MRF share price hits Rs 80,000 for first time ever; these investors made a killing, can you too?

Stock market is all about patience, and if you have that, sky is the limit. Who else to tell you that better than those who actually benefited from it. In retrospect, while we see many stocks generating staggering returns over a long haul, how many of us actually hold these multibagger stocks that long? Not many! But these two investors did! Their fortune-making story is worth paying a heed to. Both stories involve the same stock that has risen a whopping 15,858 per cent since its August 2001 price level of Rs 500. The stock hit its lifetime high of Rs 80,000 in Tuesday's trade, and settled at Rs 79,796 on the BSE. The stock is of course MRF, the most expensive stock on Dalal Street in terms of share price. Going by analysts' view, the stock may soon touch the six-figure mark of Rs 100,000.

Let's meet the two investors whose patience resulted into dream returns, and how! Ravi Jain from Delhi on Monday told Zee Business that he holds 10,000 shares of MRF that his grandfather bought in 1990 at Rs 9000-odd levels. The amount of returns that Jain received are breath-taking. This viewer of Zee Business is sitting on a profit of a massive Rs 67 crore on just Rs 9 crore investment! Earlier, Jain had said that his grandfather bought 20,000 shares of MRF in 1990, which were in the dematerialised form, which he later transferred into a d-mat account. 

Bumper Investor Dials Back to Zee Business to Seek Advise on Investments.@AnilSinghviZEE @mihirzee @poojat_0211 pic.twitter.com/foGHihTT7D

— Zee Business (@ZeeBusiness) April 17, 2018

JS Bedi, another viewer from Delhi told Zee Business that he bought 10 shares of MRF at Rs 1200 a decade ago. His meagre investment of Rs 12,000 10 years ago have turned into Rs 798,000, a whopping return of 6,550 per cent against Tuesday's closing price. 

देखिए 10 सालों में कुछ हज़ार रुपयों में खरीदे शेयरों ने @ZeeBusiness के इस दर्शक को कैसे बनाया करोड़पति @mihirzee @AnilSinghviZEE @poojat_0211 pic.twitter.com/UJ5FOoW5Kb

— Zee Business (@ZeeBusiness) April 12, 2018

They have made a massive profit, but the big question is whether you too should board the MRF bus? 

Well, to cut to the chase, you better do so because analysts still see huge gains on the stock as the company is rich on fundamentals and is run by an efficient management. 

"There still remains wealth creation opportunity on MRF as fundamentals and business dynamics of the company is superb. The stock can rise up to Rs 1 lakh in next two-three years," told Avinash Gorakssakar, HoR, Joindre Capital to Zee Business. 

Gaurang Shah of Geojit Financial Services also believes the stock will hit the six-figure mark as the company has an impressive balance sheet, an excellent management, their own rubber plants, and credible governance. 

"There is no reason to sell MRF stock. One should give it to the next generation, telling them to pass it on to another," Shah told Zee Business. 

At present, MRF share price is trading at twelve-months price-to-equity ratio (P/E) of 22.32 times, which is lower than the industry PE of 23.15 times. The company's earnings per share (EPS) is at Rs 3504.29, which is way higher than its peers like Apollo Tyre – whose EPS is at mere Rs 12.27, CEAT at Rs 56.04 and JK Tyre at negative Rs 0.29 per share.