Best Penny Stocks To Buy Right Now In India 2024
FEATURED PARTNER OFFER
Reliance Power
Current Market Price
INR 22.80
Market Cap
8,689.50 cr
Annual Range
33.15 / 9.05
Current Market Price
INR 22.80
Market Cap
8,689.50 cr
Annual Range
33.15 / 9.05
Why We Picked It
Reliance Power has demonstrated impressive share price returns over various timeframes, with gains of 10.35% in the last three months, 144.39% over the past year, 475.86% over three years, and 129.82% over five years. This strong performance reflects positive market sentiment and suggests robust growth potential for the company.
Examining its financial metrics, Reliance Power’s allocation of 33.5% of its operating revenues towards interest expenses and 2.37% towards employee costs in the year ending March 31, 2023, highlights prudent financial management.
By effectively managing its interest expenses and maintaining a relatively low proportion of operating revenues allocated to employee costs, Reliance Power demonstrates sound financial discipline, which could contribute to its long-term sustainability and profitability.
FEATURED PARTNER OFFER
Vodafone Idea
Current Market Price
INR 12.85
Market Cap
INR 62,553.40 cr
Annual Range
18.40 / 5.70
Current Market Price
INR 12.85
Market Cap
INR 62,553.40 cr
Annual Range
18.40 / 5.70
Why We Picked It
Vodafone Idea’s share price returns depict a mixed performance over various timeframes, with declines of -5.49% in the last three months and -61.03% over the past five years, alongside gains of 104.76% over the past year and 32.31% over three years. Despite recent fluctuations, the company has delivered a 3-year return of 30.77%, albeit lower than the Nifty 100’s return of 50.25%, suggesting comparatively subdued performance relative to the broader market index.
Examining its financial metrics, Vodafone Idea’s allocation of 55.37% of its operating revenues towards interest expenses and 4.42% towards employee costs in the fiscal year ending March 31, 2023, indicates significant financial commitments and operational costs.
Such high interest expenses may signify the company’s debt burden, while the allocation towards employee costs reflects its investment in human resources. Understanding the company’s efforts to manage its debt levels and optimize operational efficiency would be crucial for evaluating its long-term financial health and sustainability.
In summary, while Vodafone Idea has shown positive share price returns in the short term, its performance over longer periods has been volatile and challenging. This stock is for people willing to park money for long term investments.
FEATURED PARTNER OFFER
South Indian Bank
Current Market Price
INR 28.15
Market Cap
5,891.07 cr
Annual Range
36.52 / 15.40
Current Market Price
INR 28.15
Market Cap
5,891.07 cr
Annual Range
36.52 / 15.40
Why We Picked It
South Indian Bank has delivered positive share price returns across various timeframes, including gains of 5.02% in the last three months, 62.82% over the past year, 215.64% over three years, and 76.01% over five years. This consistent growth reflects the company’s resilience and potential for long-term value creation.
Analyzing its financial activities, South Indian Bank’s utilization of INR 386.06 cr for investing activities represents a significant year-on-year decrease of 77.82%. While this reduction may indicate a more conservative approach to investments or a strategic shift in capital allocation.
Overall, South Indian Bank’s positive share price performance and financial management suggest a promising outlook for the company, potentially making it an attractive investment opportunity for investors seeking growth and stability in the banking sector.
FEATURED PARTNER OFFER
Yes Bank
Current Market Price
INR 22.95
Market Cap
INR 66,007.81 cr
Annual Range
32.85 / 14.70
Current Market Price
INR 22.95
Market Cap
INR 66,007.81 cr
Annual Range
32.85 / 14.70
Why We Picked It
YES Bank has demonstrated a mixed performance in terms of share price returns over different timeframes. Over the past year, the stock has seen a significant increase of 53.44%, while over three years, it has recorded a moderate gain of 56.52%. However, over the longer term of five years, the stock has experienced a substantial decline of -90.72%. These fluctuations reflect the dynamic nature of the company’s performance and market sentiment.
