Best Penny Stocks in India 2022: The stock market is known to make the lucky few millionaires over decades, years, and sometimes even months.

Ace investors like Warren Buffet are known to produce average returns of 30%, but what makes them special is that they have managed to do so for over 5 decades.

But on the other hand, there also exist stocks that have given multifold returns in just a short period of time.

Take the example of IKAB Securities and Investments over the last six months the stock has increased from Rs. 42 to Rs. 772 giving up to 1740% returns.

These are the kind of stocks that one dreams of adding to his/her portfolio. However, the stock market has a section that is specific to only these stocks where such dream returns are sometimes possible called Penny stocks.

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In this article, we take a look at the Top Penny Stocks that could turn out to be multibaggers in the near future. Keep Reading to find out!

What are Penny Stocks?

What are Penny Stocks in India - Pros cons how to trade

Penny stock is a term used to describe stocks that trade at single or double digits and at the same time have a low market capitalization.

These stocks have a lot of potentials to give multifold returns as their low valuations currently allow it. It is easier for Rs. 100 cr company to double its valuation than for Reliance an Rs. 1,622,823 cr company to double its valuation.

And hence this potential attracts a lot of investors but it is noteworthy that these companies bring with them a lot of risks and are generally avoided particularly for their volatility.

Often most of the penny stocks have proven to be wealth destroyers with only a selected few turning out to be multibaggers.

Our Top Pick for Best Penny Stocks in India for 2022

Best Penny Stocks in India 2022 #1 – Auro Labs

Auro Laboratories Limited | Best Penny Stocks in India 2022
Face Value (₹): 10ROE (%): 28.67
Market Cap (Cr): ₹60.99CrNet Profit Margin: 13.23%
EPS (₹): 6.27Current Ratio: 3.08
Stock P/E (TTM): 15.61Debt to Equity: 0.11
Dividend Yield (%): 0.00Promoter’s Holdings (%): 51.99%

Founded in 1989, Auro Laboratories manufactures APIs and specializes in diabetes therapy. They also undertake custom manufacturing of API’s and intermediaries on a contract basis.

Some of their key APIs include Metformin Hydrochloride, Chlorzoxazone, and Chlorphenamine Maleate. Here Metformin Hydrochloride accounts for 90% of its income.

The company has only one manufacturing unit located in Tarapur which has a 500-tonne capacity. Its products are exported to countries like Egypt, Germany, Malaysia, Singapore, South Africa, Brazil, Spain, and the United Kingdom.

The company is currently undertaking expansion plans which cost Rs. 12.5 cr. in order to increase capacity. 

The company currently has a Mcap of Rs. 60 crores and its shares trade at Rs. 97. The company’s revenues have increased continuously from Rs. 27 cr in 2018 to Rs. 54 crores in 2021.

Its net profit growth for the last 3 years averages 26.7%. The company comes with a high promoter holding of 51.99% with no pledged shares and also has a low debt with a debt-equity ratio of 0.11.

It has a good current ratio of 3.08. Its shares trade at a low PE of 15.61 in comparison to the industry PE of 21.

Best Penny Stocks in India 2022 #2 – Generic Pharmasec Ltd

Generic Pharmasec Limited | Best Penny Stocks in India 2022
Face Value (₹): 1ROE (%): 6.08
Market Cap (Cr): ₹172CrNet Profit Margin: 5.90%
EPS (₹): 0.08Current Ratio: 3.74
Stock P/E (TTM): 78Debt to Equity: 0.00
Dividend Yield (%): 0.00Promoter’s Holdings (%): 59.96%

Founded in 1992, Generic Pharmasec Ltd is engaged in the buying, selling, and distribution of pharma, medicinal, and medicated preparation. In addition to this, the company also deals in the securities market. 

Its products include Diagnostic Equipment, pharmaceutical medicinal and medicated preparations, patent medicines, drugs, herbs, etc.

They have tied up with Abbott Point of Care, the USA for the distribution of one of their niche diagnostic equipment called the i-STAT 1 Analyze.

This is a handheld blood analyzer used in ICUs in order to aid them to get immediate test results. Over the next 2 years, the company plans to expand across the 4 metros and also widen its product portfolio. 

The company currently has a Mcap of 176 crores and its shares trade at Rs. 6.24. The company’s revenues have increased from Rs. 38 lakhs in 2018 to Rs. 21.31 crores in 2021.

Its net profit growth for the last 3 years averages 193.18%. The company is also confident of increasing their sales by over 50% this financial year.

The company comes with a high promoter holding of 59.96% with no pledged shares and also has zero debt. It also has a good current ratio of 3.74. It however currently trades at a high PE of 78 which is way higher than the industry PE. 

