Best Long Term Stocks in the current Bear Market

Posted by admin in Alerts, Featured Articles on May 24th, 2010 | one response

Here is a compilation of stocks that have very low downward risk in the current volatile and week looking bear market but has the potential to reap very good returns if the market stability were to return. These stocks are available at attractive valuations and hold the potential to reward investors once the market sentiment turns positive.

We have mainly five types of companies here.

Large brand driven FMCG businesses with large cash generating capacities.
Companies commanding almost monopolistic leadership in their respective industries.
Companies that have recently completed major capex and are going to reap its benefits in FY11.
Companies that have seen their business models evolve into becoming more robust also figure in the list.
Companies that have taken a disproportionately bigger hit in the weak market and are now available at attractive valuation compared to their peers.

Brand driven businesses:

Nestle India
ITC Ltd
Dabur India
GSK Consumer Healthcare
GlaxoSmithKline Pharma

Monopolistic Business Model:

Asian Paints
GAIL
Crisil
Container Corporation of India
Bosch Ltd

Completed Capex (and ready to reap huge revenues the coming quarters)

Petronet LNG
Cipla
JSW Energy
Mahindra Lifespaces
Anant Raj Industries

Changing business model:

Shoppers Stop
Alok Industries

Changed valuations

Reliance Communications
JK Lakshmi Cement

One of the key assumptions that have gone in preparing this list is that the current debt crisis in the Europe can be contained and tackled reasonably within the next few weeks. No stock market investments will remain safe if the crisis blows out of proportions into what we saw in 2008.

Source: http://economictimes.indiatimes.com