Penny stocks, though everyone knows that quality companies will deliver the good returns, but some investors shows the interest towards penny stocks as they will deliver multifold returns in a very short time it it hits, else they may also causes to lose your money.
Everyone thought that below 10 rs stocks are the penny stocks, but we feel that the turnaround stocks which are coming back from their worst face. Before picking penny sstocks we have to work a lot to find out such kind of stocks, there would be several parameters to filter the stocks.
However always remember that investing into penny stocks will be always a risky investment, we should allocate small capital for these stocks which never impacts our financial position even we lost. Here we discuss somewhat fundamentally good penny stocks trading around 50 rs.
What are Penny Stocks?
As per the current markets, the penny stocks are the low priced stocks which are trading below 10 – 20 rs. But we suggest you to pick the penny stocks based on not only the price but also some key fundamentals. Also technical analysis will help us to pick the right stock along with the fundamentals.
In some cases, penny stocks are illiquid. That case we should avoid those stocks as liquidity is important to buy or sell. Before investing basic analysis is important to assess those stocks are having enough potential to deliver multifold returns or not, also this analysis will helps you to build the conviction to hold for long time as penny stocks are highly volatile.
Penny stocks investing rules:
1. Always allocate a low capital which doesn’t impacts your financial position
2. Keep in mind that penny stocks are highly volatile.
3. Avoid illiquid penny stocks as they wouldn’t allow you to buy or sell.
4. Don’t buy blindly as there will be price manipulation in some stocks.
5. Remember every penny stock will not become multibagger.
6. Basket approach is always better than investing into any single stock.
10 Best Penny Stocks to invest:
1. Udaipur Cement Works Ltd.
Udaipur Cement Works Ltd is one indian cement manufacturer, having the presence in northern states and expanding it’s foot prints to eastern states. Udaipur Cement is also a subsidiary of india’s one of the leading cement manufacturer JK Lakshmi Cement. Udaipur Cement sells the cement under the brand name of Platinum Heavy Duty Cement.
Promoters are increasing their stake and significantly voumes are increasing in the particular stock, if you observe the 5 years sales and profit variation is above 20%, which is good for the company. Company also expanding their capacities. This stock currently trading around 32.
2. Bank of Maharashtra
Bank of Maharashtra is an Indian public sector bank which caters banking services in India. Though it’s not a penny stock we’ve picked this stock to bring the stability to the portfolio and it’s trading below 50 rs.
The key point to observe that company posting good results past few quarters and if you look at the operational profit margin of the company is 58%, which is higher than state bank of india, though its having higher PE than SBI. This stock is currently trading around 47.
3. PTC India Financial Services Ltd
PTC India Financial Services Ltd is a NBFC, provides majorly debt financing to the the companies in power generation and distribution sector. Interest on loans is the major income source for this company as it provides debt financing.
To be considered debt is higher and quarterly results also not good but volumes are continuously increasing and the operational profit margins are higher than industry leader Bajaj finance which is good. If company posts positive results we may see the jump in price. This stock is currently trading around 29.
4. Imagicaaworld Entertainment Ltd.
Imagicaaworld Entertainment is an entertainment company which runs the themed and advernturous parks in india. It has 26 parks such as water parks, theme parks and adventurous parks. The popular brands are Mambo Chai Chama, Tubby takes off, wagonO wheels, scream machine and Nitro and Gold rush express.
The debt is higher but the company has the liquidity and running positive cash flows. Voumes are increasing and trading around 52 week high, possible of break out. There is no promoter pledge and trading at lower valuations compare to peers which is good. This stocks is currently trading around 52.
5. BMW Industries Ltd
BMW Industries Ltd is from steel sector, this company involved in processing, manufacturing and selling of steel products and it’s related such as towers, TMT, pipes and many more.
Ther is no debt and promoter pledge and the operational profit margin is 28%, which is higher than Ratna mani metals. Dividend yields are there in the company and the volumes are increasing continuously which is positive. This stock is currently trading around 49.
6. SBC Exports Ltd.
SBC Exports Ltd. Is a microcap logistics company, which provides IT services, Manpower services, Travel services and Textiles. If you observe the 5 years sales variation is 27.33%. 5 years profit variation is 51%, which is good and trading around the 52 week high. This stock is currently trading at 24.
7. NBCC India Ltd.
NBCC India Ltd. is an government sector infrastructure company, we can see a good growth in the company as our nation is focusing on infrastructure development. This company has good return ratios and providing good dividend yields. This company is trading around 58.
8. Kaushalya Infrastructure Development Corp Ltd.
Kaushalya Infrastructure Development Corp Ltd is a construction company also engaged in the development and sale of land and this company operates some hotels. Return ratios, book value are good enough but posted negative results. Once movement starts this stock will become multibagger as this stock currently trading at 6.95.
9. Axita Cotton Ltd.
Axita Cotton Ltd. Is a textile company which manufactures and trade the cotton bales. This company also processes the seed cotton. There is no pledge, ROCE is 49%, ROE is 38% and the cash flows are positive. This stock is currently trading around 26.8.
10. GP Petroleum’s Ltd.
GP Petroleum’s Ltd. Is an Indian manufacturer of Industrial and Automotive lubricants and this company is the part of GP group. This company sells the brands IPOL and has the rights of REPSOL. This stock posting negative results but chances of break out as it’s trading at 52 week high. This stock is currently trading at 54.
Conclusion:
Above discussed 10 stocks are the penny stocks that are trading around 50 rs. Some of those stocks are fundamentally good and some of those are ready to break out. So ther would be possibility of becoming multibaggers. Our sincere request is to allocate small amounts and basket approach is the best way to invest into these penny stocks. One or two stocks may be failed to deliver good returns but basket approach will save our portfolio.
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Note: as we are not SEBI registered, kindly contact your financial advisor before investing into any stock.