Best Penny Stocks to Buy in India – List of Top 10 Low Priced Shares of 2022Last Updated Date: Feb 17, 2023
Investors who are looking for aggressive returns sometimes look for penny stocks. This article will discuss the Best Penny Stocks to Buy in India.
We have shortlisted some penny stocks worth buying and taking the risk. We will be discussing the fundamentals of these stocks, companies, and their details.
In this article, you will find the details of the parameters which you need to check while making the Low Priced Stocks List.
You will also read about the financial metrics and ratios you need to evaluate while looking for these stocks.
Know about Penny Stocks in India
Penny stocks are those stocks whose current market price is very low such as within Rs. 20.
The Penny Stocks to Buy can be chosen based on their intrinsic value. These Penny Stocks in India trade on the stock exchanges and Over-the-counter.
These stocks are mainly of the small companies newly listed on the stock exchanges or at their nascent growth stage.
These stocks can be a really good investment if the companies grow properly. If the company outgrows the market, some penny stocks can also be hidden gems.
Often, people investing in these stocks get exponential returns.
Top 10 Penny Stocks to Buy Today in India
Check out the Low Priced Shares or Ranking of Best Penny Shares to buy Today or Tomorrow or for Long Term –
As per our findings, the Best Penny Stocks in India are the ones that have their current market value of less than Rs. 20.
The Penny Stocks List that we have prepared has Indian Overseas Bank, UCO Bank, and Bank of Maharashtra as the three top penny stocks.
We have chosen all the fifteen stocks based on the current market price of less than Rs. 10 and have sorted them based on market capitalization.
These stocks are of companies with a CAGR of 10% and above and a market capitalization of Rs. 400 crores and above.
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Indian Overseas Bank – Best Penny Stocks to Buy
Indian Overseas Bank is the first pick for Best Penny Stocks to Buy. The Bank started to facilitate foreign exchange business and overseas banking services.
The bank offers personal banking services, including a savings account, current accounts, term deposits, home loans, retail, and other loans and mortgages.
It also offers gold investments, mutual funds, NRI banking facilities, etc.
This financial institution has also been providing services for the agriculture sector like short-term loans for the farmers, manufacturers, and others in agribusinesses.
Then a segment of the bank also deals in forex collection services.
Why invest in Indian Overseas Bank’s stocks?
Indian Overseas Bank (IOB) has been considered for Penny Stocks Trading in India because its current market price is less than Rs. 20 and its market capitalization is more than Rs. 400 crores.
Here are the reasons why you can consider investing in this stock:
- Firstly, the net cash flow of the banking institution has been rising over the years, and that is mainly from the core operating activities of the bank/ business.
- The company’s TTM EPS has been rising along with the TTM PE, which is even more than the sector PE of 21.68, while the TTM PE of IOB is 24.
- The company has been doing great with a low debt finance structure, and it is a plus for the shareholders.
- The annual EPS growth shows strong potential for the company.
- There is zero promoter pledge in the company.
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UCO Bank – Best Penny Stocks for Trading
UCO Bank is our second choice for Best Penny Stocks for Trading.
The financial institution mainly provides personal banking services such as savings accounts, current accounts, NRI accounts, and loans for various educational, personal, car, etc.
There are also products like working capital finance that one can opt for, then loans against securities issued by RBI and government, and other services.
The bank has a network of more than 2000 branches across the country, and it is also present in Singapore and Hong Kong.
Why invest in UCO Bank Stocks?
UCO Bank stocks are considered Penny Stocks in India as the price of the stocks is cheap at present.
However, this bank has immense potential to grow, and here are some of the factors which you can consider for investing in this penny stock:
- The ROE of the banking company has been improving for the past two years, and it’s helping the shareholders to make more profit.
- The company management is prudent enough to generate profits from their assets, and thus, the ROA has also been improving.
- The bank’s profits and revenue have been increasing, which are crucial signs of the company’s growth.
- The Annual EPS has been showing growth too.
- Cash flow from core business activities has been increasing, which signifies growth in the company.
Bank of Maharashtra – Top 10 Low Priced Stocks to Buy
Our third pick for the Top 10 Penny Stocks to Buy is the Bank of Maharashtra banking institution. This bank is Maharashtra’s largest bank per network of branches among all the public sector banks.
Besides providing basic personal banking facilities and FCNR accounts, foreign remittance services, and others. However, the most important services provided by this bank are to the agricultural sector and SMEs.
This financial institute facilitates the agriculture sector and SMEs by offering loans at nominal costs and terms and conditions.
Why invest in Bank of Maharashtra’s stocks?
In this Low Priced Shares List, Bank of Maharashtra comes in the third position because of its market capitalization, and the current market price is less than Rs. 20.
