Elite, high-value stocks take a huge beating as bears run amok on D-Street

NEW DELHI: When the bears roared on Dalal Street, even the high and the mighty crumbled, and how!

The meltdown in the domestic stock market over the past two years spared none; stocks across market caps took a huge beating and even the high-value stocks, once seen as successful wealth generators on consistent earnings growth, were not spared.

That even when these pricey companies were reporting healthy earnings quarter by quarter, which helped them enjoy high PE values and rally at a time when earnings visibility was limited elsewhere.
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Yet, they all crumbled in the market meltdown.

Data suggests the top 10 stocks on the BSE in terms of share price (Rs 5,700-31,700) have fallen anywhere between 14 per cent and 43 per cent from their 52-week high levels.

Bosch, which closed at Rs 15,929.75 on Friday, has lost 42 per cent since it hit its 52-week high of Rs 27,989.25 on March 20, 2015, which was also the all-time high level for the stock. The stock had rallied 180 per cent from Rs 9,995 on January 3, 2014 to its peak level. Bosch’s standalone profit doubled to Rs 220.77 crore in the quarter ended December 31.

Page Industries shares were down over 7 per cent to Rs 9,970.05 in Tuesday’s trade. The exclusive licensees of Jockey International for manufacture and distribution of the innerwear brand has seen its stock fall 41.3 per cent from its 52-week high of Rs 16,995. The stock, which has risen 563 per cent in the past five years (from Rs 500), has fallen 20 per cent in last one month.

“The fall in some of these stocks has been huge, but not as acute as in some other counters. Price multiples have come down even for quality stocks. The extra premiums these high-value companies were enjoying have come down, as the peers start looking attractive. It is a human psychology that people sell stocks when they are making profits, and not when they are suffering losses. As these stocks were offering stellar returns even after some marked-to-market losses, investors started taking part of profits off the table on some of these counters,” said DK Aggarwal, CMD at SMC Investments and Advisors.

Page Industries reported Rs 52 crore net profit for the December quarter compared with estimates of Rs 58 crore. Revenues at Rs 440 crore fell short of expectations of Rs 453.3 crore. This has triggered selling on the counter.

Shares of tyre maker MRF have fallen 19 per cent to around Rs 33,132.60 level from the 52-week high of Rs 46,405.35 hit on August 5, 2015.

MRF reported a 19.98 per cent rise in standalone net profit at Rs 388.15 crore for the December quarter. But net sales for the quarter declined to Rs 3,256.16 crore from Rs 3,351.68 crore in the year-ago period. This stock has risen 438 per cent in the past five years.

Eicher Motors, another high-value stock, has fallen 14 per cent to Tuesday’s low of Rs 18,641 from its 52-week high of Rs 21,618.30 level. The company has reported 76.1 per cent YoY increase in consolidated net profit at Rs 270.80 crore for the December quarter.

This stock has skyrocketed 1625 per cent in the past five years.

Tide Water Oil Company (up 227 per cent in 5 years), 3M India (up 235 per cent), Shree Cements (532 per cent), Honeywell Automation (up 277 per cent), Blue Dart Experts (up 456.90 per cent) and Polson (up 806 per cent in 3 years) are some of the high-value stocks that have corrected between 18 per cent and 26 per cent from their 52-week high levels, after seeing a massive rally in the past 3-5 years.

Meanwhile, the BSE Sensex is trading around 20 per cent down from its all-time high level of 30,024.74 hit on March 3, 2015.