It's been been a long time since I started investing in stocks. I had always wanted to publish my analysis in a blog but never had it in a presentable form. Thought about it today, wanted to do a lot of analysis and then came up with a write up but never got much time. Finally, settled with the Infosys story.
Infosys - a blue chip stock I admired as a teen. The stock is said to be a standing testimony to long term investing. The dividends were huge then with a lot of special dividends which was rewarding enough. The only other stock where I saw a lot of value unlocking was Reliance.
Infosys came up with an IPO in the month of February 1993 with an offer price of Rs. 95. A stock that was undersubscribed by the Indian public went on to list successfully with the help of confident institutional bankers. Today after a lot of bonus issues and a stock split in Jan 2000 where the face value came to Rs.5 from Rs. 10, the original stock is worth 128 shares. What amazes me is the pace of growth the company had in all these years. The stock closed at a price of Rs. 2771 on Friday. This translates the value of the original share to Rs. 3,54,771. I cannot use the term multi bagger since that would be an understatement for the stock had multiplied many times than anyone could have ever thought then - 3734 X. Amazing!
In 1993, people never recognized Infosys nor were able to understand the business it was in to. As the years progressed, computing and technology became popular and with the Y2K problem in to the millennium, technology companies were hot picks. Infosys was a much recognized company in the year 2000. Perhaps, an investment then would have costed Rs. 940 a share but would have gone to Rs. 44,346 (based on the Friday closing price). Value multiplied by 47 X. After all, money invested in any other instrument would have only multiplied by 2/3 X in a period of ten years. This should certainly instill a lot of confidence amongst long term investors!
Disclaimer:
This information does not guide any one to invest in the stock but is just an analysis of the stock over the years. Anyone who invests does so at their own risk. Also, the author will not be be held responsible for the accuracy of the information. Please refer to the Infosys website for more accurate information.
Infosys - a blue chip stock I admired as a teen. The stock is said to be a standing testimony to long term investing. The dividends were huge then with a lot of special dividends which was rewarding enough. The only other stock where I saw a lot of value unlocking was Reliance.
Infosys came up with an IPO in the month of February 1993 with an offer price of Rs. 95. A stock that was undersubscribed by the Indian public went on to list successfully with the help of confident institutional bankers. Today after a lot of bonus issues and a stock split in Jan 2000 where the face value came to Rs.5 from Rs. 10, the original stock is worth 128 shares. What amazes me is the pace of growth the company had in all these years. The stock closed at a price of Rs. 2771 on Friday. This translates the value of the original share to Rs. 3,54,771. I cannot use the term multi bagger since that would be an understatement for the stock had multiplied many times than anyone could have ever thought then - 3734 X. Amazing!
In 1993, people never recognized Infosys nor were able to understand the business it was in to. As the years progressed, computing and technology became popular and with the Y2K problem in to the millennium, technology companies were hot picks. Infosys was a much recognized company in the year 2000. Perhaps, an investment then would have costed Rs. 940 a share but would have gone to Rs. 44,346 (based on the Friday closing price). Value multiplied by 47 X. After all, money invested in any other instrument would have only multiplied by 2/3 X in a period of ten years. This should certainly instill a lot of confidence amongst long term investors!
Disclaimer:
This information does not guide any one to invest in the stock but is just an analysis of the stock over the years. Anyone who invests does so at their own risk. Also, the author will not be be held responsible for the accuracy of the information. Please refer to the Infosys website for more accurate information.
I Like the disclaimer... very smart move indeed :P
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