Here are some of the reasons to consider while thinking of investing in this stock:
- The bank has a zero promoter pledge.
- There is a very low debt percentage in its financial structuring.
- The FIIs and the FPIs are investing in the institute and increasing their shareholding. This signifies the growth potential of the bank.
- The revenue of the Bank of Maharashtra has been increasing for the past few quarters consecutively.
- The bank’s profit margins have been increasing, including the annual net profits. Increasing profit margins indicate the growth phase of any company.
JP Power Ventures – Top Penny Stocks in India
JP Power Ventures or Jai Prakash Power Ventures is our 4th pick for Top Penny Stocks in India. This is a power generation company incorporated in 1994 by the infrastructure conglomerate of India, Jaypee Group.
This firm is engaged in the production, planning, development, and implementation of power projects in India. This power company operates India’s largest hydroelectric power plant and produces power from thermal energies.
It is engaged in the transmission of the power as well.
Why invest in JP Power Ventures’ Stocks?
JP Power Ventures is one of the major power companies in the country with huge potential, and at present, its stocks are really cheap and thus considered for Penny Stocks Trading.
Here are certain factors which make this stock a great investment:
- The high Piotroski score signifies the great fundamentals and financials of the company.
- The annual EPS of the company has been increasing and staying strong for quite a long time, signifying the growth potential of the firm.
- The FIIs and the FPIs are investing in the firm’s shares and increasing the shareholding percentage.
- According to the technical analysis report, the price momentum is strong, and the price is also above the short, long, and medium-term moving average.
- The company’s net profit has been increasing, and that is not all; it is the profit margin that is increasing too, and thus it signifies growth.
Hathway Cable & Datacom Ltd. – Top Low Priced Shares in India
Hathway Cable & Datacom Ltd. is one the largest companies in the country for cable television and internet broadband services.
It is our pick for Best Low Priced Shares to buy because of multiple reasons. This leading cable and data operator provides analog and digital cable services to customers across the country.
It is also one of the leading internet service providers facilitating residential and commercial places. It provides consistent services, so it is becoming highly popular day by day.
Why can you invest in Hathway Cable & Datacom Ltd.?
There are different reasons you can consider investing in this Top Penny Stock in India. Here are the most important factors:
- The Piotroski score has been high, suggesting strong financials for the company.
- Return on Equity and Return on Assets has improved over the past two years. This signifies the efficiency of the management of Hathway Company. They have been prudent enough to churn out profit from the shareholders’ equity as well as the assets of the company.
- There is no debt at all in the company’s financial structure.
- The company’s revenue has been continuously increasing for the past three quarters.
- The FII/ FPI investments have been increasing, increasing their shareholding in the company. This gives the idea that the company is quite profitable and has great potential, a strong balance sheet, and great potential.
Hindustan Construction Company – Top 10 Penny Stocks
Hindustan Construction Company is our pick for the 6th of the Top 10 Penny Stocks. This company is one of the leading infrastructure companies in the country.
It is engaged in the development of high-value projects which are technically complex.
This company provides its services across different sectors, including transportation, oil and gas, marine, power, construction, water, irrigation, and urban infrastructure.
Why invest in Hindustan Construction Company’s stocks?
There are multiple reasons which make this Penny Shares in India a worthy investment –
- Hindustan Construction Company’s revenue and profit have increased significantly over the last few years.
- The PE ratio has been low; however, the return on capital employed has increased significantly.
- The FII and the FPIs have been increasing their shareholding in the company, which signifies growth potential.
- The company’s net cash flow has been growing for the past two years.
- As per the technical analysis report, there is strong price momentum, and the price is above all the moving averages – short, medium, and long-term investment.
Media Matrix Worldwide – Best Penny Stocks to Buy
Our 7th Best Penny Stocks to Buy is Media Matrix Worldwide. It is a technology and service provider company.
It is known for its next-generation technology services, renewable energy, CDM-based different businesses, and environment management services.
This company is one of the leading companies focusing on solar energy and other alternative forms of energy like wind and hydro.
Why invest in Media Matrix Worldwide?
The prime reasons for investing in this Penny Stock to Buy Today is –
- The company has no debt in its financial structure, which is a prime benefit for its shareholders.
- The company is into highly futuristic businesses, and these businesses will inevitably flourish in the future. So there is huge potential for this company to grow in the future.
- The company is generating net cash flow from the company’s core activities, which is a great plus. Furthermore, it is improving as well.
- There is strong momentum in the price rise of the company as well, which suggests an increase in the stock price soon.
