What is the best stock of India to earn a 200% return by 2025?

Posted by TB

August 14/2022 19:23 PM IST

Hello Traders,

I have given many similar answers to this and I will provide their links in the end. The first and most important thing is there are many stocks which have strong potential to give more return the n you can expect.

nowadays inflation is at an all-time high due to war and covid situation. Union Minister Hardeep Singh Puri on Thursday said that other countries are facing very steep inflation as compared to India currently.

Reacting to a question on high prices of fuel, the Union Minister of Petroleum and Natural Gas while addressing a press conference Wednesday said, " Economies of other big countries are facing steepest inflation and a sharp decline in living standards since World War II. It is a phenomenon. We are in a situation where we can control prices to the extent we can."

"We can only control prices to some extent and give relief to the citizens", he said adding that the living standards in a lot of other countries other than India have declined due to high inflation.

Retail inflation in India surged to 7.79 percent on an annual basis in April owing to higher edible oil and fuel prices, data from the Ministry of Statistics and Programme Implementation stated in May. The headline inflation is now at the highest level since the 8.33 percent hit in May 2014.

The surge in inflation is largely driven by rising fuel and food prices, government data showed.

The consumer price-based inflation figure stayed well above the Reserve Bank of India's (RBI's) upper tolerance limit for a fourth consecutive month. RBI has been mandated by the Centre to keep the retail inflation between 2 percent to 6 percent.

Food inflation, which accounts for nearly half the consumer price index (CPI) basket, reached a multi-month high in April this year and can remain elevated due to higher vegetable and cooking oil prices globally. RBI mainly considers the retail inflation figure while arriving at its bi-monthly policy decision.

Sunil Kumar Sinha, Principal Economist, India Ratings and Research said to ANI, "Based on the present trend, average inflation in FY23 is likely to be closer to 7 percent and may peak in September 2022 thereafter declining marginally. RBI has increased the repo rate by 40bp and CRR by 50bp in May 2022. India Ratings expects monetary tightening to continue and expects repo rates to increase by 60-75bp and CRR by 50bp in FY23. However, India Ratings believes the future rate hikes will be data-dependent."

Sachin Gupta, CEO of Share India Securities said to ANI, "Due to the ongoing geopolitical tensions and high commodity prices, it was expected that the inflation numbers will be on the higher side. Anticipating this, RBI has already started fiscal tightening by increasing the repo rate. With the global uncertainty continuing and commodity prices remaining high, the inflation numbers may witness upward pressure in coming months also."

DK Mishra, an economist had said, "What we see RBI will try to increase the repo rate further. There is one more possibility that RBI may increase the upper comfort level of inflation, to more than 6 percent which can be an accepted phenomenon for the time being to see that inflation will continue to trouble us in the short-term period.

So here I am recommending a stock in which you can invest and get more than you expect:

• ITC LTD. - I know it is almost at a lifetime high but you can still invest in this as this will grow amazingly in coming years till 600–800–1000.

ITC has 5 Business segments:

1. FMCG
1. Cigarette
2. Food
3. Personal care
4. Lifestyle
5. Matches & Incense Sticks
6. Education & Stationery
2. Hotel
3. Packaging
4. Agri-Business
5. IT Service

The above list is not exhaustive, there are many mini-business segments that are explored every day. Decent Network expansion, Focusing on rural demand, Consistent cashflows, Debt-free, Handsome dividend yield packed with Good Corporate Governance standards maintained throughout the years. A point of discussion will be the decreasing sales over the years but still, it's a solid bet as they are working a great deal on OPM% and maintaining growth in Net profit. So, it’s a solid bet.

While the Nifty touching new peaks and almost every other Tom, Dick, Harry stock with no fundamentals giving at least 60%+ return, why has this gem of a company is not moving for a decade? The reason lies with ESG(Environmental, Social & Governance) standards not being matched due to cigarette dominance in the ITC sales story. This restricts various FPIs & FIIs to take a position in this scrip as they have a stringent policy on ESG for their funds.

So, will this continue forever, and do we have to be just happy with dividends? No. They are planning to demerge the stock i.e. ITC HOTELS, ITC FMCG, ITC, etc. This was an argument put out on ET Now & Newspapers in line with the group moving forward thoughts.

A point of concern for their growing cigarette business is the decrease in demand and exponential growth in the local market brands. This same situation was faced by the auto ancillary domain in 2015–2018 & automobile in 2017 with the growing presence of the used automobile, which I guess was taken too seriously by the Maruti Group and TrueValue was born.

Coming to the point, many clarifications are to be put on the table to get a value of 1000+ for ITC.

Maybe 600+ targets come around 2023 end and if you will wait till 2025 then it might come to 800–1000.

I hope you liked my answer and hope it will help you too. Please share your feedback regarding my answer and keep upvoting and sharing.

Thank you