5 HIGH Return HIGH Risk Stocks - Rahul Jain Analysis #growthstocks #highreturnstock

hi friends in this video I want to speak about five high risk and high return stocks and the intention of me talking about these five stocks is not to give you stock recommendations but to introduce you to these five stocks because these are highrisk high return stocks with that let's move to stock number one which is Garden reach ship Builders and Engineers limited have a look at my screen and you will see that this stock in the last one year has given close 2 122% return making a high of 2710 rupees right now at the time of recording this video the stock is trading at 1811 that is a correction of around 33% from its high levels now why this sharp correction of 33% there are three reasons that I could find reason number one is that arara Capital what they are saying is that one of the large orders that the company was expecting in FY 24 has been deferred to FY 26 that's why they are saying that there is a cell rating ICC securities also have a cell rating on this stock because they are believing that there is a lot of pressure in terms of the margins of this particular stock and also Bangladesh crisis might impact their revenues Etc I'll speak about that in a minute right and thirdly wealth Mill Securities what they are saying is that there is a correction in terms of the overall defense stocks and there's a profit booking going on that is the reason that the stock is Dum so in my view the stock is at a very interesting juncture because there is a risk of sentimental correction in this particular stock because people who have invested in this stock in the last one to two years might be sitting at a huge profit and they might be doing some profit booking because of the sentimental fears of overvaluation in the defense stocks and that's why I call this stock as a highrisk stock because there may be further correction in this particular stock but now let me talk about the high returns aspect of this particular stock so Point number one you will note is that the promoters in this company which is the government of India is holding 74% stock and people who have watched my previous video around William O'Neal's seven parameters of picking high growth stocks he talked about the limited supply of the stock quantities and if the promoter holding is more than 74% what does that mean simp that means that the supply of the quantity of the stock is going to be limited in the market right more importantly if you see fi have done some buying it has gone up from 3.26% to 3.9% while the DI have done the profit booking in the quarter of June the stake have come down from 6% to almost 3.20% now two quick points here one is that the majority of di selling in my view has happened in this particular stock and secondly if you do the total of the institutional buying here it is around only 7% so again going back to the previous video William said that if the financial institutions have got low stakes in the company it means that there is a chances of they coming back and buying more stocks and giving the stock a rally right this is the theory that William suggested so in my view from a shareholding perspective it looks very very positive to me now if you look at the valuations of this company you will very quickly note that the PE Ratio has come down because of this 33% correction it has come down to around 58 versus 78p of industry and the PB ratio is 12.81% .85 these numbers are now looking very very manageable as compared to where they were in terms of high PS of 80 or ' 90s but the question you may have is Rahul are these valuations still Justified or not for that if you look at the fundamentals of the company if you look the revenues are all-time high if you look at the profits alltime High last three years growth if you see sales growth is 47% profit growth is 29% if you look at the Roe it's gone up from 18% to 22% but Rahul this is the past right now can you speak about the future visibility of the revenues of this company so let me give you the order book of this company it is standing at 25,000 crores so company that has yearly Revenue run rate of around 4,000 CR not even 4,000 is sitting at 25,000 cres of order book which is almost six times and also the management of the company is guiding for a 25% to 30% of Revenue growth in the next few years which is excellent growth in my view in addition to the strong order book the company is also bidding for a RFP that is going to be order size of huge 36,000 crores which get split into two shipyards it might be mgam it might be coachin Shipyard I don't know the second stock but they are also likely to get some pie of this particular huge order if they are able to win this lastly on my screen you can also see the breakdown of this order book so this is not something that they have built in the air they have actually given the details of this order book and more importantly I want you to focus about the Bangladesh orders which is not even more than 1.2% in terms of their overall order book so there is not a significant risk coming from Bangladesh perspective so Rahul in terms of the risk what is the risk here here so in terms of the risk the only risk I say is that the stock has corrected by 35% there may be some more pressure on this particular stock but right now I think the majority of the selling in this particular stock is done and the order book next 2 to three years of time Horizon looks very very positive to me not a stock recommendation for you but I've given you a lot of details about this particular stock please go and do some