Best Stock to Invest Under Rs.20

The finest stocks to purchase under Rs.20 in 2024 might change the game for wise investors. This article explores the top stocks to invest under Rs.20 in 2024, focusing on the Indian stock market's growth potential and the potential for finding high-potential stocks at low prices. It highlights the appeal of these stocks to investors, even retail investors. Let’s understand stocks to invest under  Rs.20 in 2024 with its important factors, advantages and risks.
 

Stocks Below Rs.20

The top stocks to purchase under Rs.20 refer to publicly traded firms' stock shares that are selling for less than Rs. 20 per share. These equities, also referred to as "penny stocks" or "small-cap stocks," allow investors to obtain exposure to high-growth prospective firms at a relatively modest entry cost. While these companies may be riskier than their larger-cap peers, they also have the potential for considerable capital gain, making them an appealing prospect for investors with a higher risk tolerance and a long-term investment strategy.
 

 

Top 10 Stocks Under Rs.20  in 2024:

Below is a list of top 10 stocks under Rs 20 in 2024. Take a look before making any further investment:

Company NameIndustryCMP in RsMarket Cap in Cr RsP/E Ratio 52-Week High 52-Week Low
Mishtann Foods LimitedFMCG - Foods17.91,9035.526.49.54
M K Proteins LimitedFMCG - Households12.245840.833.49.45
Goldstar Power Limited Batteries14.434785.623.44
G G Engineering Limited  Auto Parts 2.0524033.82.970.92
Rajnandini Metal LimitedMetals Diversified10.529119.121.48.50
Sanmit Infra LimitedReal Estate14.322650.594.710.3
Madhav Infra Projects LimitedConstruction and Engineering10.829213.5155.17
DRC Systems India LimitedAdvertising30.139834.233.711.7
Maximus International Limited Commodities Trading 19.224430.930.413.4
Bodhi Tree Multimedia LimitedMovies & TV Series14.518053.223.510.3

Disclaimer: All the information mentioned above is accurate as of 26th June 2024. However, it is important to conduct research before making any investment decisions in these stocks
 

Overview of Stocks Under Rs.20

Following is the overview of stocks under Rs 20 in 2024:

Mishtann Foods Limited

Mishtann Foods Limited was incorporated in 1981 and does manufacturing and processing of rice, wheat, among others. The company is involved in the business of processing and packaging of fast moving consumer goods. 

  • Mishtann Foods has reduced debt.
  • The company is almost debt free.
  • The company's median sales growth is 98.1% of last 10 years

M K Proteins Limited

M K Proteins Limited was established in 2012. The company is engaged in manufacturing, trading, and production of edible oils.

  • M K Proteins has reduced debt.
  • The company has delivered sales growth of 9.39% over the past five years.

Goldstar Power Limited

Goldstar Power Limited was incorporated in 1999. The company manufactures batteries and battery products.

  • Goldstar Power has delivered a sales growth of 6.64% over the past five years.

G G Engineering Limited

G G Engineering Limited incorporated in 2006 is in the business of trading of iron and steel metals.

  • G G Engineering is almost debt free.
  • The company is trading at 1.17 times its book value
  • The company has delivered good profit growth of 25.7% CAGR over the last 5 years

Rajnandini Metal Limited

Rajnandini Metal Limited incorporated in 2010 is in the business of manufacturing, trading, and dealing in high-grade Copper Continuous Casting Rods and copper wires.

  • Rajnandini Metal has delivered good profit growth of 70.8% CAGR over last 5 years
  • The company has a good return on equity (ROE) track record: 3 Years ROE 35.7%.

Sanmit Infrastructure Limited

Sanmit Infra Limited established in 2000 is in the business of petroleum products, trading and realty and infrastructure business.

  • The company has delivered a sales growth of 4.28% over the past five years.

Madhav Infrastructure Projects Limited

Madhav Infra Projects Limited incorporated in 2010 is in the business of infrastructure development and solar power generation.