Zee Media Corporation – Best Low Priced Stocks to Buy
In the list of Best Low Price Stocks to Buy Right Now, at the 8th position, we have Zee Media Corporation. This is one of the most popular media channels across India and abroad.
It comes in different languages, whether it’s Zee Bangla, Zee Marathi, Zee Punjabi, and all other major languages in the country.
It has its news channels, entertainment, music, and any other form of media and content that they produce and offer to the customers.
Zee is not only one of the leading media business houses in the country but also has international broadcasting services in the USA, Africa, Asia Pacific, Europe, and the Middle East.
Why invest in Zee Media Corporation’s stocks?
The Top Low Priced Stocks to Buy include Zee Media Corporation for all these reasons given below –
- Firstly, the company is one of the leading media companies in the country and worldwide.
- Then its net profit has been increasing, and that is not all, the profit margin has been improving every quarter.
- The revenues have been increasing for the last two quarters, another sign of growth.
- The FIIs and FPIs are investing in the company and increasing their shareholding, which suggests the company’s potential.
- The percentage of debt is low in the company’s financial structure, which attracts investors.
PTC India Financial Services – Best Penny Stocks to Buy
PTC India Financial Services is our 9th pick for the Best Penny Stocks to Buy today in India. It is one of the non-banking financial institutions in the country (NBFCs).
This company is engaged in financing the companies and businesses for energy projects. It also offers equity investments for short and medium-term investments.
Apart from energy producers, this company helps manufacturers transformers, conductors, cables, insulators, and similar products.
Why invest in PTC India Financial Services Ltd. stocks?
This Top Penny Stock has been doing well for quite some time now, and here are the reasons why this penny stock can be a hidden asset:
- The company’s net profit has been increasing along with the company’s profit margin. This signifies the growth of the company and its potential.
- The net cash flow has been improving for the past two quarters.
- There is zero promoter pledge in the company.
- This company’s book value per share has continuously improved for two years.
Urja Global – Top 10 Penny Shares to Buy
Urja Global is our 10th pick out of the Top 10 Penny Shares to buy. This company is in the business of power generation and supply. It provides solar energy to government, commercial, and utility customers.
Urja Global manufactures and trades crystalline photovoltaic modules and invests in PV-based solar power plants. It is also engaged in generating and transmitting hydropower and thermal power.
However, it is mainly into solar energy production and spreading awareness about solar energy.
Why invest in Urja Global Ltd.’s shares?
The reasons for investing in Urja Global stocks can be the following:
- It is one of the Top Penny Stocks to Buy because of its increasing annual net profits. The net profits have been increasing for the past two years.
- The FIIs/FPIs are increasing their shareholding in the company.
- The ROE, ROA, and RoCE have improved over two years. This signifies the strong company management that is efficient enough to churn out higher profits from the shareholder’s equity, company assets, and the capital employed.
- There is a low debt percentage in the firm’s financial structure and the Zero promoter pledge.
Syncom Formulations – Top Low Price Shares to Buy
In our Low Price Shares List, we also have five more companies that couldn’t make it to the top ten penny stocks to buy but have similar potential as the stocks above.
So, the eleventh stock that we have picked is Syncom Formulations. It is engaged in the formulation of pharmaceutical products. It produces different medicines, powders, capsules, oral pills, etc.
You can consider this company for investment because of its EPS growth, which has grown strong. Its TTM PE is also more than the sector PE of 36.69, while this company has recorded a TTM PE of 46.20 at present.
The company has low debt in its financial structure, which is one of the best parts of its functioning. The ROE of the company has been improving, so is the ROA, and even the RoCE has been increasing for the past two years too.
The annual net profits have been increasing for the past two years, and so is the book value per share.
KBC Global – Top Penny Stocks to Buy in India
KBC Global is another Top Penny Stocks to buy in India with great potential for future returns. It is into chemical and energy business consulting.
KBC Global provides business consultancy, software, and cloud services to energy and chemical companies.
It helps these companies automate their production units and other processes and helps them optimize their production. You can invest in this stock as there is low debt in its financial structure.
Then the foreign institutional investors increase their shareholding in the company. Moreover, the book value per share, profits, and even the profit margins are increasing, which is a great sign of the company’s growth.
Mangalam Industrial Finance – Penny Stocks to Buy
Mangalam Industrial Finance is the 13th Penny Stocks to Buy per our rankings. This firm is engaged in non-banking financial services and mainly provides financial services to industries of different kinds.
This is based in the city of Joy Kolkata, and you can invest in this stock as it has a very high PE which suggests that the stock is highly undervalued.
Then there is strong EPS growth, the net profit, and the profit margin increase. Then there is no debt in the company, which is a great plus for the shareholders.
