Penny stocks have become the hottest talks of the stock market because of the low-price and high-profit mantra they follow. Because they are priced very low, they are highly preferred by low-budget investors. Although there are a plethora of penny stocks out there, not all of them are worth putting your money in. This is the reason why we have created this list of best shares below 20 Rupees. All of these shares are expected to become multibagger in the coming years and have the potential to offer the highest returns in less time. Keep reading to know more!
Best Stocks Under Rs 20 to Invest
| S No | Top Stocks Under Rs 20 | Industry |
| 1 | Reliance Home Shares | Banks |
| 2 | Vodafone Idea Ltd | Telecomm-Service |
| 3 | Jaiprakash Power Ventures Ltd | Power Generation & Distribution |
| 4 | Reliance Power Ltd. | Power Generation & Distribution |
| 5 | UCO Bank | Banks |
| 6 | SEPC | Banks |
Overview of Stocks Under Rs 20
Yes Bank Ltd
Yes Bank is a well-known private bank in India, which is based out of Mumbai. Its founders are Ashok Kapoor and Rana Kapoor, while Prashant Kumar is the notable CEO. It was a good quality stock that was priced around Rs. 200 once. However, the stock price came down as the bank lost its reputation because of bad loans and scams that surfaced in the media a couple of years back.
After that, the RBI took control of Yes Bank due to a huge volume of bad loans. As a result, today, approximately 30% of shares of YES Bank are owned by RBI. The market cap of the company stands at Rs 38,835 Cr and its current price is Rs. ~16.15
Vodafone Idea Ltd
This is another great share under 20 Rs, you can consider buying. Vodafone Idea Limited is a well-known telecommunications company in India based out of Mumbai. It was established back in 2018 by Kumar Mangalam Birla and Ravinder Takkar has been named the latest CEO of the company.
This is a child company or a joint venture of the Aditya Birla Group and Vodafone Group. There are around 13,000 employees in the company and it has a market cap of ~Rs 27,461cr. After Vodafone Idea Ltd converted its AGR and deferred interest into equity, the Government purchased 35.8% of its stakes.
Currently, it is the most popular stock under 20 Rs and is expected to become a multibagger stock in the future.
Indian Overseas Bank
The next best share under 20 Rupees is Indian Overseas Bank with a price of ~Rs. 19.40. It is one of the oldest private banks in India established by Shri. M.Ct.M. Chidambaram Chettiar in 1937. Its headquarters are located in Chennai and it operates in four countries, namely Singapore, Sri Lanka, Thailand, and Hong Kong. Know that the parent company of this bank comes under the Ministry of Finance of India. The market capitalization of the bank stands at Rs 36,670Cr and is placed on the top of 20 Rupees share list
Suzlon Energy
Perhaps the most anticipated shares under 20 Rupees is Suzlon Energy. This wind and clean energy company were established by Tulsi Tanti in 1995. Interestingly, it operates in around 17 countries all across the globe including Europe, Asia, Africa, Australia, and America. The headquarters of the company is located in Pune and its market cap stands at ~Rs 10,039cr. It is another great stock below 20 Rs you can consider investing in.
Jaiprakash Power Ventures Ltd
The next penny stock on our list of best shares under 20 Rs is Jaiprakash Power Ventures Ltd. The company deals in coal mining, cement, and power generation. Established in 1994, it is a part of the reputed Jaypee Group. Further, the chairman of the company is Mr. Manoj Gaur and the organization has a strong presence across states like Madhya Pradesh, Himachal Pradesh, and Uttar Pradesh.
Reliance Power Ltd
One of the safest stocks below 20 Rs is this one. Reliance Power Ltd is a part of Reliance Group headed by Anil Dhirubhai Ambani. It is the largest and most established power generator in the sector. The company has its headquarters in Mumbai and K Raja Gopal has been named as its CEO. Note that the company was set with an aim to develop as well as operate both national and global power plants. It has a market cap of ~Rs 5,440cr and its competitors include giants like Adani Group. This is one of the best shares below 20 rs, you can think of investing
UCO Bank
The next best share under 20 Rs is UCO Bank. Formerly known as United Commercial Bank, UCO bank was founded in 1943 by GD Birla. It has nearly 22,000 workers and is headquartered in Kolkata, West Bengal.
The parent organization of the bank is the Ministry of Finance as the government owns nearly 95.37% of the total stakes of the company. The market cap of the bank stands tall at ~Rs 17,276Cr and its current share price is ~Rs. 14.40.
Punjab and Sind Bank
If you’re searching for reliable stocks below Rs 20, you can consider investing in the shares of Punjab and Sind Bank. It is the oldest bank in India founded by Bhai Vir Singh with an aim to uplift poverty from the poorest regions of the country. This bank was established with a social commitment. Their goal was to assist the poor in their financial endeavor to improve their standard of living. The market cap of the bank is ~Rs.11,590 Cr.
So, these were the best stocks under 20 Rs. Now, let’s take a look at some of the important factors to consider at the time of buying below 20 Rupees shares in India.
Things to Consider While Choosing the Stocks Under Rs 20
One of the most important factors to consider while buying shares below Rs 20 is – risk!
Although all the stocks we’ve discussed above have resulted in mass gains for investors in the past few years, they are still prone to market risks. In the market downturn, some of these stocks can show poor performance. Moreover, liquidity is another concern with these stocks.
Other important factors you should consider include timing, investment horizon, and the amount you want to invest. It is recommended to invest in these stocks for a very short term and exit them soon after making your profits.
Conclusion
Timing is undoubtedly the most important factor to keep in mind when investing in penny stocks. You need to pick your stocks very carefully after performing thorough research and analysis. The right stock, picked at the right time can help you make massive gains in a short time, while the opposite can eat your invested money. If you’re investing in stocks below Rs. 20, then make sure to invest just 10% of your total amount. This will keep your portfolio diversified and will also help in managing the risks.
This is not an investment advisory. The blog is for information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, goal, time frame, risk and reward balance, and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs. The performance and returns of any investment portfolio can neither be predicted nor guaranteed.
Can beginners invest in shares below 20 Rupees?
Yes, beginners can surely invest in shares below 20 Rupees. However, don’t get intimidated by the cheap price and invest all your money in these semi-penny stocks. It can have adverse effects on your portfolio because of the risks these stocks carry. Instead, consider investing not more than 10% of your portfolio in these stocks.
Are shares under Rupees 20 risky?
All penny stocks carry some degree of risk. So, yes, shares under Rupees 20 can be risky. However, they have the potential to offer high gains in less time. So, mindfully investing in them can help you reap maximum profits. Note that your final investment decision should be based on your risk tolerance.