Mutlibagger Stocks below 1 Rupee in India: Should they be part of your portfolio?
Penny Stocks Below Rupee 1: Introduction
The decade -2020's, may have started with a major disruption in our lives through Covid-19 but what we saw in the trade market was a major turnover in the investing culture. Sure, we are running some years late, but as it is said ‘Better late than Never,' stands perfectly true in this case as well. Nevertheless, we have now entered into the age of investing, and it is certainly a good sign for the Indian economy. Apart from the sudden proactiveness to deal in the stock market, especially among the youth, the other thing that we can claim to be peculiar is the hype of the penny stocks where the highlight of the kind are stocks under 1 Rs
While as a rule of thumb goes-higher returns involve higher risks, investing in these shares of below 1 rupee, is not any different. Having mentioned that, the penny stocks in India have a huge potential of generating unpredictably extortionate returns. Let us examine how.
Summary in brief:
- 10 best penny stocks in India below 1 rupee in 2022
- Introduction to penny stocks
- Why penny stocks are a must in your portfolio
- Caution for investing in penny stocks below 1 rupee
- Investing tips for potential multibagger stocks below 1 rs
Best penny stocks in India below 1 Rupee in 2022
While we have by now understood the base of investing, we are ready to look at some of the penny stocks in India below 1 rupee in 2022, which are likely to become potential multibagger stocks of 2022.
|Name||Market cap (in cr)|
|Negotium Intl Trade||3.57||0.91||3.09|
|Sword Edge Commercials||14.1||0.66||1.19|
|Alps Motor fin||4.47||0.44||0.7|
Data as on September 1, 2022, 2:30 PM
Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns
In terms of investing, it is important to get your facts right. The above table provides you with an overview of how these 10 best penny stocks at below rs 1 have been performing throughout the year. If you invest with due diligence you are likely to hit a multibagger stock. However, at this time when India seems to have been moving towards recession, you must not throw caution to the wind.
Features of penny stocks below 1 rupee
- High returns: As compared to higher-priced equity, penny stocks below 1 rupee provide opportunities for great returns. They have great growth potential but are vulnerable and highly stable to market fluctuations
- Illiquid: These stocks are illiquid as the issuing companies are mostly unpopular. This becomes a concern when selling the shares. Usually individuals with a high-risk tolerance investment in penny stocks below 1 rupee
- Low cost: These sticks are extremely affordable plus pocket-friendly. An individual can be especially benefited if the price exponentially increases
- Unstable Pricing: These penny stocks do not achieve substantial pricing. The capital gains are minuscule unless it is not sold off in large quantities.
Penny Stocks Below 1 Rupee: Understand before you invest
Penny stocks are the shares traded in the stock exchange at a very low or steep value with unpredictable high growth and returns yet associated with high risk. The price of these stocks usually range between 0-30 rupees/stock but can grow to an even higher value with time. These are easy to invest in and require very minimum capital but a good amount of research. When these stocks provide you with stellar returns, they are known to be multibagger stocks. We shall further in our discussion look into some of the best multibagger stocks for 2022.
Why are penny stocks a must in your portfolio?
As to note, the one thing that is called to be of utmost importance in the world of investment is the mindset of the investor. Some investors like to play with huge risks but unfortunately have a shortage of capital, penny stocks are certainly a breakthrough for such investors.
Penny stocks, apart from bringing viability in a portfolio carries a number of benefits, especially for the new age investors-the risk-takers.
The reasons why one must invest in penny stocks in India, especially of below 1 rupee, in 2022 can be summarized by the following points:
High Potential Returns:
By now, you must have at least gathered a basic gist on the fact that penny stocks have the potential of generating bombarding returns. But how? Well, the logic is very simple, you invest 2000 rupees into some best penny shares of less than a rupee/stock, it increases to let’s say 2 rupee/stock in a month or so, and there you have your investment at a profit of more than 100% within few months, which is not easily possible even in a case of any high growth equity-oriented stock.
