13 Penny stocks with strong fundamentals

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RKD
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13 Penny stocks with strong fundamentals

Post by RKD »

It is well known that fundamentally strong penny stocks can become multibaggers.

There are a number of examples of the past which prove this point.

Three stocks, namely, Symphony, Mayur Uniquoters and Kitex Garments, were penny stocks in the past.

However, these stocks had good fundamentals in the form of a good business model.

The return on equity (RoE) and return on capital employed (RoCE) of all three penny stocks were also over 20 percent.

The result is that these stocks attracted institutional interest and have become multibaggers.

Applying the same test, we have to see if there are cheap stocks available in the stock market, which have strong fundamentals.

The RoE and RoCE of the stocks should also be reasonably high because that shows that business is able to generate profits consistently.

Applying this test, there is a shortlist of 13 penny stocks with good fundamentals, high ROCE, dividend yield and low debt/ debt-free that require consideration.

These 13 stocks are the following:

Name CMP Rs. P/E Mar Cap Rs.Cr. Div Yld % ROCE % CMP / BV
Wallfort Fin. 19.15 18.56 0.00 -27.63 0.19
APM Finvest 11.78 21.58 25.46 0.00 3.28 0.34
Integ. Fin. Serv 23.00 2.53 13.80 3.91 9.47 0.31
Real Touch Fin 16.50 13.25 20.94 0.00 4.80 0.63
Morarka Finance 18.45 3.12 8.30 0.00 4.69 0.59
Coral India Fin. 12.05 5.30 60.10 1.66 7.54 0.50
Frontline Sec. 25.15 13.56 25.08 0.99 8.68 0.61
Tokyo Finance 10.10 8.28 7.04 0.00 9.31 0.54
Upasana Finance 13.75 13.70 5.89 0.00 4.83 0.43
Nahar Capital 54.50 3.65 91.23 2.75 3.06 0.09
Elnet Technolog 88.00 3.27 35.20 1.70 16.36 0.44
Shardul Sec. 33.55 8.27 58.71 1.79 3.04 0.24
Goldcrest Corpor 60.00 6.53 34.14 0.83 12.35 0.70

We will have to closely study the performance of these 13 penny stocks to see whether they really have the potential to become long-term investing candidates for our portfolios.

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