Pharma, fin, auto stocks give consistent returns in 20 yrs

Pharmaceuticals, financials, consumer, auto and auto ancillary companies have consistently given high equity returns to the investors while sharp out performance has been observed in shares of small and mid-size businesses, during the last 20 years, says a report.
According to financial services firm Centrum, some of the long-term outperformers have been Sun Pharma, HDFC Bank, Dr Reddy's, Hero MotoCorp, Britannia, Apollo Hospitals, Shree Cement, Kotak Mahindra Bank, IndusInd Bank, LIC Housing Finance, Supreme Industries and Eicher Motors.
"Some sectors have consistently brought good cheer to their investors over the last 20 years. Pharma, financials, consumer, auto and auto ancillary stories have mostly not disappointed the market and have managed to generate good returns, year after year," the report said.

"These have been most consistent performers and have neither given outsized returns in any period nor have they seen sharp under performance in any period," it added.
Going by data compiled by Centrum for Sensex, the 30-share index has generated a return of 7.55 per cent since 2011. It had given negative returns of 1.64 per cent to investors during the period 1996-2001, following which it had generated 25.37 per cent and 12 per cent returns in 2001-2006 and 2006-2011, respectively.
Similarly, Nifty has given an equity return of 8.05 per cent till July 1, since 2011. The index had given 23.23 per cent returns in 2001-2006, after giving negative returns for the previous five year period (1996-2001). Further, it had generated returns of about 12.4 per cent in 2006-2011.

Centrum also noted that sharp out performance in the last 20 years has always comes from small, mid-sized and upcoming businesses.

"While equity is a long-term return giving asset class, stock selection is very important and one cannot necessarily keep holding the same shares," the report said.
"Stars of yesteryear usually do give up their sheen and make way for rising stars," it added.
The report has taken into account 12 months beginning July 1 to June 30 for a given year. The data has been collected till July 1, 2016. It takes into account stocks are/were part of the S&P BSE 500 index.