Last Updated on 2 weeks ago by Raj Kumar

What is a Penny stock

Penny is often referred to something which is very cheap to afford. So the stocks which are very low in stock price are know as Penny stocks.

The term ‘Penny stocks’ has originated from the west. A penny stock refers to a small company’s stock that typically trades for less than $5 per share. In the grand old days, Penny stocks were the stocks which traded below $1 per share but SEC (Securities and Exchange Commission) has changed the definition to include shares up to $5 to be called a Penny stock.

History of Penny Stocks

As per NASDAQ ; In the non-digital era, persons buying a stock were paying up as much as a quarter-point ($0.25) commission to buy or sell a share of stock regardless of the stock price whether its a $1 stock or a $100 stock.

So the Mutual funds at that time avoided buying Penny stocks to avoid the huge commission. This became a widespread notion to avoid the types of stocks to save on the commission.

Have a look at India’s famous investor’s portfolios here:-

Rakesh Jhunjhunwala Portfolio

Radhakishan Damani Portfolio

Porinju Veliyath portfolio

Vijay Kedia stocks portfolio

Nemish Shah stocks portfolio

Mohnish Pabrai Stocks Portfolio

Ashish Kacholia stocks portfolio

Dolly Khanna portfolio

What is penny stocks in India?

Although there is no definition of penny stock in India as a general consensus in Indian stock markets, any stock that trades below Rs 50 is considered as Penny stock in India. These stocks are generally volatile with their stock price, il-liquid, and have got stock market operator’s involvement.

Although many retail investors try to stick to Blue chip stocks India for their investment preference and look for mainly zero debt companies to find safe heavens but recently its seen that there is an appetite to take risks and invest in Penny stocks in India. We will only look at the stocks which have stock prices higher than Rs 1.

You need to be extremely careful while investing in these types stocks as they are highly risky and you may lose your entire capital. History shows that investing in stocks just because they are available under Rs 50 doesn’t mean that the stock will give higher returns.

