Best Penny Stocks in September 2024 Based on 5Y CAGR

Shares of companies with a value of less than ₹10 are considered penny stocks. Investors are attracted to this space due to their low prices and potential for growth. Penny stocks can give you a chance to invest in a company before it becomes widely recognised. Penny stocks are volatile. Their prices can swing dramatically in short periods due to their low trading volumes and market manipulation. In this article, check the top penny stocks in September 2024 on a 5Y CAGR basis.

Best Penny Stocks in September 2024 – Based on 5Y CAGR

Note: The best penny stocks provided here have been sorted based on 5Y CAGR and as of August 26, 2024

Overview of 5 Best Penny Stocks

1. Remedium Lifecare Ltd:Founded in 1988, Remedium Lifecare Ltd. is a pharmaceutical product trader that specializes in Advanced Pharmaceutical Intermediates. To acquire technology for producing lithium carbonate in India, the business recently entered into a strategic agreement with Angel Partners, Ltd., UK, which will take effect on July 29, 2024. A yearly supply agreement was also inked with Alfa Chemicals and Solvents Ltd in Turkey.

Key Metrics:

• Return on Equity (ROE): 123%
• Return on Capital Employed (ROCE): 99.5%

2. Prakash Steelage Ltd: Prakash Steelage Ltd was founded in 1996 and produces and distributes stainless steel pipes and tubes. Regarding operations, the company’s net revenue on a stand-alone basis was ₹9,657.20 lakh, up from ₹8,573.75 lakh the year before. In comparison to the previous year’s net profit after tax of ₹16,350.41 lakh, the company has gained a net profit after tax of ₹414.61 lakh.
3. Integra Essentia Ltd:Integra Essentia Ltd was founded in 2007 and operates in the areas of infrastructure, energy, clothing (textiles and garments), and food (agro products). Integra Essentia has successfully obtained a substantial order of ₹280 million for its infrastructure and agrobusiness divisions. This order demonstrates the steady faith that its clients have in the company’s goods and services.

Key Metrics:

• ROE: 16%
• ROCE: 17.2%

4. Standard Capital Markets Ltd: Standard Capital Markets Ltd is a non-banking financial company that was founded in 1987. To improve financial inclusion in rural India, Standard Capital Markets Limited has partnered with Paisalo Digital Limited, a forward-thinking financial services provider. This investment demonstrates SCML’s dedication to upgrading cutting-edge solutions that close the wealth gap and foster economic development in neglected areas.

Key Metrics:

• ROE: 6.88%
• ROCE: 8.18%

5. Sunshine Capital Ltd:Sunshine Capital Ltd was founded in 1989 and engages in investment, share trading, and finance. The business recently paid off all of its debt. This accomplishment is the result of money raised via a preferential issuance of equity shares. Its financial position has improved due to this calculated action, giving it a strong base for future growth and expansion.

Key Metrics:

• ROE: 1.33%
• ROCE: 0.25%

Factors To Consider Before Investing in Penny Stocks

1. Extreme Volatility and Low Liquidity:  Penny stocks are known for their extreme volatility. Due to their small trading volumes and market manipulation, their prices can fluctuate significantly in brief periods of time. If the market moves against you due to this volatility, you could suffer sudden, significant losses.
2. Lack of Transparency: Many penny stocks are traded on over-the-counter markets, where regulatory monitoring is laxer. Because of the potential lack of regulation, it may be difficult to find trustworthy financial data, which makes determining a firm’s stability and real worth difficult.
3. Fraud and Manipulation: Penny stocks are vulnerable to fraudulent schemes like “pump-and-dump” operations, where the stock price is artificially boosted by deceptive advertisements before insiders sell off their shares at a profit. This is because there is little regulation and monitoring around penny stocks.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.