Lessons from the biggest multibaggers

For equity investors, certain stocks, properly selected, can be ladders to riches. While banks are paying you 6-7 per cent per annum, every few years a handful of stocks can go up 100 per cent or more. Over 10 years some stocks can go up manifold. Here is the data from the past decade of value creation (2013-2022 period) by listed companies. After applying some filters such as liquidity and trading frequency, the following 10 companies have emerged as the highest value creators: Tanla Platforms, Paushak, Shivalik Bimetal Controls, Vidhi Specialty Food Ingredients, Alkyl Amines Chemicals, KEI Industries, HLE Glascoat, Fineotex Chemical, Tata Elxsi, and Uno Minda. How well have these companies done? From an adjusted price of Rs 5.12 in 2013, Tanla Platforms went up to Rs 946 (average price of 2022), which is a stupendous rise of 189 times. Paushak went up 130 times. Shivalik Bimetal was up 126 times over the past decade. What causes certain stocks to rally in this insane fashion when the best of Indian companies cannot deliver more than a low double-digit return? We have been doing this annual compilation for the last 16 years. Here are our observations: