Top Growing Stocks in India for 2024: High-Growth Companies and Sectors to Watch
Investing in growth stocks can be a highly rewarding strategy for long-term investors seeking to capitalise on companies with the potential for substantial financial performance improvement over time. As we look towards 2024, the Indian stock market presents several compelling opportunities in various sectors poised for significant growth. These stocks are typically from companies that reinvest their earnings into expansion, innovation, or acquisitions rather than paying out dividends, making them attractive to those who believe in the company’s future prospects.
For investors in India considering long-term investments for 2024, focusing on growth stocks requires a strategy that combines a keen eye for market dynamics with patience and a tolerance for risk. By investing in these stocks, individuals can effectively bet on the future direction of innovative and expanding industries within one of the world’s most dynamic economies. In this article, we will explore some of the best growth stocks in India for 2024, how to identify them for your portfolio, risks associated with growth stocks, and more.
What are Growth Stocks?
Growth stocks exhibit a growth rate that is much higher than the market’s average growth rate. It shows that the stock grows faster than the market’s average stock, which causes earnings to increase faster. These stocks don’t pay dividends.
Many small-cap stocks are considered fast high growing stocks in India. However, some larger companies may also be growth companies.
Now that we know what is a growth stock, let’s look at some of the top companies that have experienced share growth.
Trending Growth Stocks List in 2024
Here’s a list of best high growth stocks India for 2024. These are the best share to buy for growth and the best growth stocks to buy now in India, potentially:
| Name | Sub-Sector | Market Cap (Rs. in cr.) | Close Price (Rs.) | 5Y Avg Return on Equity (%) | 5Y Historical Revenue Growth (%) | 5Y Historical EPS Growth (%) | 5Y Hist Op. Cash Flow Growth (%) | PE Premium vs Sector (%) | PE Ratio |
|---|---|---|---|---|---|---|---|---|---|
| Ahluwalia Contracts (India) Ltd | Construction & Engineering | 8,012.05 | 1243.2 | 15.48 | 18.29 | 26.15 | 24.6 | -57.61 | 21.38 |
| Man Infraconstruction Ltd | Construction & Engineering | 7,064.88 | 194.79 | 15.5 | 26.98 | 48.36 | 104.17 | -53.36 | 23.52 |
| Mahanagar Gas Ltd | Gas Distribution | 18,228.95 | 1864.7 | 23.03 | 17.65 | 18.49 | 18.02 | -41.59 | 14.28 |
| Utkarsh Small Finance Bank Ltd | Diversified Financials | 5,283.47 | 47.99 | 15.41 | 30.68 | 26.24 | 36.27 | -41.27 | 10.62 |
| Sharda Motor Industries Ltd | Auto Parts | 7,538.06 | 2630.25 | 24.85 | 20.11 | 25.92 | 31.34 | -40.51 | 25.16 |
| Caplin Point Laboratories Ltd | Pharmaceuticals | 15,279.49 | 2014.35 | 25.81 | 21.41 | 20.85 | 32.48 | -34.44 | 33.43 |
| Jindal Stainless Ltd | Iron & Steel | 59,344.93 | 742.45 | 20.68 | 23.28 | 61.8 | 27.7 | -31.09 | 21.87 |
| GMM Pfaudler Ltd | Industrial Machinery | 6,323.01 | 1426.35 | 19.49 | 46.65 | 28.1 | 60.04 | -29.91 | 35.34 |
| eClerx Services Limited | Outsourced services | 13,034.28 | 2755.4 | 23.68 | 15.12 | 21.53 | 20.6 | -28.68 | 25.48 |
| Marksans Pharma Ltd | Pharmaceuticals | 11,708.39 | 263.59 | 20.38 | 17.27 | 29.95 | 53.09 | -26.8 | 37.32 |
Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.
Note: The data in the growth stocks list in India is from 10th September 2024. It is taken from a pre-built screen, ‘Growth Bargains’ from the Tickertape Stock Screener.
Why Invest in Growth Stocks?
The fastest growing share in India today may provide you with higher capital growth as compared to any other type of stock. These businesses grow at a pace that is much faster than the industry average. Thus, investing in growth companies can increase the value of your money over the long and short terms. Given optimal market circumstances and price rise over the long run, your money may even double with further compounding.
Your money may outperform inflation by investing in the best growth stocks India. Thus, according to financial experts, the true growth of your money is the growth rate minus inflation.
However, investors should always be mindful of their investment goals and risk appetite before purchasing any high growth stocks India; thorough research of the market conditions and stock performance would always help them gain financial freedom.
Top Trending Growth Stocks in India
Here is an overview of the top 10 fastest growing stocks in India. These are some of the fastest-growing stocks in India.
Ahluwalia Contracts (India) Ltd
Founded in 1979, Ahluwalia Contracts (India) Ltd is one of India’s leading construction and engineering companies, specialising in civil engineering, construction, and infrastructure development. The company has executed various large-scale projects across the country, including commercial, residential, institutional, and industrial buildings. It is the fast growing company in India as per the criteria selected above. Please consult a professional before investing.
Ahluwalia Contracts (India) Ltd has a market capitalisation of Rs. 8,012.05 cr., with a closing price of Rs. 1243.20. Over the past five years, the company has averaged a return on equity of 15.48% and a historical revenue growth of 18.29%. The company’s historical EPS growth rate over the last five years is 26.15%, and its operational cash flow growth rate stands at 24.60%. The PE Premium vs. Sector is -57.61%, with a PE ratio of 21.38.
Man Infraconstruction Ltd
Man Infraconstruction Ltd, founded in 2002, is a leading construction and real estate development company in India, known for its expertise in port infrastructure, residential, industrial, and commercial projects. The company has a strong presence in the construction sector, focusing on quality and timely delivery.
With a market capitalisation of Rs. 7,064.88 cr., the company’s stock closed at Rs. 194.79. It has a five-year average return on equity of 15.50%, historical revenue growth of 26.98%, and a robust historical EPS growth rate of 48.36%. Its operating cash flow growth over the last five years is 104.17%. The company trades at a PE Premium vs. Sector of -53.36%, with a PE ratio of 23.52.
Mahanagar Gas Ltd
Incorporated in 1995, Mahanagar Gas Ltd is one of the leading natural gas distribution companies in India, supplying Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) to various sectors. It is known for its extensive network and focus on providing clean energy solutions.
Mahanagar Gas Ltd has a market capitalisation of Rs. 18,228.95 cr., and its stock closed at Rs. 1864.70. It boasts a five-year average return on equity of 23.03%, historical revenue growth of 17.65%, and an EPS growth rate of 18.49%. The operational cash flow growth over the past five years is 18.02%. The PE Premium vs. Sector stands at -41.59%, and the PE ratio is 14.28.
Utkarsh Small Finance Bank Ltd
Utkarsh Small Finance Bank Ltd was established in 2016 and offers a range of banking and financial services, focusing on microfinance, SME loans, and retail banking. The bank serves underbanked and underserved communities in India.
The bank has a market capitalisation of Rs. 5,283.47 cr. and a closing price of Rs. 47.99. Over the past five years, it has recorded a return on equity of 15.41%, historical revenue growth of 30.68%, and EPS growth of 26.24%. The operating cash flow growth rate for the same period is 36.27%. It trades at a PE Premium vs. Sector of -41.27%, with a PE ratio of 10.62.
Sharda Motor Industries Ltd
Founded in 1986, Sharda Motor Industries Ltd is a leading manufacturer of automotive components, including exhaust systems, suspension systems, and seating structures. The company caters to major automotive OEMs in India and globally.
Sharda Motor Industries Ltd has a market capitalisation of Rs. 7,538.06 cr., with a closing price of Rs. 2630.25. It has a five-year average return on equity of 24.85%, historical revenue growth of 20.11%, and an EPS growth rate of 25.92%. The company’s historical operating cash flow growth rate over the past five years is 31.34%. It trades at a PE Premium vs. Sector of -40.51%, with a PE ratio of 25.16.
Caplin Point Laboratories Ltd
Established in 1990, Caplin Point Laboratories Ltd is a pharmaceutical company that develops, manufactures, and markets a range of generic formulations and pharmaceutical ingredients. The company has a strong presence in emerging markets like Latin America and Africa.
Caplin Point Laboratories Ltd has a market capitalisation of Rs. 15,279.49 cr., with a closing price of Rs. 2014.35. The company’s five-year average return on equity is 25.81%, historical revenue growth is 21.41%, and EPS growth rate stands at 20.85%. The operational cash flow growth rate over the past five years is 32.48%. The PE Premium vs. Sector is -34.44%, and the PE ratio is 33.43.
Jindal Stainless Ltd
Founded in 1970, Jindal Stainless Ltd is India’s largest stainless steel manufacturer, producing a wide range of stainless steel products for industrial and consumer applications. The company is known for its integrated manufacturing facilities and strong domestic and international market presence.
Jindal Stainless Ltd has a market capitalisation of Rs. 59,344.93 cr., and its stock closed at Rs. 742.45. The company’s five-year average return on equity is 20.68%, historical revenue growth is 23.28%, and EPS growth rate is 61.80%. It has a historical operating cash flow growth rate of 27.70%. The PE Premium vs. Sector is -31.09%, with a PE ratio of 21.87.