more research about this stock before I move to stock number two Let me rade that investing in stocks is highly risky we should never invest 100% of our money in stocks rather we should balance the high risk of Stocks by having fixed return instrument like fds in our portfolio and the reason I say fds is because if you go to stable money platform you will see fds that are giving interest as high as 99.1% not only this nowadays you can use fds to park your cash if you're waiting for Market correction this is because on stable money platform you can withdraw your FD anytime and your money will come back to your account instantly so in case the market corrects and if you want to buy the dip you can go go ahead and withdraw your money from fds and the money will come instantly into your account you can take that money and invest in the markets immediately gone with the days when you had to open a bank account to open a FD in a particular bank with stable money you can open fds with multiple Banks without having to open a savings account with a particular bank already more than 5 lakh people have trusted stable money platform for their fixed return Investments and just for avoidance of any doubt when you book a FD with stable money stable money will directly send your money to the bank your money is not kept by stable money stable money is a platform that is connecting multiple users with multiple Banks you can check out the stable money app you will find the link in the description or in the pin comments let's move to stock number two which is motilal oswal Financial Services Limited the stock in the last fun year has given crazy returns of 231 and let me walk you through what are the risks and what are the return possibilities with this particular Company If You analyze the p&l statement of this company you will notice that from 2013 onwards the company has has been consistently growing except these two years here 19 and 20 where the revenues fell slightly but other than that the top line of the company has been growing consistently and if I show you some numbers in the last 10 years the revenues of the company have grown by 31% cagr while the Pat has grown by around 42% cagr level more importantly if you see just the last year the revenues have almost doubled while the profits have almost tripled and if you look at the trailing 12 months 60% of sales growth has been shown by the company and if you look at the trailing 12- Monon profit growth it has been around 96% now in spite of this huge growth and the rally in the stock prices if you look at the PE of the company it is still at [Music] 16.07% 4 so it's not that the stock is trading at around crazy 50 60 PE levels the stock is in check in terms of the PE and PB ratios and if I quickly speak about the business model of the company company is into three main segments one is that they are selling their own products for example mutual funds their portfolio Management Services alternative investment Etc they also distribute thirdparty products such as insurance bonds fds Etc but more importantly they are into advisory which is the wealth management and this is where the majority of their growth is coming and to back my statement with some data you will very quickly note that their Wealth Management Services which is the largest contributor in terms of the revenue have grown by around 69% year on-ear if you look at the last five quarters and this is why precisely the company has recently announced that they are transitioning from being a broker company to a wealth management company and if you read the statement by their group managing director what he's trying to say is that nowadays there is not money left in the transactional services like broking business people want personalized Investment Services that is where they're moving towards if I show you the shareholding pattern of this company very quickly you will note that in spite of the huge rally in the stock in the last one year the promoters are still holding their Stakes which is a very very good news more more often than not you will see the promoters are selling their Stakes nowadays because of the massive profit booking that is going on but here in this case the promoter Stakes are very very constant which is a very very good news if you look at the FIS and Di very very stable Stakes is what we can see here now couple of high risks with the stock number one is the fno taxes and also sebi's attention to the fno space if I talk about the taxes itself the management is saying is that the overal impact due to taxes is around 10 crores a quarter which is not very huge in my view and the second risk that I I see with this stock if you look at my screen is that the stock has been very very volatile and if you look at the last 6 months the stock has fallen by close to let's say 32% here in the month of March again 22% here in the month of April between April and June 27% here very very recently so the stock has been extremely volatile it is not for weak-hearted investors there may be a lot of volatility in the stock and if you can't withstand that then the stock is not for you but this is a high growth and a highrisk stock so so far if you're liking this video request you to hit the like button let me know in the comments a simple thank you it will motivate me to come up with such content for you at zero cost also you can consider subscribing to my YouTube member Community because I post in-depth analysis of stocks mutual funds and various other assets and I bring almost daily updates from stock market giving you lot of insights simply go to my