Multibagger stock: Investing in a stock is like investing in a business. Any business gives you profit in the long run. Similarly, stock investors are also advised to stay in their investments for a long time keeping their short term sentiments under control. But while choosing the stock, bet on such stocks which have good business model and strong fundamentals.
The biggest mantra to make money in the stock market is to choose good stocks, place bets and stay invested for a long time. In long term investment, you get the benefit of compounding which can make you rich. To understand the benefits of long term investment, let us have a look at the share of Balkrishna Industries. In the last 13 years, the shares of this multinational tire maker have increased from Rs 12.18 to Rs 2000 per share. The stock has gained 16320 per cent in this 13-year period.
Share Price History of Balkrishna Industries
This stock has been under selling pressure since last 6 months. In the last 6 months, it has declined by 20 percent, while in the year 2022 so far this stock has come down from Rs.2327 to Rs.2000 i.e. in 2022, so far this stock has broken about 14 percent. On the other hand, if you look at the journey of the last 1 year, then it has increased from ₹ 1640 to ₹ 2000. During this period, this stock has seen a gain of about 22 percent.
In the same 5 years, this multibagger stock has increased from ₹ 700 to ₹ 2000, that is, it has increased by about 185 percent in 5 years, while in the last 10 years this stock has increased from ₹ 125 to ₹ 2000. It has seen an increase of about 1500 percent in the last 10 years. At the same time, in the last 13 years, this stock has come down from ₹ 12.18 to ₹ 2000, that is, it has run 164 times in the last 13 years.
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impact on investment
Now look at this journey of the shares of Balkrishna Industries, if an investor had put Rs 1 lakh in this stock 6 months ago, then today his Rs 1 lakh would have come down to Rs 80,000, whereas if someone had invested in this stock 1 year ago. Had he kept putting in Rs 1 lakh, he would have been getting Rs 1.22 lakh today. On the other hand, if someone had been putting Rs 1 lakh in this stock 5 years ago, then today he would have been getting Rs 2.85 lakh. On the other hand, if someone had been putting Rs 1 lakh in this stock 10 years ago, then today he would have been getting Rs 16 lakh.
Similarly, if someone had been putting Rs 1 lakh in this stock 13 years ago, he would have been getting Rs 1.64 crore today.
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