A debt-free company is always looked at with a positive outlook, as there is less risk of bankruptcy and management looks confident. In this article, we will look into a few of the best debt-free stocks that are below Rs 500. Keep reading to learn about it.

Best Debt-Free Stocks Under Rs 500 #1: ITC Ltd

Best Debt-Free Stocks Under Rs 500 -ITC Ltd Logo Image

ITC Limited, founded in 1910, is a conglomerate involved in various industries such as fast-moving consumer goods (FMCG) such as food, personal care, cigarettes, education and stationery products, incense sticks, and safety matches. ITC is also in the business of hotels, paperboards and packaging, agribusiness, and IT.

ITC’s consumer goods businesses have created an amazing portfolio of over 25 Indian brands, such as Aashirvaad, Sunfeast, Yippee!, Bingo!, B Natural, ITC Master Chef, Fabelle, Sunbeam, Fiama, Engage, Vivel, Savlon, Classmate, Paperkraft, Mangaldeep, Aim, and others.

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The company’s financial statements reported a 17% increase in revenue from operations, from Rs. 60,645 crore in FY22 to Rs. 70,919 crore in FY23. The net profit stood at Rs 19,477 crore, increasing 26% from Rs 15,503crore in FY22. The three-year average RoE and RoCE stand at 25% and 33.6%, respectively. The 3-year net profit margin stood at 27.92%.

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The promoters of the company hold 0% of the shares as it is professionally operated, and FII holds 43.26% of the shares as of December quarter of FY24. The FII percentage has increased drastically compared to 11.99% in FY22.

ParticularsAmountParticularsAmount
CMP 411Market Cap (Cr.)₹ 5,61,560
EPS(TTM)16.5Stock P/E25
RoE29%RoCE39.1%
Promoter Holdings0%FII Holdings43.26%
Debt to Equity0Price to Book Value8.53
Operating Margin37.60%Net Profit Margin27.40%

Best Debt-Free Stocks Under Rs 500 #2: Coal India Ltd

Best Debt-Free Stocks Under Rs 500 - Coal India Ltd Logo Image

Established by the Government of India in November 1975, Coal India Limited (CIL) is a state-owned coal mining Maharatna Company. It is the largest coal producer in the world, with a production of 79 million metric tons since its inception.

The Coking Coal Mines Act 1971 and Coal Mines Ordinance 1973 gave the government access to take over 226 coking coal mines and 711 non-coking coal mines, leading to the birth of CIL. Coal India produced 703.2 MT of coal in FY’23, registering a growth of 13% from FY22. It breached the 700 MT production mark for the first time on March 30th, one day ahead of the closure of 2022–23.

The company’s financial statements reported a 27% increase in revenue from operations, from Rs. 1,00,563 crore in FY22 to Rs. 1,27,627 crore in FY23. The net profit stood at Rs. 28,125 crore, an increase of 61% from Rs. 17,378 crore in FY22. The significant profit growth can be attributed to the surge in sales along with an increase in average realization per tonne.

The three-year average RoE and RoCE stand at 46% and 22%, respectively. The ratio indicates efficient utilization of resources and good returns for shareholders. The promoters of the company hold 63.13% of the shares, and FII holds 8.59% of the shares as of December quarter of FY24. The promotor’s holding has remained constant for the last four years.

ParticularsAmountParticularsAmount
CMP₹ 480.1Market Cap (Cr.)₹ 2,66,876
EPS(TTM)47.7Stock P/E10
RoE40.27%RoCE44.51%
Promoter Holdings63.13%FII Holdings8.59%
Debt to Equity0.09Price to Book Value3.41
Operating Margin25.30%Net Profit Margin20.30%

 Best Debt-Free Stocks Under Rs 500 #3: Wipro Ltd

Wipro Ltd Logo Image

Founded by Mr. Azim Premji in 1945, Wipro Limited is a leading technology service and consulting company. It is a company focused on building innovative solutions that address the complex digital transformation needs of clients. 

Wipro provides a host of services such as consultancy, cybersecurity, data analytics, business processes, and artificial intelligence. It has a presence in 65 countries with over 1400 active global clients and an employment base of more than 2,50,000 employees spread across continents.

Wipro functions in two business lines:

  • iDEAS (Integrated Digital, Engineering, and Application Services), which includes the following service lines: domain and consulting, applications and data, Wipro Engineering, and Wipro Digital. 
  • iCORE (Cloud Infrastructure, Digital Operations, Risk, and Enterprise Cyber Security Services), which includes Integrated Cloud Infrastructure (CIS), Digital Operations (DOP), and Risk and Enterprise Cybersecurity Services (CRS),.

The company recently acquired multiple IT companies all over the globe, like CAPCO, Edgile, Rizing, LeanSwift, and Convergence Acceleration Solutions (CAS). 

The company’s financial statements reported a 14% increase in revenue from operations, from Rs. 79,093 Cr in FY22 to Rs. 90,488 Cr. in FY23. The net profit stood at Rs. 11366 crore, decreasing from Rs. 12243 crore in FY22.

The three-year average RoE and RoCE stand at 18.4% and 20.3%, respectively. The ratio indicates efficient utilization of resources and making good returns for shareholders. The net profit margin decreased from 15.42% to 12.54%.

The promoters of the company hold 72.92% of the shares, and FII holds 6.70% of the shares as of December quarter of FY24. The promotor’s holding decreased compared to FY20 by 1.12%.