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Best Penny Stocks in India 2022 #3 – Ashapuri Gold Ornament Ltd. 

Ashapuri Gold Ornament Limited
Face Value (₹): 10ROE (%): 4.16
Market Cap (Cr): ₹179.74CrNet Profit Margin: 1.79%
EPS (₹): 1Current Ratio: 27.28
Stock P/E (TTM): 70.48Debt to Equity: 0.00
Dividend Yield (%): 0.00Promoter’s Holdings (%): 62.17%

Founded in 2008, Ashapuri Gold Ornament Ltd. is engaged in the business of wholesale trading of jewellery. They offer 22-carat gold ornaments.

Its products include choker sets, Toda sets, Pota jewellery, Saloya, bracelets, and other antique jewellery. However, what’s interesting here are their clients.

Ashapuri Golds cater to clients from the high-end market segment to the mid-market value segment. Their client portfolio includes the likes of Malabar Gold, Titan, etc. 

The company currently has a Mcap of 179 crores and its shares trade at Rs. 73.5. The company’s revenues have increased continuously from Rs. 37 cr in 2018 to Rs. 118 crores in 2021.

Its net profit growth for the last 3 years averages 231.5%. The company comes with a high promoter holding of 62.17% with no pledged shares and also has zero debt. It has a current ratio of 27.28.

Bonus Share

The Below company proves to have good prospects in the industry but did not make the list as it shares trade in triple digits despite being a very small-cap stock.

Ksolves India Ltd. 

Ksolves India Limited

Founded in 2014, Ksolves India Ltd. is an IT company engaged in the business of software development, enterprise solutions, consulting, and other IT solutions.

Ksolves designs develop and maintain software systems in addition to creating and modifying existing products in order to improve their functionality!

They provide their services to companies in the Real Estate, E-commerce, Finance, Telecom, and Healthcare sector. The company works on technologies like AI, AR and VR, IoT iOS, and android apps. Their major clients include  

  • Onpoint Group
  • Sharemeister
  • Knight Broadband
  • Ekogenio
  • CountAbout
  • Cut Yeti
  • Hardy Nutritionals

In addition to this, the company also has entered into strategic partnerships with Salesforce, Adobe, Odoo, and Drupal Association. In the coming years, the company plans to offer services in AI, Machine learning, Big Data, etc.

They also plan to open onshore delivery centers in North America and Europe. Its promoter holding currently stands at 62.45%. The company has a PE of  33.83 and comes with zero debt. 

In Closing 

These were our top picks for penny stocks however one should always perform their own research before entering these stocks. A note of caution once again, these stocks are inherently riskier than large-cap and mid-cap stocks.

Generally one should not invest more than 5% of his/her portfolio into these stocks. That’s all for this post “Best Penny Stocks in India 2022” Let us know what you think and your favourite penny stocks in the comments below. Happy Investing!

Frequently Asked Questions (FAQs)

  1. Which are the best penny stocks to buy in India?

Some of the best penny stocks that you can buy in India are Sinclairs Hotel & Resorts, Zee Media Corporation Limited, Jullundur Motor Agency, Indraprastha Medical Corporation Ltd, and Coffee Day Enterprises Ltd.

However, it is important that you do thorough research before you invest in any of these stocks or get help from your investment adviser.

  1. What is the most successful penny stock ever in India?

Some of the most successful penny stocks in India are Eicher Motors (₹9 to ₹2,261), Kotak Mahindra Bank (₹1.8 to 1717.80), Lupin Limited (₹2 to ₹702.80), Titan Company Limited (₹2.6 to 2,390.00), Bajaj Finance (₹2.8 to 6,144 per share) and many others.

Please note that these shares gave huge returns over a number of years and not in short time spans.

  1. How do I choose penny stocks?

One of the best ways of choosing penny stocks that have the potential of giving good returns is by doing research about the company.

One can easily find companies that are trading below a given price and then find out businesses that are known if any, and then study these companies to buy a stock.

  1. What is the fastest growing penny stock?

Some of the fastest-growing penny stocks are RTCL, Tranway Technologies, Triveni Glass, Orosil Smiths India, Citizen Infoline, Swiss Military Consumer Goods, IL&FS Engineering and Construction, and Tine Agro.

  1. Which penny stock is fundamentally strong?

It is important to research companies before investing in them. We may mention a few companies, but information keeps changing from time to time.

Even if a company is fundamentally strong now, things might change in the near future, if something adverse about the company is discovered.

The fundamental strength of the company must be researched before buying/investing in the stock and investors have to stay updated about the companies that they have invested in from time to time.

You can now get the latest updates in the stock market on Trade Brains News and you can even use our Trade Brains Portal for fundamental analysis of your favourite stocks.

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