A rising tide lifts all boats. The market rally over the past one year has seen 23 stocks that traded at Rs 10 or below on the BSE, zoom over 100 per cent during this period.
New Delhi – based Bampsl Securities tops the table with a gain of 718 per cent, followed by Daman & Diu – based Dolat Investments Ltd that has surged 602 per cent to Rs 17.5 levels, ACE Equity data shows. These stocks traded at Rs 0.23 and Rs 2.5 levels, respectively a year ago. In comparison, the S&P BSE Mid-cap and S&P BSE Small-cap indices have moved up around 12 per cent and 17 per cent, respectively during this period.
Though most analysts remain bullish on the road ahead for the markets, they caution against volatility and suggest investors look at company’s fundamentals before taking an investment call, especially in the mid-and small-cap segment which is prone to price manipulation / stock price rigging.
“The trend is not surprising. A lot of penny stocks rally in a bull market and the euphoria fizzles out soon after. That apart, penny stocks could be prone to price manipulation as well. Investors will be better off analysing parameters like earnings track record, quantum of fixed assets, promoter stake and floating stock before investing,” says G Chokkalingam, founder and managing director, Equinomics Research.
RMG Alloy Steel, Confidence Petroleum India, Urja Global, Paramount Communications, Ritesh International, Rama Vision, Prima Industries, Marg Ltd, GVK Power & Infrastructure and Modern Steels are some of the other counters that have appreciated between 100 per cent – 445 per cent during this period.
As regards investing strategy, Deepak Jasani, head of retail research at HDFC Securities cautions that there are midcaps which are running up to catch up on valuation with peers without a commensurate improvement in fundamentals. “In such cases, investors have to be careful, as these stocks would fall the most in case the sentiment turns adverse,” Jasani says.
Meanwhile, GVK Group is in talks to sell two of its gas-based power projects with 684 Mw combined installed capacity to Andhra Pradesh power utilities to settle debt of around Rs 18 billion through a one-time settlement, reports suggest. Unavailability of natural gas rendered the two plants unusable and have been adding to the group’s losses for the past few years.
|RISE AND SHINE|
|Company||Price on BSE (Rs)||Change (%)|
|Bampsl Securities Ltd.||1.85||718.3|
|Dolat Investments Ltd.||17.54||601.6|
|RMG Alloy Steel Ltd.||23.45||445.3|
|Confidence Petroleum India Ltd.||48.05||444.8|
|Urja Global Ltd.||4.26||290.8|
|Paramount Communications Ltd.||13.95||282.2|
|Ritesh International Ltd.||20.71||262.1|
|TRC Financial Services Ltd.||23.80||254.7|
|India Finsec Ltd.||31.50||238.0|
|Lesha Industries Ltd.||7.00||234.9|
|Rama Vision Ltd.||25.85||220.3|
|Astro Bio Systems Ltd.||3.20||213.7|
|Shalimar Wires Industries Ltd.||25.20||209.6|
|Prima Industries Ltd.||14.70||189.9|
|Ishaan Infrastructures & Shelters Ltd.||25.15||151.5|
|Chennai Ferrous Industries Ltd.||14.62||141.3|
|GVK Power & Infrastructure Ltd.||13.13||137.9|
|Magnum Ventures Ltd.||7.81||133.1|
|Sanwaria Consumer Ltd.||14.05||129.8|
|Super Bakers (India) Ltd.||11.80||121.4|
|Calcom Vision Ltd.||12.40||115.7|
|Modern Steels Ltd.||11.45||100.9|
|Source: ACE Equity data|
|Price is latest available pricetill May 25|