GMM Pfaudler Ltd
GMM Pfaudler Ltd, founded in 1962, is a leading supplier of engineered equipment and systems for critical applications in the chemical and pharmaceutical industries. The company specialises in manufacturing glass-lined equipment, which is essential for safe chemical processing.
The company has a market capitalisation of Rs. 6,323.01 cr. and a closing price of Rs. 1426.35. It has a five-year average return on equity of 19.49%, historical revenue growth of 46.65%, and an EPS growth rate of 28.10%. The operating cash flow growth rate over the past five years is 60.04%. It trades at a PE Premium vs. Sector of -29.91%, with a PE ratio of 35.34.
eClerx Services Limited
Founded in 2000, eClerx Services Limited provides business process management, automation, and analytics solutions to Fortune 500 companies. The company operates in key sectors, including financial services, cable and telecom, and retail.
eClerx Services Limited has a market capitalisation of Rs. 13,034.28 cr., and its stock closed at Rs. 2755.40. The company’s five-year average return on equity is 23.68%, historical revenue growth is 15.12%, and EPS growth rate stands at 21.53%. The operational cash flow growth rate over the past five years is 20.60%. The PE Premium vs. Sector is -28.68%, with a PE ratio of 25.48.
Marksans Pharma Ltd
Marksans Pharma Ltd was established in 1992 and specialises in the research, development, manufacturing, and marketing of pharmaceutical formulations. The company has a global presence, supplying products to the US, UK, Europe, and other international markets.
Marksans Pharma Ltd has a market capitalisation of Rs. 11,708.39 cr., with a closing price of Rs. 263.59. It has a five-year average return on equity of 20.38%, historical revenue growth of 17.27%, and an EPS growth rate of 29.95%. The company’s operating cash flow growth over the past five years is 53.09%. The PE Premium vs. Sector stands at -26.80%, with a PE ratio of 37.32.
Investing in High Growth Stocks India via smallcase
You can also invest in a basket of high-growth stocks in India via smallcase. Simply go to smallcase.com or the smallcase app, and log in using your phone number. Then, go to ‘Discover‘ and click on ‘All smallcases‘. There you can filter the smallcases based on ‘investment strategy’ by selecting ‘growth’. You’ll find an array of stock portfolios that are based on the growth investing strategy. Thus, just pick the fastest growing company in India that fit your investment criterion.
Make sure that you do your diligent research before picking the best growth stocks for the next 10 years in India, keeping in mind your long-term investment goals and risk appetite.
How to Invest in Growth Stocks?
Top growing stocks in India can be valuable to any investment portfolio, providing diversification and potential returns.
One way to invest in growth shares in India is through traditional stock market investing. Therefore, this involves researching individual companies and buying shares of stock directly.
Another way to invest is via exchange-traded funds (ETFs). Investors can choose from various growth-oriented ETFs, which provide exposure to a diversified portfolio of growth companies.
Mutual funds are another option for investing in growth shares. These are professionally managed investment portfolios that pool money from multiple investors to buy a diversified portfolio of stocks. Like ETFs, there are a variety of mutual funds that focus on growth investing.
However, if you’re confused about which stocks to pick, you can explore smallcases:
- smallcases are readymade portfolios of stocks/ETFs, that are based on a theme idea or strategy
- They’re created and managed by SEBI-registered experts
- smallcase.com offers over 200+ stock portfolios, created by 180+ managers
- Some of the popular smallcases among new investors are as follows:
Disclosures for aforementioned smallcases
How to Identify Growth Shares?
You can easily identify the best future stocks in the growth industry by following these factors.
- High Growth Potential: Look for companies that have a history of high revenue and earnings growth.
- Strong Market Position: Identify companies that have a dominant position in their industry and a strong competitive advantage.
- Innovative Products/Services: Look for companies that have a pipeline of innovative products or services that have the potential to disrupt their industry.
- Experienced Management Team: Companies with experienced and competent management teams are better positioned to navigate market challenges and drive growth.
- Large and Expanding Market Opportunity: Identify the best growth stocks for the next 10 years in India by researching the companies operating in markets with significant potential for growth.
What are the Various Features of Fast Growing Shares?
Some of the features of the best stocks in the industry have been listed below:
- Risky Investment: Growth stocks have a higher potential for future returns, but they also carry a higher risk than other investing categories like value stocks or corporate bonds. The primary threat is that the actual or anticipated growth won’t carry over into the future.
- High P/E Ratio: Any sector or industry may have growth stocks, which often trade at a high price-to-earnings (P/E) ratio. Thus, they might not be making money right now, but they might.
- P/E ratio = market value per share / earnings per share
- High PEG Ratio: Price earnings to growth ratio is a ratio that is taken into consideration to evaluate a growth stock. The key benefit of PEG ratio over P/E ratio is that it accounts for the annual increase in the overall profits per share of a company. A high PEG ratio suggests that a company has performed very well.
