“Technology is central to Development. It touches one and all, and is an important instrument of our national progress.”
Narendra Modi
Back on March 28, 2024, I published an article entitled “Three Breakout Stocks to Play India’s Growth Machine” https://www.outsiderclub.com/indian-stocks/
I wrote: “One of the major investment themes for 2024 is the global decoupling from China. And perhaps the biggest winner is India.
India has many positives. They have a middle class that includes roughly 300 million people. They also have the rare benefit of a growing working-age population. In terms of population pyramid India has it going on. Half of Indians are under the age of 25. By 2030 one-fifth of the working-age people in the world, those between 18 and 64, will be Indian.
Furthermore, India’s stock market just surpassed Hong Kong as the fourth largest in the world and the latest GDP growth number came in at 7.3%.
The economy is booming with strong government and consumer spending as well as a robust service sector. The government of Prime Minister Modi is pro-business and has ramped up its spending on infrastructure. Furthermore, foreign businesses are dumping more cash into the country to build factories, especially in tech.”
According to the Financial Times: Under Modi, GDP has increased by an average of 5.6% a year. Moreover, abject poverty has fallen from 18.7% in 2015 to 12% in 2021 mostly due to signing up 500 million people for biometric bank cards which allows them to receive welfare directly and cuts out the graft of middlemen.
The infant mortality rate is dropping rapidly and the middle class is the fastest growing segment of the population. The Modi government is also spending a lot on infrastructure such as railways, roads, and power grids, and hooking everyone up to the internet.
Needless to say, he is very popular and was reelected about a month ago. The Indian bullish story continues.
I just found this company today, HPL Electric & Power (HPL.BO) is up 625% in the last three years with most of that jump happening in just the last 15 months.
These guys make switches, meters, adapters, distribution boards, and about a thousand other dodads that have to do with building out the electric grid. This is a dominant trend that Brit Ryle has been writing about for a few months. AI and EVs will double electric demand in the next few years you should believe him. Companies like HPL will benefit.
https://www.outsiderclub.com/buy-electricity-stocks-now/
Back on March 28, I told you about three similar stocks. Let’s see how they did.
Time Technoplast Limited (TIMETECHNO.BO)
On March 29, Time Technoplast was trading at 252 INR (Indian Rupee) a share. Today they are trading at 333 INR. That’s a 32% gain in about two and a half months.
The company makes and sells technology-based polymer and composite products in India and internationally. It’s kinda like the Rubbermaid of India. They also make products for industry such as barrels and bins. As the consumer moves up he will buy more stuff.
Time Technoplast has a price-to-earnings ratio of 240, and grew earnings by 45% last quarter. That gives it a PEG ratio of just 0.53.
Torrent Power Limited (TORNTPOWER.NS) was trading at 1,408 INR (Indian Rupee on March 29, 2024. It is now trading at 1,509 INR. That’s a 7% gain, not great but the stock is consolidating while in an uptrend and is looking to break-out to the upside.
It’s an electric company. The company owns thermal power plants with a generation capacity of 3,092 megawatts; and renewable power plants with a generation capacity of 1,804 megawatts.
Torrent Power has a price-to-earnings ratio of 39 and quarterly revenue growth of 8%. Earnings did decline by 4% last quarter but they’re still trending higher.
Triveni Turbine Limited (TRITURBINE.BO)
Triveni Turbine was trading at 550 INR (Indian Rupee) when I recommended it. It is now trading at 617 INR. That’s a gain of 12%.
Triveni Turbine makes power-generating equipment in India. The company offers back-pressure and condensing steam turbines for a range of pressure and flow applications; American Petroleum Institute (API) compliant steam turbines; and sustainable modularly arranged pressure-reducing turbines, as well as spare parts.
They have a price-to-earnings ratio of 70 and a quarterly revenue growth of 36.2%. That gives them a PEG ratio of 1.93 which is a little bit high. But they are in a hot market segment and the order book has been seeing increases.
So, we are three for three, we have some nice average gains in a short timeframe, and we are holding for more.
All the best,
Christian DeHaemer
Senior Investment Analyst, Outsider Club
Other India Stocks Trading at Value Prices:
1) TransIndia Real Estate
2) Fusion Microfin
3) Vindhya Telelinks
4) Repco Home Finance
5) Jindal Photo
6) Mishtann Foods
7) Dalmia Bharat
8) Prakash Industries
9) Den Networks
10) Delta Corp
Why cheap energy is good: https://www.outsiderclub.com/cheap-energy-matters/
Brit’s fantastic take on Nvidia: https://www.outsiderclub.com/selling-nvidia/
