2 Sensex Heavyweight Stocks That Are Down In Last 1-Year, Should You Buy?

While the Sensex has given a returns of almost 18.52% in the last 1-year, there are certain stocks that have fallen. This means they have been stark under performers, given the Sensex gains of 18% in the last 1-year. Here are 2 Sensex heavyweight stocks that have fallen in the last 1-year. Should you buy them?

Hindustan Unilever

Stock price as on Jan 21, 2021	Stock price as on Jan 21, 2022
Rs 2408	Rs 2296

If you see the share price of HUL has lost ground, when compared to the Sensex gains of 18% and more. The Sensex was closer to the 50,000 mark on Jan 22, 2021 and is up around 18% since then.

The HUL stock has fallen marginally during the period, thus under performing the indices. Now, when the Sensex rallies and you do not generate returns, that can be frustrating.

Reasons for under performance of the HUL stock and should you buy?

One of the reasons for the under performance of the HUL stock is that margins have been under pressure due to rising input costs. Volumes have also not been great and the FMCG space has been a hard grind with fierce competition. Having said that the company reported a good set of quarterly numbers for the period ending Dec 31, 2021. The standalone net profit for the quarter ended December rose 16.76 per cent year-on-year to Rs 2,243 crore from Rs 1,921 crore in the corresponding quarter last year.

Sanjiv Mehta, Chairman and Managing Director of the company has said that near term operating environment continues to be challenging. With input costs rising, volume growth being tepid, don't expect runaway growth. The stock may at bets generate nominal returns.

HDFC

Stock price as on Jan 21, 2021	Stock price as on Jan 21, 2022
Rs 2587	Rs 2577

This housing finance stock has gone nowhere over the last 1-year. Even some of its subsidiary companies like HDFC Bank, have over the last 1-year not performed great, when compared to peers like ICICI Bank.

We believe that HDFC will move in line with the markets as there is no reason to believe that it would outperform the markets. The stock has generated stupendous returns over the last few decades and to continue to do so, would require a complete boost in earnings, which is unlikely to happen.

Disclaimer

Investing in equities is risky and investors must therefore understand the risk. The author and Greynium Information Technologies Pvt Ltd would not be responsible for any losses caused based on the article. The author and is family do not hold shares in any of the above mentioned companies.