- High RoE: Companies in India that raise money through high growth stocks India often have a record annual return on total equity. The higher the RoE, the more valued growth stocks.
Who Should Invest in Growth Stocks?
Risk-Takers
Investing in high growth stocks in India is tailored for individuals who are inclined towards risk and seek substantial returns on their overall investment. These stocks, often seen among the fastest growing companies in India, are characterised by their potential for significant capital appreciation, making them suitable for those comfortable with volatility in pursuit of higher rewards. Investors looking for the best future stocks in India can find opportunities in these dynamic markets.
Long-Term Investors
Ideal candidates for growth stock investment are investors who prioritise long-term stock wealth accumulation over immediate income generation. Since high growth stocks in India often reinvest profits into the company rather than distributing dividends, they align with the objectives of individuals seeking wealth appreciation through capital gains. This approach is particularly appealing when investing in a fast-growing company in India that shows promise for future growth.
Investors Interested in Strong Fundamentals
Those with a keen interest in company analysis and market trends can identify the top growing companies in India and their issuing entities. Understanding the factors that contribute to a growth company’s potential empowers investors to make informed decisions in this dynamic and often unpredictable segment of the stock market. Identifying emerging stocks in India or pinpointing which share grows in the future requires a deep dive into market performance and company fundamentals.
Therefore, for individuals willing to weather market fluctuations in exchange for the potential of substantial returns, growth stocks can be a strategic addition to their investment portfolio. Investing in the top 10 high growth stocks in India or seeking out the best growing shares in India offers a pathway to capitalise on some of the most growing shares with highest growth stocks potential. Whether it’s the fastest growing shares in India or the best growing company in India, growth stocks represent a vital component for those focusing on the long term.
What are the Alternate Options for Growth Stocks?
Growth stocks are highly volatile and are only meant for people with a high-risk appetite. Investors who don’t see growth stocks fit in their portfolio can look at value stocks.
Shares of companies that are trading at a discount are known as value stocks. Value stocks often have strong dividend payout ratios and the price of the stocks is typically lower compared to other stock categories since they are undervalued.
What are the Risks of Investing in Growth Stocks?
Let’s have a look at the potential risks of future stocks to invest in the growth industry.
- Volatility and risk of price fluctuations due to market conditions and changes in investor sentiment
- Dependence on market conditions that can affect the company’s growth potential
- Possibility of market saturation as competition increases and growth slows down
- Risk of overvaluation, where the company’s stock price becomes detached from its fundamentals
What are the Advantages of Investing in High Growth Stocks?
Here is a list of advantages of investing in the best future stocks of the growth industry.
- Potential for high returns on investment as a result of the company’s strong growth trajectory
- Diversification of portfolio with exposure to different industries and sectors
- Protection against inflation as the company’s earnings grow over time
- Long-term growth potential for sustained returns
How to Build a Growth-Oriented Investment Portfolio?
- Fundamental analysis to evaluate the company’s financial health, management, and competitive advantage.
- Technical analysis to identify trends and patterns in the company’s stock price
- Growth investing strategies that focus on high-growth companies with a long-term perspective
- Value investing strategies that focus on undervalued companies with strong fundamentals
However, investors must do their own research and/or consult their financial advisor before investing.
To Wrap It Up…
In conclusion, investing in growth stocks can be a lucrative strategy for investors looking to maximize their returns over the long term. Therefore, with the right research and strategy, investors can potentially capitalize on the growing share price of these high growth stocks in India.
FAQs About the Growth Stocks in India
The following are the fastest growing stocks in India 2024. These are the best shares to buy for long term in India are:
1. Ahluwalia Contracts (India) Ltd
2. Man Infraconstruction Ltd
3. Mahanagar Gas Ltd
Note: This list is for educational purposes only and is not recommendatory
You can invest in a basket of high-growth stocks in India via smallcase. Simply go to smallcase.com or the smallcase app, and log in via your phone number. Then, go to ‘Discover‘ and click on ‘All smallcases‘. Filter the smallcases based on ‘investment strategy’ by selecting ‘growth’.
Evaluating each stock individually and carefully assessing valuations is essential. Many growth stocks have rebounded strongly this year, exceeding expectations, but investors must remain cautious and select the best stocks for their portfolios.
Investing in growth stocks can suit investors seeking faster wealth growth but comes with higher risk. It’s important to assess your investment goals and risk tolerance before choosing the best long-term shares.
Growth stocks offer the potential for high returns, mainly through long-term capital gains, but returns are not guaranteed. Investors should assess both opportunities and risks before investing in top growth stocks for the next decade in India.
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