The company has Zero promoters pledge as well. The price momentum has also been really strong, and the price is trading above the short, medium, and long-term moving averages.
Seacoast Shipping Services – Best Penny Stocks to Buy in India
Seacoast Shipping Services is a young and dynamic company engaged in ship chartering, coastal trade, freight forwarding, warehousing, and transportation of FMCG goods and mining and transportation that is shipping bauxite from mines to the port.
This is our 14th Best Penny Stocks to Buy in India, and you can buy this stock as it has been experiencing strong growth in its EPS, which means a higher return for the shareholders.
The RoCE of the company has been improving so is the ROE and ROA. The debt percentage is lower in the financial setup of the company.
The net cash flow has improved the annual net profits for the past two years. There is zero promoter pledge in the company.
MSP Steel & Power – Best Low Price Stocks to Buy in India
MSP Steel & Power Ltd. is our 15th and final pick for Best Low Priced Stocks to Buy Today in India. This company is engaged in the production of sponge iron. It also trades steel products.
The range of products is varied and includes structural rolling mills, pallets, construction bars, sponge iron, M.S Billet, powder, and other products. It has a higher TTM PE compared to sector PE.
It has a high Piotroski score suggests the strong financials of the company.
The rising net cash flow indicates business potential as the cash flow is primarily generated from the company’s core activities. Furthermore, the revenue of the company has been increasing as well.
How to identify a good Penny Stock for Trading?
While picking Penny Stocks to Buy, you need to keep in mind the following factors –
- You need to analyze the financial history of the company. When the company started operating, the revenue increased, sales, turnover, profits, and other important financial metrics and ratios.
- Then compare the shortlisted penny stocks and find the most suitable one for your portfolio.
- Penny stocks can be risky investments, so if you are unsure about something about the company, make sure you clear all your doubts before investing in the stocks.
- You should invest small amounts in the penny stocks and not all of your savings. While penny stocks can be hidden gems, they can be dark pits.
- You need to check different broker’s websites to find the penny stocks they are offering, as this would give you a good idea about which all penny stocks are trending.
- The Penny Stocks List that you prepare keeps on evaluating it as penny stocks can turn around at any given point.
Fundamental Analysis Metrics to Identify good Penny Shares
To find the Best Penny Stocks to Buy in India, you need to evaluate the following fundamental analysis metrics:
Net Sales – Firstly, you need to evaluate the company’s net sales. Whether the net sales are increasing or not. The net sales increase must help understand the company’s growth potential.
Shareholding Pattern – You need to evaluate the shareholding pattern in the company. You need to check what percentage of shares are held by foreign institutional investors, HNIs, domestic investors, etc. This would give you an idea about the company’s prospects too.
Cash from operations – The third fundamental analysis metric you need to evaluate for finding Top Penny Stocks is cash from operations.
It is a highly important metric. This signifies how the business is doing, how well the company’s management has been working around the business generation to earn profits, and how much the business is relevant in the present-day market.
Financial Ratios to identify Low Priced Stocks for Investment
We will now discuss the financial ratios you need to check for picking up Low Priced Stocks for Investment.
Price to Sales Ratio – The P/S ratio is the ratio that can be derived by dividing the price of the company’s stock by the number of annual sales of the company per share basis.
This would give you an idea of whether an investment is overvalued or undervalued. Anything around two or less than that is fine.
Quick and current ratio – These ratios are important, and you need to evaluate both. Both ratios will help you understand the liquidity aspect of the company.
This will help you understand whether the company will be able to return your investment of yours in case the company gets winded up.
Debt ratio – Another important ratio is the debt ratio. You need to check this to understand how much debt is there in the company’s financial structure.
Penny Stocks to Buy in India is always great to choose the company where the debt ratio is minimal, around 0.5 or so.
Why invest in Penny Stock?
The prime reasons for investing in Best Penny Stocks to Buy are –
- You can earn exponential returns provided you choose the right penny stocks.
- You can buy many shares as the price of these penny stocks is cheap; most of them are in the range of Rs. 10 to Rs. 20.
- Penny stocks can be great for those looking for aggregative growth and have to risk appetite.
Cons of Penny Stocks Trading
The Best Penny Stocks in India Today come with certain risk factors too:
- These stocks are highly volatile. The price keeps on fluctuating, and thus, these can be highly risky investments.
- Many fraud companies issue their stocks at a low price to money from the market and then vanish away. So, be very cautious while picking up penny stocks for investments.
Best Penny Stocks – Conclusion
While investing in Penny stocks from the Best Penny Stocks List given above, you need to check all the important financial ratios, fundamental analysis metrics, and other details about the companies.
It is crucial to make a highly informed decision while trading in penny stocks.
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