channel and press the join button with that let's move to stock number three the stock name is infoedge India limited a stock that I spoke about on my channel almost 4 months back 12th April 2024 to be precise and stock at that time was in massive rally and from that time onwards the stock has gone up by almost 30% so a 30% appreciation in the last 4 to 5 months stock has been in a massive massive Bull Run I would highly recommend you to go and watch the full video you are going to learn a lot about this company but let me now bring you latest update about this stock in this particular video so if you look at the q1 results you will very quickly note that the revenues is up by around 99.3% but more importantly their operating profit margins have been maintained at around 35.6% extremely important point that I covered in my previous video I explained what is operating profit margin and so many other things around it please go and watch that but good news is that they have maintained this operating profit margin and if you look at the cash from operations because this is a cash rich company the growth has been around 20% and that is why the stock is still rallying now if I break down key insights from their each business stream for example recruitment which is no.com I talked about how 80% of their revenues are coming from no.com and out of that 80% 50% of their revenues come from it hiring and guess what right now it is a buzzing sector infosis TCS and in fact overall it index has been in a massive Bull Run in the last 4 to 6 weeks it hiring has been picking up in the last 4 to 6 weeks in fact I was reading an article in Economic Times just yesterday where in foris has emailed the freshers where the joining date was paused from last two years have given the joining date of 7th of October so there is a lot happening in it sector and if the it hiring is going to pick up in the next four to six months this stock is going to do very very good in terms of the top line as well as bottom line coming to their second business stream 99 acres.com which is a loss making business but more importantly if you see the operating profits the loss have narrowed down by around 41% which is a very very good news if you look at the cash losses that you will see it used to be around 72 CRS it has come down massively by 81% so a good turnaround story is what I can see in 99 Acres .c overall very similar story in gan.com their another business stream you will see their operating losses have come down by almost 44% their cash from operations have also improved by around 56% if you look at their education workstream which is shika you will see that the revenues have grown by almost 18.4% cash is looking very very good overall all the business stream are doing really really well right now people who don't know they have also heavily invested in stocks like zamato PB fintech or policy Bazar both the stock have been in massive Bull Run also the compan is gaining from that as well now comes the valuation if you look at the info Edge India limited's PE ratio it is a massive 152p very high PE but let me also tell you when I created the video 4 months ago at that time the PE ratio of this company was almost at around 352 level and if you look at the median PE the PE chart in the last 3 years the company trades at a median PE of 126 right and right now the p is at around 152 and if you look at the price to book ratio in the last three years Again The Price to Book ratio has been around 3.5 median PB right now the stock is trading at below median PB which is at around 3.2 level so what is the risk with this particular stock Rahul so in my view the stock is trading at all-time high value of 7,500 level and the chances of Correction or the risk of Correction remains very very high although the stock is growing Leaps and Bounds the chances of Correction and the risk of Correction is always there with such stocks with that let's move to stock number number four which is Zen Technologies limited have a look at my screen you will see that in the last one year stock has given a massive rally of 107% I've spoken about this particular stock a lot of time on my YouTube member community and if you want to get regular updates on various stocks then you can consider subscribing to my YouTube member Community but now coming back to the shareholding pattern of this particular company you will very quickly note that in the last one quarter the promoter stake have come down but if you look at the DI stakes and the FI Stakes that have gone up and this is happened because mainly this company issued a qip which is qualified institutional placement and if I show you some data the company issued this letter here which is on August 24th what you will note here is that the company did the qib at an issue price of around 1,600 rupees per share and the companies like kotak mutual fund White Oak offshore Fund motilal oswal mutual fund have subscribed for this qip and that is why precisely the promoter Stakes have come down and the dis and fi Stakes have gone up but what really it tells me is that the price of this stock is now set at around 1,600 rupees level because these mutual funds have bought it it doesn't mean it cannot fall it can definitely fall but to me there is a psychological Mark here in terms of the price level of around, 1600 rupees per share now if I speak about the fundamentals of this company very quickly you will note that the revenues of the company has almost doubled in the last one year and the profits have almost 2.5 times in the last one year and if you talk about the future revenues and