Skip to main content

Stocks To Buy Now : REC, A Dividend King Company

Hello Guys, welcome to Amazing Adviser. Today I've come with a stock which is in its bad phase and you can consider it to buy for creating wealth. I must mention that this post is totally based on my analysis. Please consult your adviser before investing.

So today's share is REC or Rural Electrification Corporation Limited.

My first reason to choose this company - It is a Navratna Company and it has a support or back up of government. I know most of the people bet on private sector company these days but sometimes it's good to think from other point of view. REC operates in Power Sector and we all know India is a Power Hungry Company. India has more than 130 crore population and there are still many villages in which power has not reached yet.

Most Importantly power sector is a beaten down sector from last two decades. So the best of this sector is yet to come and I'm sure it will come in next decade. With advancement in technology we all need power, electricity and fuel. REC is a dominating company in this field. It basically gives loan to company for setting up infrastructure for Power generation.

This is it's fundamental analysis. Now let's come to technical analysis. I want to show you it's weekly chart.

You can clearly see that this stock is trading in a range from ₹75-₹200 from last 10 years and now it is trading at ₹120. From the chart it is very clear that this stock has a strong support near ₹75. Recently it has touched ₹100 and from there it has rallied up to ₹120. I think this is the best time to include this stock in your portfolio for long term wealth creation. It's my experience that in each budget there is some announcement for power sector and power sector rally before budget. So we can expect price appreciation in short term also.

Further it's EPS is around ₹23.53. If we discount it with 10% for perpetuity then also its value comes around ₹235. So clearly it's an undervalued stock.

Apart from that the most convincing reason to buy this stock is its dividend yield. In FY 2017-18 it has distributed ₹9.15 per share dividend which comes around 7.6% in current price. Bank FD's rate are decreasing. SBI is giving 6.6% interest in FD. So you can invest in this stock and think it as FD. It will give you return like FD interest each year. Adding to that your dividend will be tax free whereas interest in FD are taxable. So why not invest in this stock or I can say multibagger.

That's all for today. Keep visiting this blog for learning and earning.

Thank You

Happy Investing

(Disclosure- I have this stock in my portfolio)


Popular posts from this blog

Success Story Of Colgate, One Of The Bestselling Toothpaste Brand

Success Story Of Colgate, One Of The Bestselling Toothpaste Brand
"It cleans your breath while it cleans your teeth", can you guess whose slogan is this. If you have guessed correct then today I'm going to tell you the success story of one of the best selling toothpaste brands of India i. e. Colgate. It's popularity can be measured by thousands of situations where the term toothpaste is replaced by Colgate in India. Do you know, this brand came into being almost 210 years ago, introduced by Williams Colgate. And initially, this company used to produce soaps, not toothpaste that too in jars and not tubes. So now, let's get back to the beginning of the story. 

Also Read
Success Story Of Haldiram Bujhia
Success Story Of AmulHow Maggie Became Successful?
The founder of Colgate, Willam Colgate was born on 25 Jan 1783 in England. His father was a farmer. 
But later, they shifted to Maryland in the US where his father along with a friend began to make candles and soaps. Unfo…

What is SIP? It's Advantages and Disadvantages

Hello friends, in this post we are going to discuss about SIP, its advantages and most importantly which no one will say you, its disadvantages.

So imagine what we used to do in 90's when we were kids. People had piggybanks but I personally had a small box where I used to put coins whenever I get money. There was a lot of emotions behind that and specially I used to fight whenever anyone touched my box. Imagine how our grand parents were saving money. The -most common sources were
Fixed Deposits(FD)Recurring Deposits(RD)If I will explain the true meaning of SIP then it will be similar to Recurring Deposits. SIP is modern era's RD. So what does SIP do? In SIP a professional invest money in capital markets on behalf of his/her clients. It's as simple as that. It's as simple as planting a small tree. It is as simple as taking care of your small baby.

Advantages of SIP:-

Safe From Market Fluctuation - One of the most important and remarkable advantage of SIP is, it saves yo…

Inspirational Story Of SONY, The Japanease Giant

Hello friends, today I'm going to discuss one of the most popular Japanese Multinational Corporations - Sony. It is such a famous company that people blindly believe its products by its name. And why not? There is hardly any product that would dissatisfy the customers. When it comes to the sound system, Sony stands out of the crowd. 

Also Read
Successful Story Of BMW
Success Story Of Rolls Royace
Success Story Of Jaguar
According to 2016, Sony is the fifth largest television manufacturing company in the world. The whole world of Sony is divided into various groups like Sony pictures, Sony finance services, Sony Mobile etc. Now let's get to know the success story of Sony from the beginning.

The story started with the World War when Ibuka and Morita two men were following their dreams. Ibuka was running a radio repair shop in Tokyo when he met Morita, 13 yrs younger to Ibuka. Then, both of them decided to start a business. And then taking a loan of 500 dollars, they started Tokyo Tele…