Opportunity to bag a multibagger stock:
Multibagger stocks are as fancy as they sound, if you manage to get your fundamentals correct and identify a multibagger stock you surely can see yourself standing to earn ultimate growth and maximum returns possible. If you may have bought some of the best shares at even 1 rupee, it might be trading at Rs 50 in a few years, thus giving you an unimaginable return provided that you have judiciously studied the background of such a stock.
Cheap Price Point:
One of the substantial benefits of investing in penny stock in 2022, is its inexpensiveness. It is easy on your pocket, and you can buy them in bulk without much sweat in your head. It therefore helps you to bring about diversification in your portfolio by saving your interest to invest in other schemes as well
Penny stocks below 1 rupee: Cautions to be taken
Aggressive investors shall probably have an incomplete portfolio without a penny stock but investing in these stocks are not very handy. These shares require a strong base of knowledge and must be acted upon with caution. Some of the factors that you must consider especially if you are new to investing in penny stocks are:
Difficult to access important information:
Most of the penny shares belong to companies that are not very known. To access the background as well as the financials of such companies becomes a very tedious process. The dearth of information is a real issue when it comes to such penny stocks of the microcap companies, as most of the time these are ignored and not potentially covered by known research firms or traders.
The price of these penny stocks can be easily manipulated. Most of the times the price of the stocks below rs 1 are subject to artificial inflation/deflation of large traders or promoters. These are also quite prone to hype and dump methods.
Feature Launch: SIP in US Stocks and ETFs.
We all love the SIP approach to investing - it averages out the cost of investing, and on top of it, the power of compounding continues the benefits if invested for the long term.
Following the users' demand, we have launched the US Stocks SIP feature. Now, you can invest as low as Rs. 500 SIP on a weekly or monthly basis in any US stock or ETF be it a Tesla, Amazon, Apple, Meta or Microsoft, or many such stocks and ETFs - check out the US stocks to start the SIP.
Potential multibagger stocks below 1 Rupee: What to keep in mind?
- Seek expert advice- Sometimes it is an edge to gaze at and compare different avenues through the eyes of someone who has been a long-time player in the field.
- Do thorough research before investing- You should understand the financials, and average annual returns and compare the profitability, earning capacity, and growth of the potential shares.
- Make a calculated decision but do not ignore your instinct as well.
- Penny stocks are bound to attract false information, beware of the same.
- Take note of the fact that penny stocks are bound to hit the lower circuit at most times.
- Look out for debt-free penny stocks below 1 rupee, such stocks comparatively have a lower risk of insolvency and have historically been taken as high yield stocks.
Important things to remember:
1. Do Not Blindly Follow Hot Tips
No matter how credible the source is, never follow a stock marketing tip blindly without conducting thorough research personally. Always select the stocks after doing proper research and analysis on the performance as well as the companies. While some tips can work out to give you huge benefits, the wrong ones can push you down under the risk pretty quickly.
2. Eliminate Loser Stocks from Portfolio
There is absolutely no guarantee that a stock will rise after a great fall. Know that it is extremely important to be practical about what is possible and what's impossible in the stock market. So, upon realizing that a stock is performing poorly in your portfolio, accept your mistake and sell it immediately to prevent further losses.
3. Don't Exceed Your Investment Budget Abruptly
While it's true that long-term investments are way better than other forms of investment, you shouldn't exceed your investment budget in a haste. Instead, decide on a fixed amount and invest it across various good stocks. Rather than investing in only one stock, divide your budget evenly across multiple good-performing stocks and shares.
Disclaimer: The securities quoted are exemplary and not recommendatory. This is not an investment advisory. The blog is for information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, goal, time frame, risk and reward balance, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. Performance and returns of any investment portfolio can neither be predicted nor guaranteed.
Do penny stocks yield dividends?
These penny stocks are usually of very small-sized companies and it is rare that such companies distribute any substantial dividend. Investors usually look for capital appreciation while investing in such stocks.
How to buy penny stocks?
Penny stocks are bought in the same manner as any other stocks. They are also traded in recognised stock exchanges like BSE and NSE and can be easily bought.
Can the price of penny stock become 0?
It is likely to happen when the company turns insolvent or is acquired by another company.
What are Ultra Penny Stocks?
The penny stocks that are traded below Rupee 1 are known to be ultra penny stocks.