profitability the order book of the company right now now is at around 1158 crores which is almost three times than their yearly Revenue run rate that we are seeing right now what does the company do two key products one is the training simulators for the armed forces and second is the empti Drone systems and you can also see the breakdown between domestic and Export so there is a good balance here as well also very recently the company launched AI powered robots and four new defense products for the global market you can read this commentary here and the moment this news came out in the market the stock r anything because there is a prospect of future revenue and profitability coming from these new products as well if I speak about the valuation of this particular company the PE ratio of this company right now is very high 99 and PB ratio is extremely high almost three times the industry PB but see there is a reason that mutual fund houses have bought this particular stock at this very high valuation because they are seeing the future earning possibilities in this company and if you look at the PE ratio chart in the last 3 years the median PE of this company has always been 94.55% this company trades at a very very high P level and this is why I say these sort of stocks are high risk and high return stocks right now the p is at around 99.47 if I talk about the PE ratio of this company if you look at that very quickly from a PB ratio perspective the median in the last three year has been 8.5 right now that is trading at around 31.6 highly overvalued from its median PB ratio but that's what the investors are right now willing to pay price for because of the future earning possibilities in terms of the risk with this stock the stock has has come down by almost 15% if you look at the top highs that it made at around 1978 levels could this stock fall below, 1600 rupees level that remains a risk with this particular company as I said these are the highrisk high return sort of stocks let's move to stock number five which is Shakti pump limited and have a look at my screen you will see the last one year stock have ried by almost 400% massive rally in this particular stock but in spite of this massive rally if you look at the valuations of this company PE ratio is still at 38.5 versus industry PE of 43.3 the leader in this particular segment is ksb which is trading at a very high PE of 73 right the PB ratio of this company is 11.91% has been 121% growth and if look at the compounded profit growth rate in trailing 12 months it has been around 1323 c. you can see the massive profit growth rate here happening the revenues are alltime high why this is happening because of the PM kusum scheme so what is the PM kusum scheme there are three components to the scheme but more importantly component B is what we need to focus on right now so if you look at the farmers across India you will see Farmers using diesel driven pumps to do Irrigation in their Farms right now what government said is is that farmers please get rid of these diesel driven pumps and install the solar driven pumps and this is where this company comes the company is producing solar pumps for irrigation purposes mainly so this component B itself has given them a order book of around 2,000 cres as of now and what their management is saying is that this 2,000 cres of order book they are going to execute in the next 15 months so there is a huge Tailwind right now coming from this component B of PM kusum but more importantly the company is projecting around 30% % of growth in the next few years this PM kusum scheme please go ahead and read about it there is a component c as well where these pumps will directly get connected to the grid which is powered by the solar energy right this is where the company is right now working on and you can read this commentary here that they are excited about component C which will get implemented hopefully in the next two to three quarters they will start to see some good traction on this particular one which is not included in this current order book so in my view there is a good positive future that I can see right now in this particular stock but coming back to the risk aspect of this particular stock the stock has given a massive rally it has gone up from like 1,600 level to almost like 4,300 level right now the stock touched all-time high of 5,000 levels so there is going to be a danger of Correction it is not advisable to enter into these stocks at these price levels but what I have done is I've given you gist of this particular stock in terms of why this is a high growth stock in the coming few years and the key risk Remains the valuations right now but if I look at the the shareholding pattern of this company you will very quickly note that FIS have bought the stock at even this high price level and Di have done some profit booking in the last quarter while the promoter Stakes have been constant in the last two quarters so far I have spoken about five high risk and high return stocks in this particular video in fact let me know in the comments any high risk and high return stocks in your watch list I would love to know about that let me know in the comments also please understand that investing in direct stocks is highly risky so please make sure you have a balanced portfolio and in my view fixed deposit it are a very good way to bring balance into your portfolio so check out stable money platform for fds that are giving as high as 99.1% returns you will find the link in the description or in the pin comments I'll see you in my next video Until then keep rocking