The recent downtrend in the stock markets is posing challenges to investors looking for safe returns. The carnage in the market has led to erosion of market capitalisation of even fundamentally strong companies with a consistent financial performance and investor wealth creation track record. We have identified companies, which have a stable dividend payment record and which are trading below their book value. Such stocks offer a safe haven to investors where safety is of greater priority compared to high returns.
# Price/Book Value: A ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest book value per share.
Rating Rationale ICICI direct endeavours to provide objective opinions and recommendations. ICICIdirect assigns ratings to its stocks according to their notional target price vs. current market price and then categorises them as Outperformer, Performer, Hold, and Underperformer. The performance horizon is two years unless specified and the notional target price is defined as the analysts’ valuation for a stock.
Outperformer: 20% or more
Performer: Between 10% and 20%
Hold: +10% return
Underperformer: -10% or more