Is Bhansali Engineering Polymers Limited a Multi-Bagger Stock?
Bhansali Engineering Polymers has emerged as a highly talked-about stock in recent times. The company was initially recommended at Rs. 40 and has seen a remarkable rise to reach a high of Rs. 210 just before the release of its recent quarterly results. The exceptional return is as high as 425%, demonstrating the significant growth potential of this stock. However, is Bhansali Engineering Polymers now a multi-bagger stock, or is it time to consider exits?
Achieved Milestone: The stock’s current valuation has already factored in even the FY19 earnings at 20-25x, indicating that it has priced in the anticipated growth quite efficiently. As a result, it is advised to consider exiting the stock around Rs. 200 or above, as the company is no longer being considered as fundamentally cheap enough to deliver multi-bagger returns.
Future Prospects and Recommendation
Based on current trends and expectations, the stock is likely to trade within the range of Rs. 160 to Rs. 200 for the next 6 to 9 months. This range is applicable unless a blockbuster result is achieved in the upcoming quarters, which would potentially push the stock higher. In the absence of such positive news, strong technical breaks above Rs. 200 are necessary for the stock to continue its upward trajectory.
It is important to note that the current valuation makes Bhansali Engineering Polymers no longer a fundamentally cheap investment option to be considered a multi-bagger. As such, one must carefully evaluate the potential rewards against the current valuation and risk tolerance.
Alternative Investment Options
If you are seeking fundamentally cheaper chemical stocks that can deliver strong returns on positive results, there are several options available. Consider investing in Thirumalai Chemicals, IG Petro, and Indo Borax. These companies have demonstrated consistent growth and strong fundamentals, making them appealing to value investors who are looking for reliable returns on investment.
Thirumalai Chemicals is particularly noted for its robust offerings in the retail and industrial sectors, while IG Petro and Indo Borax have shown resilience and potential for future growth. These stocks provide diversification away from Bhansali Engineering Polymers and could potentially offer better returns based on evolving market conditions.
Conclusion
Bhansali Engineering Polymers Limited has undeniably demonstrated strong growth and potential, but its current valuation already factors in significant future earnings. For those looking for a multi-bagger stock, it may be time to reassess and consider other fundamentally cheaper chemical stocks. Understanding the current market conditions and evaluating alternative investment options is crucial for making informed decisions in the stock market.