  • Madhav Infra Projects has reduced debt.
  • The company has delivered a good profit growth of 35.0% CAGR over the last 5 years.

DRC Systems India Limited

DRC Systems India Limited incorporated in 2012, is an IT services and Consultancy company.

  • DRC Systems India is almost debt free.
  • The stock  is trading at 8.33 times its book value.

Maximus International Limited

Maximus International Limited established in 2015 is a manufacturer and distributor of lubricants, lube base oils, and other petrochemical products used in industries such as automotive, metalworking, refrigeration, electrical, paint and ink industries.

  • Maximus International has delivered good profit growth of 33.5% CAGR over the last 5 years.

Bodhi Tree Multimedia Limited

Bodhi Tree Multimedia Limited incorporated in 2013 provides television content and Internet based programs.

  • Bodhi Tree Multimedia is expected to give a good quarter.
     

Factors To Consider Before Investing in Shares under Rs.20

Here are some factors that you should consider before investing in shares under Rs.20:

  1. Company basics: The first factor to analyse is the company's financial health and fundamentals. Look for organisations with a solid financial sheet, solid revenue growth, and a bright future.
  2. Market circumstances: It should be considered before investing in any stock. Research current market trends, rivals, industry trends, and economic circumstances.
  3. Risk appetite: Investing in equities under ₹20 might be dangerous due to their high volatility. So, before making any investment, you should consider your risk tolerance and investing objectives.
  4. Diversify portfolio: Diversification is essential in every investing portfolio. Invest in a diverse range of equities from various sectors and businesses to reduce risk and increase rewards.
  5. Long term investment: Investing in equities under ₹20 takes a long-term approach. The stock price may change in the near term, but if you have a longer time horizon, the stock has the potential to expand and provide larger profits.
     

Advantages of Investing in the Best Rs.20 Stocks

Investing in companies valued below Rs. 20 might provide various advantages, including:

  • Affordability: These equities are often seen as inexpensive, allowing investors with little funds to engage in the stock market. This accessibility allows people to construct a diverse financial portfolio.
  • Higher Volatility: equities priced below Rs. 20 are more volatile than higher-priced equities. While volatility can be risky, it also provides possibilities for possibly larger rewards. Investors who are ready to accept short-term price swings may benefit from the potential for large returns over time.
  • Increased Liquidity: Stocks priced below Rs. 20 may also get attention from regular investors and traders seeking market opportunities. Increased trading activity can help to improve liquidity in certain equities, allowing investors to purchase and sell shares more readily.
     

Risks of Investing in the Best Stocks Under Rs. 20

Investing in the top gainers' shares for less than 20 rupees may have substantial constraints. Let's look at some of them.

  • Limited Information: Companies with stock prices less than 20 rupees may not consistently publish appropriate information about their financial health and activities, potentially leading to investment decisions based on inadequate facts.
  • Risk of Delisting: Companies with continuously low share prices are at a higher risk of delisting because they may fail to fulfil stock exchange minimum price standards.
  • Susceptibility to Market Sentiment: Best stocks under 20 Rs. may be more vulnerable to market sentiment and speculative trading, resulting in unpredictable stock price changes unrelated to the company's fundamentals.
     

Conclusion 
The stock market is volatile and unpredictable, requiring careful research and understanding of market dynamics. Investing in ₹20 stocks can be risky due to their association with small or emerging companies with limited track records. Consult a financial advisor before investing and open a free Demat account with a reliable stock market app to explore various stocks in the market.

FAQs on Best Stocks to Invest Under Rs.20 in 2024

Stocks under Rs. 20 can be riskier due to volatility and lower liquidity; thorough research is essential before investing.

Analyse company financials, growth prospects, industry position, and recent news; consult stock analysis tools and expert opinions.

Significant returns are possible but not guaranteed; these stocks are often speculative and require careful selection and risk management.

Yes, diversification reduces risk by spreading investments across multiple stocks and sectors, minimising the impact of any single stock's poor performance.

Holding periods vary based on individual stock performance and investment goals; long-term holding may yield better results if the company grows.