3 stocks of Nifty Smallcap 50: Giving high returns in the short term

3 stocks of Nifty Smallcap 50: Giving high returns in the short term
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Short-term trading can be emotionally charged due to rapid price fluctuations. Make decisions based on research and strategy rather than emotions. Keep track of news and developments related to the companies in the Nifty Smallcap 50 index. Earnings releases, management changes, regulatory updates, and industry news can all impact stock prices. Stay informed about broader market trends, economic indicators, and sector performance that could impact the Nifty Smallcap 50 index.

long term investment point of view

See, we have already heard that if you want to make a safe and long-term investment in the stock market, then for that only the stock of large cap company should be held because it gives good returns in the long term. 

Also, after the market crash, there is a limit of the loss price of the stock, below which the price of the stock cannot go, so your investment in large cap companies is never zero. But let us talk about short term investment then the stocks of large cap company are not able to perform well in short term due to which we do not get good returns.

Short term investment point of view

There are many such small cap companies listed in the stock market, in which the growth potential is very high. There is a specialty of small cap stock that if the market is going very high, then the price of the stock also increases rapidly and the same. If the market is falling, then the prices of small cap stocks fall as fast as possible. If we want to invest for short term and get good returns, then the best option for that is the stock of small cap companies. But in small cap There are both high return and high risk. 

Also Read : 5 Best Performing Large Cap Companies in FY 23-24: Worth investing to get high returns

Analyzing for small cap stock

If you have a good knowledge of stock market, then you can easily analyze in which year which small cap index or stock will be on its high pick and when on low pick and which stock has the potential to move forward, Accordingly, you can invest in Small Cap Index for 1 year or 3 years.

In this post, we are going to discuss about 3 such small cap stocks which have done very well in terms of returns:

Best 3 Small Cap Stocks

1. Cyient ltd

Returns of Cyient ltd

    Cyient ltd has given returns of 126.47% in last 5 years, 380.54% in 3 years and 89.71% in 1 year. In this, you can understand that the way the inflation rate is increasing by 6%, which is not affecting your returns, at least you need 12% returns to stay away from the effect of inflation and this in the stock you are getting returns of more than 12%

    The current stock price of Cyient ltd is ₹1,561.75. If you hold 500 stocks of Cyient ltd for 3 years, you can get a return of 380.54 %, that is, if you have invested a total of 1561.75*500=₹7,80,875.  So after 3 years you will have an income of 7,80,875*380.54% = ₹29,71,542 in which your profit will be ₹21,90,667 i.e. You will get three times the return of your investment.

    Financial performance of Cyient ltd

    In the first quarter of the financial year 23-24, the total income of Cyient ltd has been ₹ 1449.60 crore and a growth of 3% has been seen in PAT, which we call profit after tax. EBIT has seen a growth of 5.73%. The net profit margin of the company is to be 9.91%, which means net profit of about ₹ 144 crore has been made. Cyient ltd.’s EPS has been ₹ 15.35 while the previous quarter was around ₹ 7.  Also, the current PE RATIO of the company is ₹ 30.50.

    2. KPIT Technologies Ltd

    Returns of KPIT Technologies Ltd

    KPIT Technologies Ltd has given returns of 1593.13% in last 3 years and 380.54% in 1 year. The current stock price of KPIT Technologies Ltd is ₹1,146.25. If you hold 500 stocks of KPIT Technologies Ltd for 3 years, you can get a return of 1593.13 %, that is, if you have invested a total of 1,146.25*500=₹5,73,125. So, after 3 years you will have an income of 5,73,125*1593.13 % = ₹91,30,626 in which your profit will be ₹85,57,501 i.e. You will get seventeen times the return of your investment.

    Financial performance of KPIT Technologies Ltd

    In the first quarter of the financial year 23-24, the total income of KPIT Technologies Ltd has been ₹ 1119.13 crore and a growth of 20.07% has been seen in PAT, which we call profit after tax.IT has seen a growth of 9.33% and EBIT has seen a growth of 30.60%. The net profit margin of the company is to be 12%, which means net profit of about ₹134 crore has been made. The company’s EPS has been ₹ 5 while the previous quarter was around ₹4. Also, the current PE RATIO of the company is ₹73.15.

    3. BSE Ltd

    Returns of BSE

    BSE has given returns of 414.52% in last 3 years, 29% in 1 year and 214% in 5 years. The current stock price of BSE is ₹861.30. If you hold 500 stocks of BSE for 3 years, you can get a return of 414.52%, that is, if you have invested a total of 861.30*500=₹4,30,650.  So, after 3 years you will have an income of 4,30,650*414.52% = ₹17,85,130 in which your profit will be ₹13,54,480 i.e. You will get three times the return of your investment.

    Financial performance of BSE

    In the first quarter of the financial year 23-24, the total income of BSE has been ₹271.49 crore and a growth of 76.57% has been seen in PAT, which we call profit after tax. IT has seen a growth of 10.84% and EBIT has seen a growth of 88.86%. The net profit margin of the company is to be 33.59%, which means net profit of about ₹91.2 crore has been made. The company’s EPS has been ₹ 6.64 while the previous quarter was around ₹3.76. Also, the current PE RATIO of the company is ₹52.87

    Frequently asked questions (FAQs)

    What are the key financial performance indicators investors should look at when evaluating a small cap company?

    Important financial indicators include total income, profit after tax (PAT), earnings per share (EPS), net profit margin, and trends in revenue and profitability.

    What are the returns of Cyient Ltd over the last few years and what do they indicate?

    Cyient Ltd has shown returns of 126.47% over 5 years, 380.54% over 3 years, and 89.71% over 1 year. These returns outpace the inflation rate, but what other factors should I consider when evaluating these returns?

    Could you explain the calculation of potential returns for holding 500 stocks of Cyient Ltd for 3 years?

    The example given illustrates potential returns for investing in Cyient Ltd, but how does this calculation account for market fluctuations, external factors, and other potential risks?

    What is the significance of Cyient Ltd’s financial performance in the first quarter of the financial year 23-24?

    A growth of 3% in PAT, 5.73% in EBIT, and a net profit margin of 9.91% have been mentioned.

    How does Cyient Ltd’s PE ratio impact its valuation and attractiveness to investors?

    A current PE ratio of ₹30.50 is provided for Cyient Ltd.

    What are the key drivers behind KPIT Technologies Ltd’s significant returns in the last 3 years?

    KPIT Technologies Ltd has seen returns of 1593.13% in 3 years. What factors have contributed to this impressive growth, and how do they compare to industry averages?

    Can you elaborate on the growth percentages seen in KPIT Technologies Ltd’s first quarter of the financial year 23-24?

    A growth of 20.07% in PAT, 9.33% in IT, and 30.60% in EBIT has been mentioned. How does the company’s financial performance in these areas impact its potential for future growth?

    What factors have driven BSE’s returns over the last 3, 5, and 1 year(s)?

    BSE has shown returns of 414.52% in 3 years, 214% in 5 years, and 29% in 1 year. How have market conditions and the company’s performance contributed to these returns?

    Disclaimer

    Investing in stocks, particularly in small cap companies, carries inherent risks, including but not limited to market volatility, potential loss of capital, and unexpected market developments. Past performance is not indicative of future results, and investment decisions should be made after careful consideration of one’s individual financial situation, risk tolerance, and thorough research. By accessing and reading this content, you acknowledge and agree to the terms of this disclaimer.

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