to severe alopecia areata and is awaiting approval from the US FDA. Also, positive phase-3 data in patients of Nidlegy, a drug for skin cancer, is expected to up Sun Pharma’s position to provide solutions to a broad spectrum of skin cancers.
With the acquisition of Taro Pharmaceuticals and Libra Merger Ltd., both Israeli pharma companies, the Indian drugmaker plans to consolidate its Israeli operations.
ITC Limited
Company Info- ITC is one of the leading FMCG conglomerates in India with interests in FMCG, hotels, paperboards, specialty papers, packaging, agribusiness, and Information Technology.
During the period under review, the Board of ITC approved acquiring a 25% stake in Maharaja Heritage Resorts Limited from Russel Credit. Also, the board approved the demerger of the hotel business into ITC Hotels Ltd.
Quarterly Performance: During Q2FY24, ITC reported consolidated revenues amounting to Rs.17,774 crore. ITC strengthened its position as a leading FMCG conglomerate despite a challenging environment. ITC thrived on customer focus, digital strategies, and operational excellence. Cigarettes and FMCG soared with enhanced distribution and innovation, while hotels saw strong occupancy. The net profit for the period was up by 6.12% to Rs. 4,956 crore from Q2FY23. Net profit after M.I & Associates was Rs.4,898 crore, up 6% from Rs. 4,620 crore in the previous year’s comparable quarter.
However, the paper and agri segments faced headwinds, highlighting the company’s mixed performance.
Prospects – With strong visibility pan-India, a 14% CAGR in three years, 300 product launches, and the defensive nature of its business, given the macroeconomic environment, it could make it a stock you can consider. Also, significant cost savings and higher revenue growth from supply chain and digital initiatives bode well for investors.
State Bank of India
Company Info – The State Bank of India is India’s largest commercial bank. It enjoys a reputation of existence for 200 years with a branch network comprising 22,405 branches and 65,627 ATMs/ADWMs.
Quarterly Performance: The country’s largest commercial bank reported a nine percent rise in net profit during Q2FY24. Net profit in the quarter under review was Rs. 16,383.18 crore. SBI’s income grew by 26% from Rs.1,14,782.48 crore to Rs.1,44,256.12 crore in Q2FY23. While the top line and profitability grew, rising provisions and expense pressures tempered the performance. The ongoing struggle with NPAs remains a concern. Nevertheless, there has been considerable improvement in the percentages of gross NPAs and Net NPAs. The former stood at 2.55%, while the latter at 0.64%.
However, signs of growth in critical areas like interest and non-interest income offer some optimism for the future.
Future Prospects – As the economy recovers and the lending picks up, a sound loan portfolio, improved asset quality, and a proposal pipeline worth Rs.4.8 lakh crore could push growth to 14%.
HCL Technologies
Company Info – HCL Technologies Ltd is a leading global IT services company. It has a portfolio of services, including software-led IT solutions, remote infrastructure management, engineering and R&D services, and BPO.
Quarterly Performance – The IT services company reported a rise of 6.5% to Rs.28,446 crore y-o-y during Q3FY24 in INR revenue. The net profit posted a 13.5% rise to Rs.4,350 crore y-o-y.
Constant currency revenue rose 4.3% y-o-y, while USD revenue rose 5.3% to US$ 3,415 million q-o-q.
Future Prospects – During the quarter under review, the company won 18 deals across retail & CPG, life sciences, healthcare, public services, and financial services, among others. It also bagged nine Gen AI deals during the quarter under review. It filed and was granted 41 patents.
For FY24, HCL Technologies’s growth (including ASAP acquisition) will likely be between 5-5.5 percent y-o-y. Also, the leadership is confident of the growth momentum brought about by its business mix, human resources, and focus on delivering hyper-automation and innovation to clients.
Conclusion
The Indian market presented a diverse picture in Q2FY24, with robust growth in some sectors and challenges in others. Overall, cautious optimism prevails for companies with solid fundamentals, diverse portfolios, and a commitment to future-proofing their businesses. While individual segments may face challenges, focusing on growth and emerging trends promises a dynamic and evolving Indian market in the coming quarters.
