Which Are the Best Penny Stocks With Strong Fundamentals in India?

Penny Stocks With Good Fundamentals: An Overview

Penny stocks are those stocks that are available at low prices. Since penny stocks are available at low prices, investors get overwhelmed. It is a great investment option for those who have a minimal budget and a high-risk appetite. However, penny stocks are highly volatile and investing in them might be risky. So, make sure to study the fundamentals of the company, and its financials, understand its management and work to make informed decisions. In this article, we are going to learn about strong fundamental penny stocks and the list of fundamental strong penny stocks. 

What Are Penny Stocks?

Penny stocks trade at low prices ranging from Rs. 1 to 10 or even more.  And this is the reason it is a popular investment option for millennial investors. Investors buy penny stocks at low prices and sell at high prices to make a profit. Generally, the trading volume of penny stocks is small and hence, they are highly illiquid. Some penny stocks with good fundamentals can give you multifold returns in a few months or years. 

Key Takeaways

• Penny stocks are available at a minimal price. 
• The market capitalization of penny stocks is below Rs. 5,000 crores. So, they are called nano-cap stocks or small-cap stocks
• Penny stocks are listed in small cap index or lesser known index. 

Best Penny Stocks With Strong Fundamentals in India

1. Ashirwad Capital: The company is a Non-banking financial corporation (NBFC). They deal in manufacturing carvings of jewelry, paintings, and precious stone. Also, they are engaged in the investment and lending business. The company is almost debt free and the stock price CAGR in the last 3 years is 23%. 
2. Beryl Securities: The company deals in providing advances and loans. It can be a good investment option as they are almost debt free and the stock is trading at 0,40 times its book value. 
3. Radhe Developers: The company was established in 1995 and deals in the real estate development business. It has delivered profit growth of 89.6% CAGR over the last 5 years and the stock price CAGR in the last 3 years is 126%. 
4. Luharuka Media: The company was established in 1981 and is an NBFC. It deals in the business of finance and providing loans. They provide auto/home loans, mortgage loans, and loans against shares and securities. The stock price CAGR is 87% and the compound profit growth has been 28% over the last 3 years. 
5. Norben Tea & Exports: The company was established in 1990 and deals in the manufacturing and growing of tea. They produce 600000 kgs of tea annually. The company’s stock is trading at 0.52 times its book value and the stock price CAGR over the last 3 years is 21%. 
6. CNI Research: The company was established in 1982 and deals in the business of content creation, equity research, and financial advisory. The company is almost debt free and has delivered compounded profit growth of 75% in the last 3 years. 
7. Transwind Infrastructures Ltd: The company was incorporated in 1997 and is a technology-driven company. It is almost debt free and its stock is trading at 0.44 times its book value. The company is almost debt free and the stock price CAGR over the last 3 years is 36%. 
8. BKV Industries: The company deals in the business of aquaculture firms. It has reduced its debt and is almost debt free. 
9. P.M Telelinks: The company is engaged in trading plastic granules in LLDPE/HDPE/LDPE, Quad cables, Signaling cables, PIJF cables, and MS steel. The company’s stock is trading at 0.76 times its book value and the promoters of the company have increased their holdings by 0.91% over the last quarter. 
10. Lesha Industries: The company was incorporated in 1992 and deals in trading steel products, deals in shares, and security. They provide technology services and solutions. The company has reduced its debt and is almost debt free. 

List of Penny Stocks With Strong Fundamentals

(Data as of 15th November 2022)

Disclaimer: The securities quoted are exemplary and not recommendatory. Past performance is not indicative of future returns

Conclusion

Investing in penny stocks can give you multifold returns. However, they are highly volatile and illiquid. So, do proper research and always pick fundamentally strong penny stocks that have the potential to grow in the near future. Also, it is important to consider your financial goals, ability to take risks, and expected return before investing in penny stocks or any financial instrument. 

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. The performance and returns of any investment portfolio can neither be predicted nor guaranteed.