Examining its financial metrics, YES Bank reported a year-on-year increase of 12.31% in its advances, indicating growth in its lending activities. This growth rate surpasses its 5-year compound annual growth rate (CAGR) of -3.38%, suggesting a potential turnaround in its lending business.
Additionally, the company’s total income has shown consistent growth over the quarters, with a modest increase in the most recent quarter of December 2023.
FEATURED PARTNER OFFER
Regent Enterprises
Current Market Price
INR 3.50
Market Cap
11.71 cr
Annual Range
7.01 / 2.61
Current Market Price
INR 3.50
Market Cap
11.71 cr
Annual Range
7.01 / 2.61
Why We Picked It
Regent Enterprises presents itself as an investment opportunity for investors due to several factors. Firstly, the company’s consistent annual revenue growth, outperforming its three-year CAGR, showcases its ability to generate increasing income over time. This indicates a positive trajectory and suggests the company’s resilience in navigating market challenges.
Secondly, despite fluctuations in quarterly total income, the overall trend points towards a potential rebound, as evidenced by the recent increase in total income. This resilience amid short-term fluctuations signifies the company’s underlying strength and adaptability.
Additionally, investors may find appeal in Regent Enterprises’ potential for future growth, especially if it continues to capitalize on emerging market opportunities or implements strategic initiatives to enhance profitability. Furthermore, the company’s performance relative to its peers make it an attractive option for investors seeking long-term growth potential in their investment portfolios.
FEATURED PARTNER OFFER
Oricon Enterprises
Current Market Price
INR 32.85
Market Cap
515.90
Annual Range
49.30 / 15.15
Current Market Price
INR 32.85
Market Cap
515.90
Annual Range
49.30 / 15.15
Why We Picked It
Oricon Enterprises emerges as an investment opportunity for investors, primarily driven by its impressive annual revenue growth. With a growth rate of 15.18%, surpassing its three-year CAGR of -13.05%, the company demonstrates a remarkable turnaround in its financial performance. This upward trajectory signifies a significant improvement in revenue generation and underscores the company’s ability to adapt in changing market conditions. When considering the company’s share price returns, Oricon Enterprises exhibits strong performance across multiple time frames.
Over the past year, investors received a return of 81.49%, reflecting the company’s ability to deliver value and capitalize on market opportunities. Even over longer periods, such as three and five years, Oricon Enterprises continues to provide attractive returns of 64.25% and 8.42%, respectively. This consistency in delivering positive returns highlights the company’s resilience and potential for sustained growth.
As such, investors seeking opportunities for capital appreciation and long-term value creation may find Oricon Enterprises to be an addition to their investment portfolios.
FEATURED PARTNER OFFER
Brightcom Group
Current Market Price
INR 15.15
Market Cap
3,047.97 cr
Annual Range
36.45 / 9.35
Current Market Price
INR 15.15
Market Cap
3,047.97 cr
Annual Range
36.45 / 9.35
Why We Picked It
Brightcom Group demonstrates potential for investors, supported by its performance in recent years. Despite occasional intraday declines exceeding 5%, such instances occur in only a minority of trading sessions, indicating relative stability in its price movements.
Over the past three years, the stock has delivered remarkable returns of 242.59%, significantly outpacing the broader market represented by the Nifty Smallcap 100, which recorded a return of 79.87% over the same period. This outstanding performance underscores Brightcom Group’s ability to generate substantial value for investors. Furthermore, even amid short-term fluctuations, the company’s long-term trajectory remains good, with five-year returns reaching an impressive 945.2%.
FEATURED PARTNER OFFER
McLeod Russel (India)
Current Market Price
INR 27.95
Market Cap
288.30 cr
Annual Range
37.85 / 16.75
Current Market Price
INR 27.95
Market Cap
288.30 cr
Annual Range
37.85 / 16.75
Why We Picked It
The low occurrence of intraday declines exceeding 5% in the last eight years, accounting for only 10.55% of trading sessions, indicates relatively low volatility in Brightcom Group’s stock price movements. While low volatility can offer investors a smoother ride, the assessment of whether this is ultimately beneficial depends on various factors, including the company’s fundamentals and overall market conditions.