ParticularsAmountParticularsAmount
CMP₹ 539Market Cap (Cr.)₹ 2,43,167
EPS(TTM)21.1Stock P/E25.0
RoE16.77%RoCE18.14%
Promoter Holdings72.90%FII Holdings6.70%
Debt to Equity0.26Price to Book Value3.45
Operating Margin18.80%Net Profit Margin12.60%

 Best Debt-Free Stocks Under Rs 500 #4: Fortis Healthcare

Fortis Healthcare Logo Image

Established in 1996, Fortis Healthcare is a healthcare organization in India with 28 healthcare facilities, 4,500+ operational beds, and over 400 diagnostic centers. Fortis has over 3700 touchpoints, with 430+ doctors and 4150+ lab technologists. It is in India, the United Arab Emirates (UAE), Nepal, and Sri Lanka.

 Fortis Healthcare Annual Report
Source: Annual Report

The company’s financial statements reported a 10% increase in revenue from operations, from Rs. 5718 crore in FY22 to Rs. 6298 crore in FY23. The net profit stood at Rs. 632.98 crore, down 20% from Rs. 789.95 crore in FY22. The net profit decreased as there was a huge, exceptional gain last year.

Removing the effect of the exceptional item, the net profits increased by 17%. The three-year average RoE and RoCE stand at 4.39% and 7.38%, respectively. The 3-year average net profit margin stood at only 6.84%.

The promoters of the company hold 31.17% of the shares, and FII holds 23.72% of the shares as of December quarter of FY24. The promotor’s holding has remained constant for the last few years.

ParticularsAmountParticularsAmount
CMP₹ 431.6Market Cap (Cr.)₹ 34,150
EPS(TTM)7.25Stock P/E60.9
RoE7.2%RoCE10.43%
Promoter Holdings31%FII Holdings31.22%
Debt to Equity0.14Price to Book Value4.22
Operating Margin17.30%Net Profit Margin8.90%

Best Debt-Free Stocks Under Rs 500 #5: Nippon Life India Asset Management Ltd

Nippon Life India Asset Management Ltd Logo Image

Nippon India Mutual Fund was registered with the Securities ​​& Exchange Board of India (SEBI) on June 30, 1995, as an asset management company (AMC). Nippon India Mutual Fund (NIMF) was earlier known as Reliance​​​ Mutual Fund. The name of the mutual fund was changed from Reliance Mutual Fund to Nippon India Mutual Fund effective September 28, 2019.

The NIMF was established to launch different schemes under which units are issued to the public to contribute to the capital market and provide investors with opportunities to make investments. Its sponsor, Nippon Life Insurance Company Japan (NLI), holds 73.7% of its paid-up equity share capital as of March 31, 2023.

The company’s product lines include mutual funds, including active and passive schemes across equity, hybrid, debt, liquid, and commodity categories; managed accounts, including alternative investment funds (AIF); portfolio management services (PMS); pension funds; and offshore business and advisory mandates.

As of March 31, 2023, Nippon AMC caters to 1.35 crore unique investors (market share: 36%) with a presence in 270 locations and 1.96 crore folios. The total assets under management (AUM) stood at ₹ 3,62,981 crore, and the mutual fund AUM stood at ₹ 2,86,873 crore.

The company’s financial statements reported a 3.3% increase in revenue from operations, from Rs. 1307 crore in FY22 to Rs. 1350 crore in FY23. The net profit stood at Rs. 723 crore, decreasing 3% from Rs. 744 crore in FY22. The three-year average RoE and RoCE stand at 22.3% and 29.3%, respectively. The 3-year average net profit margin stood at only 58%. 

The promoters of the company hold 73.10% of the shares, and FII holds 5.54% of the shares as of December quarter of FY24. The promotor’s holding decreased by ~2% from FY20.

ParticularsAmountParticularsAmount
CMP (Rs)₹ 512.4Market Cap (Cr.)₹ 32,870
EPS(TTM)14.2Stock P/E33.7
RoE24.76%RoCE31.33%
Promoter Holdings74%FII Holdings4.95%
Debt to Equity0Price to Book Value8.29
Operating Margin59.60%PAT Margin47.80%

Other Top Debt-Free Stocks Under 500

NameCMP Rs.Market Cap (in Cr.)Debt / Equity
O N G C₹ 277.1₹ 3,24,3190.46
Jio Financial₹ 273.7₹ 1,69,5050
Bharat Electron₹ 190.15₹ 1,39,653 0
Zomato Ltd₹ 157.4₹ 1,25,437 0.03
GAIL (India)₹ 185.25₹ 1,12,8940.25
CG Power & Indu.₹ 436.5₹ 68,3150.01
B H E L₹196.4₹ 68387.70.35
NMDC₹ 247.5₹ 69,0150.09
Indian Hotels Co₹ 542.2₹ 70,367 0.33
General Insuranc₹ 429.55₹ 77,447 0

Conclusion

As we conclude this article, “Best Debt-Free Stocks Under Rs 500,” we have learned about their businesses and fundamentals. A detailed analysis is required to understand the risk and return characteristics and suitability before investing.

Written by Ashish Agarwal

By utilizing the stock screener, stock heatmap, portfolio backtesting, and stock compare tool on the Trade Brains portal, investors gain access to comprehensive tools that enable them to identify the best stocks also get updated with stock market news, and make well-informed investment decisions.


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