Full list top 100 best penny stocks to buy in India – NSE / BSE – October 2021

COMPANY / STOCK	SECTOR – INDUSTRY	Price	Market CAP (Rs Cr.)
Vodafone Idea	Telecommunications – Service	11.4	32,758
Indian Railway Finance Corporation Ltd.	Others	23.9	31,234
NHPC	Power Generation – Hydro	29.1	29,231
GMR Infra	Infrastructure – Diversified	41	24,747
Trident Ltd	Textiles – Furnishings/ Terry Towels	29.4	14,982
SJVN	Power Generation – Hydro	28.4	11,161
HUDCO	NBFC – Housing	44.65	8,938
NBCC	Construction & Contracting	48.2	8,676
Tata Tele	Telecommunications – Service	37.1	7,253
TV18 Broadcast	TV Broadcasting &  Software Production	41.55	7,123
MMTC	Trading	45.1	6,765
Rail Vikas Nigam	Construction & Contracting	30	6,255
RattanIndia Infra	Miscellaneous	43.8	6,054
Shree Ren Sug	Sugar	28	5,960
Suzlon Energy	Power Generation – Wind	6.5	5,749
Infibeam Avenues	Online Service/Marketplace	41.75	5,557
Hathway Cable	Cable/DTH	25.05	4,434
Ircon Intl.	Construction & Engineering	45.1	4,242
Dish TV India	Cable/DTH	20.2	3,719
Lemon Tree Hotels	Hotels & Resorts	45.6	3,613
HMT Ltd	Auto – Tractors	28.9	3,480
IFCI	Term Lending – General	13.05	2,665
RattanIndia Power	Power Generation – Thermal	4.35	2,336
Den Networks	Cable/DTH	48.45	2,312
GTL Infra	Telecommunications  – Allied Services	1.7	2,125
Bajaj Hindusthan Su	Sugar	16.05	2,050
Electrostl Cast	Castings/Foundry	37.15	1,608
Future Consumer	FMCG Diversified	7.6	1,510
IndiaPowerCorp	Power – Integrated	15.5	1,509
Jayaswal Neco	Castings/Foundry	23.55	1,504
Hind Const Co	Construction & Contracting	9.55	1,445
HBL Power	Industrial Consumable  – Others	48.05	1,332
TARC Ltd.	Others	43.45	1,282
DCW Ltd	Petrochem – Others	48.95	1,278
PTC Financial	Term Lending – Power	19.8	1,272
Centrum Capital	NBFC – Diversified	30.15	1,254
MTNL	Telecommunications – Service	19.1	1,203
Andrew Yule	Tea / Coffee	24.45	1,195
DiGiSPICE Tech	Telecommunications  – Allied Services	44.6	1,020
Patel Eng	Construction & Contracting	20.05	961
Texmaco Rail	Capital Goods – Railway	36.85	923
Zee Media Corp	TV Broadcasting &  Software Production	14.55	910
Music Broadcast	Radio Broadcasting  & Entertainment	24.1	833
Sadbhav Eng	Infrastructure – Roads/Tolls	48	824
HLV Ltd.	Hotels & Resorts	11.2	738
Arshiya	Warehousing/Supply Chain/ Road Transport	27.9	732
Snowman Logistics	Warehousing/Supply Chain/ Road Transport	43.15	721
Oriental Hotels	Hotels & Resorts	38.55	689
Coffee Day Ent	Restaurant & QSR	32.2	680
DB Realty	Real Estate	27.8	676
Nectar Lifesc	Pharma – Indian	29.65	665
Nagarjuna Fertilizer	Fertilisers	11	658
Orient Paper	Paper Manufacturer	30.8	654
Rico Auto	Auto Ancl – Dr. Trans & Steer  – Others	47.75	646
Parsvnath Dev.	Real Estate	14.75	642
Navkar Corp	Warehousing/Supply Chain/ Road Transport	41.45	624
HT Media	Print Media	26.3	612
Shriram EPC	Project Consultancy/Turnkey	6.3	612
B L Kashyap	Construction & Contracting	27	609
Oswal Green Tech	Financial Services – Misc	23	591
Gokul Agro Resources	Edible Oils & Solvent Extraction	43	567
Sadbhav Infra	Infrastructure – Diversified	16.1	567
Tilaknagar Ind	Beverages & Distilleries	39.05	544
Future Enterprises  (DVR)	Diversified	11.75	535
Andhra Cements	Cement – South	17.45	512
Oricon Enterpr	Diversified	31.8	499
Madras Fert	Fertilisers	30.5	491
Vascon Engineer	Construction & Contracting	25.85	481
Artemis Medicare Services Ltd.	Others	36	477
Zee Learn	Coaching/Study Material/Schools	14.25	465
HCL Infosystems	IT Networking Equipment	13.8	454
Marine Electricals	Electric Equipment/ Components/Services	36.9	453
Prozone Intu Proper	Real Estate	27.7	423
ISMT Ltd	Steel – Rolling	28.65	420
Sarla Perform	Textiles – Processing/ Texturising	49.35	412
Future Enterprises	Diversified	9	409
Pennar Ind	Steel – CR/HR Strips	28.75	409
Pudumjee Paper Prod	Paper Manufacturer	40.7	386
Stampede Cap (DVR)	Broking & Allied Services	16.6	380
MEP Infrastructure	Infrastructure – Roads/Tolls	20.65	379
Rana Sugars	Sugar	24.65	379
MSP Steel	Steel – Sponge Iron	9.75	376
Peninsula Land	Real Estate	13.25	370
Trans & Rectif	Power –  Transmission Equipment	26.95	357
Vipul Ltd	Real Estate	29.5	354
Urja Global	Project Consultancy/Turnkey	6.25	348
Orient Abrasive	Abrasives And  Grinding Wheels	28.85	345
McLeod Russel	Tea / Coffee	32.95	344
Birla Tyres	Tyres & Tubes	24	76
Ashima Ltd	Textiles – Spinning –  Cotton Blended	17.75	340
Ugar Sugar Work	Sugar	30.2	340
Suvidhaa Infoserve Ltd.	Others	15.9	323
Hind Nat Glass	Glass – Consumer	36.05	323
Vikas Multicorp	Miscellaneous	3.4	316
PTL Enterprises	Holding – Diversified	46.95	311
Shyam Century Ferro	Ferro Alloys	13.95	310
Lloyds Steels	Steel – Others	3.35	301
Commercial Engg	Miscellaneous	33.4	299
Shree Rama News	Paper Manufacturer	19.6	289
Airan Ltd.	IT Enabled Services	22.2	278

The above list is not the complete list of Penny stocks; there are 500+ companies in NSE / BSE with stock prices less than Rs 50. We only picked stocks having higher market cap.

FAQ on Penny stocks in India