McLeod Russel India’s annual revenue growth of 47.29%, outperforming its 3-year CAGR of 39.3%, reflects a robust expansion in its business operations. This consistent growth trajectory, coupled with its impressive long-term share price returns of 242.59% over three years and 945.2% over five years, suggests strong growth potential and may position Brightcom Group as an attractive investment opportunity for investors seeking long-term capital appreciation.
Comparison Of Best Penny Stocks To Buy Now In India
| COMPANY | Company – Logo | Current Market Price | Market Cap | Annual Range | Learn More CTA text | Learn more CTA below text | LEARN MORE |
|---|---|---|---|---|---|---|---|
| Reliance Power |  | INR 22.80 | 8,689.50 cr | 33.15 / 9.05 | View More | ||
| Vodafone Idea |  | INR 12.85 | INR 62,553.40 cr | 18.40 / 5.70 | View More | ||
| South Indian Bank |  | INR 28.15 | 5,891.07 cr | 36.52 / 15.40 | View More | ||
| Yes Bank |  | INR 22.95 | INR 66,007.81 cr | 32.85 / 14.70 | View More | ||
| Regent Enterprises |  | 3.50 | 11.71 cr | 7.01 / 2.61 | View More | ||
| Ubersuggest |  | 32.85 | 515.90 | 49.30 / 15.15 | View More | ||
| Brightcom Group |  | 15.15 | 3,047.97 cr | 36.45 / 9.35 | View More | ||
| McLeod Russel (India) |  | 27.95 | 288.30 cr | 37.85 / 16.75 | View More |
Note: All stock prices are updated as on March 20, 2024.
Features of Penny Stocks
Before investing in penny stocks, it is particularly important to understand they are low on a range of parameters:
Pricing
For a stock to be categorized as a penny stock, it needs to be dirt cheap, essentially the price of a penny that is one-hundredth of a U.S. dollar. In India, the price of penny stocks in India ranges mostly between INR 10 – INR 20. Penny stocks as low as INR 1 are also available for trades.
Market capitalization
The market cap of penny stocks is generally quite low. In some cases, stocks that have suddenly fallen in value due to debt issues or corporate governance challenges end up in the penny stocks category. In India, the majority of penny stocks have low to moderate market cap.
Liquidity
An important feature of penny stocks is the low liquidity that they offer. This means the trader may not be able to buy or sell the penny stock of their choice at all given times—this makes investing in penny stocks riskier owing to their illiquidity.
Historical information
Many penny stocks are stocks of companies with limited historical information, which implies that the investor may not be fully aware of the company’s operations and future prospects may not be very transparent. This, however, is not the case with all penny stocks.
Benefits of Penny Stocks
There are three main benefits of trading in penny stocks:
- High returns upon low investment
One can buy a large number of shares at a very low price and make decent returns whenever the stock clocks gains. The performance of most penny stocks is dependent on news relating to their operating sectors and the possibility of making a sizable return upon stock rallies is high. - Investment in future winners or multibaggers
Stocks that are dormant or dead today may turn into multibaggers of tomorrow. Early investment in penny stocks that show future potential may set the investor’s path to be invested in stocks that exhibit robust growth trajectory. - Available for all to trade in
The low pricing makes penny stocks easy to invest in. Anyone who wishes to invest a small corpus in the stock market is able to buy a considerable number of shares and hence penny stocks are available for all to trade in.
Risks Associated with Penny Stocks
Your investment can vanish in thin air is the biggest risk associated with investing in penny stocks. Other major risks to watch out for include:
Inability to cash out
Building a large corpus of a set of penny stocks isn’t enough and often an unwise decision. Due to their thin trading volumes, penny stocks are difficult to cash out and investors may end up finding no buyers for the shares they wish to sell.
