»Profit Hunter by Equitymaster

On This Day - 5 FEBRUARY 2020
Buy this 'Crorepati Stock' and You Could End Up Stinking Rich

Richa Agarwal, Research analyst

The markets didn't like the budget. They made this more than clear with a 1,000 point fall in the Sensex.

But here's the thing. Bad budget or good...

Nothing can stop a stock whose time has come.

In fact, events like these that are perceived as 'bad' are the perfect time to go hunting for certain stocks that go on to create massive wealth for their investors.

The reason for this is simple.

The biggest money is made in the stock market by buying high-quality stocks which are beaten down and then holding on to them until they hit a high again.

If the bad news from the economy wasn't enough, we have the coronavirus scare. And to top it all, we now have this budget that the market hates.

And all this bad news has had its biggest effect on the stocks of smaller companies.

In fact, there has been an increasing neglect of smaller companies. Investors, who were in love with smallcaps as recently as 2017-2018, have now lost interest.

That's why liquidity of smaller companies has taken a massive beating. It's down from a high of over Rs 50 billion to just Rs 5 billion.

Now, liquidity is a funny thing...

It may have very little effect on the fundamentals and the intrinsic value of the business. Yet stock market investors generally love higher liquidity stocks, i.e. stocks that are traded in large quantities. The higher, the better and the lower, the worse.

So much so, that most investors completely leave out stocks below a certain liquidity level.

Is this something to be worried about?

Not at all. In fact, this is very good news indeed!

{inlineads1}

This is a very natural part of the small cap cycle. Liquidity tends to increase as stock prices and investor's enthusiasm increase.

The reverse happens when prices and enthusiasm falls.

But worry not. If you are patient and can sit out any bad patch of liquidity or volatility in the market, you will see it's all part of the market cycle.

But here's the most important thing to remember: This is the perfect environment to pick out those 'crorepati stocks'.

These are individual stocks that go up so many times that they make their investors stinking rich in the process.

The best stocks can be bought at the most lucrative prices when they are being neglected by most investors.

And this is one of those times. Especially as far money multiplying smallcaps are concerned.

Due to the spate of bad news neglect has crept in. Investors are ignoring good fundamentals and many such stocks are available at low levels.

The low competition in such stocks from other investors means you now can scoop them up low and early, before others get on their trail.

This offers you the potential for massive profits.

But how does one pick such stocks?

I've found a formula that could predict the perfect stock, one that has the potential to make crores in the coming years.

In fact, I've set this down in a new guide, Small Caps That Will Race Ahead of the Sensex.

You can get it free if you just click the guide name above. And what's more I will save you a seat - free, of course, in my 'One Stock Crorepati' MEGA summit on 11th February.

I will tell you the three critical characteristics for zeroing in on individual stocks that have what it takes to make one a crorepati.

In fact, because the environment to pick such stocks is so favourable right now, I'll take it one step further and share details of one little-known Indian company - a 'crorepati stock' which has just positioned itself to offer what may be one of the most brilliant opportunities of the decade...

Existing Hidden Treasure subscribers can access the report here. For everyone else - learn more here.

This smallcap stock is poised to create a lot of wealth in for its investors in the years to come... And no budget can stop it from doing so.

I hope you will act today - because as you know with buying stocks, timing is crucial.

Warm regards,

Richa Agarwal
Richa Agarwal
Editor, Hidden Treasure
Equitymaster Agora Research Private Limited (Research Analyst)

PS: To take advantage of the post budget opportunity to build wealth don't miss Richa's One Stock Crorepati mega summit - where she talks about a winning stock that could set you up for huge wealth in 2020.

Copyright © Equitymaster Agora Research Private Limited. All rights reserved.

Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement

Disclosure & Disclaimer: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. The Author does not hold any shares in the company/ies discussed in this document. Equitymaster may hold shares in the company/ies discussed in this document under any of its other services.

This document is confidential and is supplied to you for information purposes only. It should not (directly or indirectly) be reproduced, further distributed to any person or published, in whole or in part, for any purpose whatsoever, without the consent of Equitymaster.

This document is not directed to, or intended for display, downloading, printing, reproducing or for distribution to or use by, any person or entity, who is a citizen or resident or located in any locality, state, country or other jurisdiction, where such distribution, publication, reproduction, availability or use would be contrary to law or regulation or what would subject Equitymaster or its affiliates to any registration or licensing requirement within such jurisdiction. If this document is sent or has reached any individual in such country, especially, USA, Canada or the European Union countries, the same may be ignored.

This document does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Our research recommendations are general in nature and available electronically to all kind of subscribers irrespective of subscribers' investment objectives and financial situation/risk profile. Before acting on any recommendation in this document, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek professional advice. The price and value of the securities referred to in this material and the income from them may go down as well as up, and subscribers may realize losses on any investments. Past performance is not a guide for future performance, future returns are not guaranteed and a loss of original capital may occur. Information herein is believed to be reliable but Equitymaster and its affiliates do not warrant its completeness or accuracy. The views/opinions expressed are our current opinions as of the date appearing in the material and may be subject to change from time to time without notice. This document should not be construed as an offer to sell or solicitation of an offer to buy any security or asset in any jurisdiction. Equitymaster and its affiliates, its directors, analyst and employees will not be responsible for any loss or liability incurred to any person as a consequence of his or any other person on his behalf taking any decisions based on this document.

As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

Equitymaster Agora Research Private Limited (Research Analyst) 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407