My 3 Best Stocks to Buy in 2021 | The Motley Fool

Stock markets were quite volatile in 2020 and have been full of upheavals in 2021 as well. The top-performing equities among the top 100 have outperformed the index by a wide margin. In the year 2020, when the COVID-19 pandemic wreaked havoc on our lives, the stock markets remained mainly optimistic. While the best-performing stocks have increased by almost 500%, the Nifty 100 rose by 13% by the end of 2020 and 28% by October 2021.

2020 began with a massive sell-off in the broader market and ended with the indices reaching new all-time highs. BSE IT and Healthcare indices outperformed the market by roughly 57% and 61% in 2020, and these sectors have grown in 2021. Hence, this is the right time to open a trading account to invest in stocks to gain profits and build wealth.

If you are someone is deciding on which stocks to buy, listed below are the best-performing sectors of 2020, which have more or less maintained their successful run in 2021:

Sector wise performance – Indian stock market

IT Sector –  The pandemic boosted the adoption of digital technology, which is a good news for the IT industry. Deals worth millions of dollars have been won by IT companies, boosting profit margins in 2021. IT businesses now have a majority of their workers working from home because of the COVID-19-related lockdown. As a result, while companies’ profits have increased, its overhead costs have reduced. Among the best IT stocks are Happiest Mind Technologies, Tata Elxsi, and TCS.

Finance Sector – Yes, despite the difficulties, the banking sector was bullish in 2020 and even in 2021 it performed well. Consider investing in private banks instead of public sector (or PSU) banks as although public sector banks account for the majority of credit (70% of loans), private banks can expand their credit portfolio. HDFC Bank, Bajaj Finance and ICICI Bank are some of the financial sector’s jewels.

Healthcare – In 2020, healthcare was one of the most prosperous industries. It grew even more in 2021 as demand for life-saving drugs and immunity-boosting supplements increased. Recently, people have been more interested in purchasing healthcare products. The growth of Dr. Reddy’s, Cipla, Sun Pharma and Aurobindo Pharma have been impressive.

Infrastructure – Despite the country’s economic difficulties, the Indian government continues to invest in infrastructure, including expressways, railway lines and freight corridors. Due to this significant boost to public infrastructure and construction, investors can expect high returns even beyond 2021, from infrastructure-related businesses with a good track record and a healthy order book. The top infrastructure stocks include Adani Port and SEZ, DilipBuildcon and GMR Infra.

Automobile – Despite its current difficulties, this sector saw a comparatively brighter future in 2021 because of the government’s increased investment in public infrastructure and the cyclical pattern (high and low every 4 to 5 years) unique to this sector. In addition, the introduction of electric vehicles on Indian roads is likely to boost car production in the next decade. Tata Motors, Maruti Suzuki and Motherson Sumi all have bright futures in the electric vehicle market.

Highest Return Stocks In India

  • Adani Green Energy: 1-year return: 522%
  • Divi’s Laboratories:1-year return: 103%
  • L&T Infotech: 1-year return: 107%
  • Aurobindo Pharma: 1-year return: 99%
  • Tata Consumer: 1-year return: 88%

Investing in the stock market today

In the years 2020 and 2021, the stock market expanded by leaps and bounds.India has a bright future ahead of it, with much greater growth opportunities. So, start making stock market investment decisions after consulting a financial advisor today and stock market investment according to your goals and risk tolerance.

By Richard