Market manipulation may result in losses
The information floating around penny stocks in the market can be misleading and land an investor with shares of stocks that are worth nothing. Wild fluctuations in prices led by market participants is a common problem with penny stocks. Inaccurate information on the stocks performance and future prospects can also wreck one’s portfolio gains.
Should You Invest in Penny Stocks
Investing in penny stocks is highly risky. For any individual to invest in penny stocks, it is important for them to gather complete information of the company they are investing in and also keep a close eye on the information relating to the company’s growth projections.
Penny stocks are not advisable for beginners as they may not completely understand the risks associated with such investments. Penny stocks are best traded by seasoned investors who have a good grip over market speculations and invest after thorough analysis and research.
Multi Bagger Penny Stocks
What are multibagger penny stocks?
Penny stocks are mostly stocks that are known to help investors make quick returns. This has its own set of risks and sometimes when the market turns volatile, your gains could erase out completely.
The same stocks in a bullish market could potentially multifold the returns you make on them. Such penny stocks that give an investor many times the returns than their investment are called multibagger penny stocks.
How to identify multibagger penny stocks?
Identifying a penny stock that can potentially multiply returns requires you to follow a simple checklist over the basic criteria that the stock you invest in should have strong fundamentals and growth potential in the short to mid-term.
Your checklist to choose a future multibagger penny stock:
- Stock should not be running into losses. The profit after taxes (PAT) or the EBITDA must show positive numbers.
- Stock should have a debt-to-equity ratio of less than 0.5.
- Stocks with promoters holding less than 50% are riskier and should be avoided.
- Stocks in which promoters have pledged their shares also fall under the high risk category and should be missed out.
How long should you wait for your stock to turn multi-bagger?
Alpha growth on your penny stock in a short-term period is possible if the share price of the stock of your choice suddenly skyrockets. This is possible in two scenarios:
- On news that favors the sector the stock is exposed to
This could lead to a short-term rally - The company wins a contract or expands in a growing segment
This could lead to a long-term rally
Depending on the risk appetite, you can decide to time your exit.
Frequently Asked Question (FAQs)
How to trade in penny stocks?
To trade in penny stocks, you need to have a demat account. An investor can simply begin trading in penny stocks directly via an online trading platform.
Do penny stocks help in making good returns?
It is not necessary you would be able to make phenomenal returns when investing in penny stocks. Such stocks generally have a low bid-ask spread, are not frequently traded, and even risk being completely wiped out. It is the volatility in these stocks that present an opportunity for investors to experiment with stocks that have a low market capitalization and make some returns.
What is an alternative to investing in penny stocks?
The best alternative to investing in penny stocks are mutual fund investments, which are professionally managed and help investors create a diversified portfolio across asset classes such as shares, bonds and money market instruments.
Are penny stocks too risky to invest in?
Being low on liquidity, penny stocks could be risky to invest in. For instance, you may buy a penny stock at a very low price but may not find buyers when you wish to sell it. Some penny stocks die out with time and may potentially get delisted resulting in losses. While investing in penny stocks, one has to be diligent in their research and invest their entire corpus in a diversified manner to hedge against potential risks that come with higher return prospects of penny stocks.
What are the top penny stocks in India?
Penny stocks are highly volatile stocks and the ranking of the best penny stocks keeps changing quite erratically. According to Forbes Advisor India’s latest analysis, Vodafone Idea, Suzlon Energy, Bank of Maharashtra rank among the top penny stocks in India at the moment.
What are the safest penny stocks to buy?
The safest penny stocks to buy include stocks of companies that were once large cap companies with a robust foundational parent group, which is willing to pay off debts and rectify issues related to the subsidiary stock.
A classic example of safe penny stocks in India is Vodafone India, which is in deep waters due to its debt obligations but also has the backing of the Government of India and billionaire promoters including KM Birla. So, while it is risky to invest in Vodafone Idea, it could be seen as a calculated risk.
How many penny stocks should I buy?
Investment in any asset class should not typically exceed 5% to 10% of your financial portfolio. This is to ensure your risk is diversified across investments and you are able to offset any unexpected losses by growth in another asset class.
