In this article, you will know about 3 penny stocks list whose price is less than ₹ 70 and which are trading less than their book value. So if a stock is trading below its book value which is very rare, most of the good stocks are trading 10 to 20 times higher than their book value.
But if this happens then it means that you are getting that stock cheaply and there are many chances of increasing its price.
Multibagger penny stocks list – Fundamental analysis
Ircon International Limited
The number one stock is Ircon International Limited. This company was started in 1976 in the form of Railway Construction Company, since then its business has been greatly diversified and now it is an integrated Engineering & Construction PSU which works especially on large and technologically complex infrastructure projects like Railways, Highways, etc.
It is the only public sector undertaking in India that comes in the top 250 international contractors, it also provides project management, consultancy, engineering, construction, public-private partnership projects, and real estate services.
This company also works on the project of the National Highway Authority of India and it also has many international clients, 80.98% of its revenue comes from the railway sector and the remaining 18.32% revenue comes from the highway sector.
Their headquarter is in New Delhi and there are 38 project offices and 4 regional offices all over India.
It has 5 ongoing overseas projects in Sri Lanka, Bangladesh, Malaysia, South Africa, and Algeria and has completed 390+ projects in India and 128 projects in 25 countries.
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Fundamentals of Ircon International Limited
It is also a small-cap company and its market capitalization is 4317 crores, its return on equity average is 9.03%, return on capital employed is also 13.4% which is assumed to be average.
Debt: This company has a debt of Rs 943 crore while its annual profit is 391 crore and this company also has a free cash flow of 534 crores. The debt to equity ratio of the company is 0.21 which is much less than 1.
The earning per share of the company is ₹ 5.18 which is good according to its price and the holding of promoters in the company is 73.2%.
This stock is also trading less than its book value, its book value is 48.60 whereas now its one share price is running at Rs 46.00.
Pros of Ircon International Limited
This stock is trading below its book value, it is expected that this company can give good quarter results. And this company gives dividend of 42.38%.
Cons of Ircon International Limited
The return on equity of the company for the last three years is 10.58%.
Financial trend of Ircon International Limited
Till 2020, the profit of the company was increasing continuously but in 2021 there has been a little less profit of 391 crores.
Quarterly Profit: Compared to last year’s quarter 2, the company has made more profit in the quarter 2 of this year than 126 crores.
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Texmo Pipes & Production Limited
The second stock is Texmo Pipes & Products Limited. This company manufactures pipes and fittings. Their product portfolio includes PVC pipes, HDPE Pipes, SWR Pipes, Rigid PVC Pipes, Submersible Column pipes, Casting Pipes, Agricultural fittings, HDPE Coils, DUCT, Sprinkler Pipes & Fittings, Solvent Cement, etc.
So basically this company makes products related to plumbing and their clients are big companies like Indian Railways, BSNL, Power Grid Corporation of India, TATA Power, etc.
Revenue of Texmo Pipes & Production Limited
Revenue of Texmo Pipes & Production Limited: The company generates 49.05% revenue from HDPE pipe, 30.16% revenue from PVC pipe, 9.1 2% revenue from molding fittings, 4.50% revenue from trading sales, and 2.22% revenue from CPVC fittings.
The company has its manufacturing facility in Madhya Pradesh with a capacity of 2500 tonnes per annum and has branch offices in more than 7 states.
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Fundamentals of Texmo Pipes & Production Limited
The company’s market capitalization is 207 crores, its return on equity is 4.96% and return on capital employed is 9.13%, their returns are low.
Debt: This company has a debt of Rs 12.6 crores while its annual profit is 10.8 crores and this company also has a free cash flow of 24.8 crores.
If its debt to equity is 0.05 then it can be considered debt-free.
EPS: It’s earning per share is Rs 5.67 which is good according to its price and promoters holding in the company is 44.2%.
The book value of this stock is ₹80.8 and the current price of one share is ₹70.80. So this stock is trading below its book value.
Pros of Texmo Pipes & Production Limited
This company has reduced its debt and this company is almost debt-free. This stock is trading less than its book value, this company can give good quarters result with last five-year profit growth CAGR of 29.09%. The debtor of the company has improved from 53.85 to 38.54.
Cons of Texmo Pipes & Production Limited
This company does not pay a dividend and its return on equity for the last three years is also low at 2.89%.
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Financial trend of Texmo Pipes & Production Limited
The company had a loss of 1.34 crores in 2017 but since 2018 its profit is increasing continuously and in 2021 it has made a profit of 10.38 crores.
Quarterly Profit: So in comparison to last year’s Quarter 2 (September 2020), there has been more profit of 4.85 crores than this year’s Quarter 2.
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PTL Enterprises Limited
The third number stock is PTL Enterprises Limited. It is a tyres manufacturing facility leased to Apollo tyres Company and is a production by Apollo tyres Company.
This is a small-cap company and its market capitalization is Rs 426 crore, its return on equity average is 8.81%, return on capital employed is also 11.6% which is assumed to be average.
Debt: This company has only a debt of 52 crores while its annual profit is 70 crores and this company also has a free cash flow of 57.8 crores. Its debt is less than its annual profit, so we will consider it debt-free.
The debt to equity ratio of the company is also 0.09, it’s earning per share is Rs 2.92 which is good according to its price and the promoters’ holding in the company is 69.8% which is considered good.
The book value of this stock is Rs 45.5 while the current price of one share is Rs 32.10.
Pros of PTL Enterprises Limited
This company is almost debt-free. This stock is trading less than its book value, its dividend yield is good at 7.76% and its dividend payout is also 42.15% which is considered good.
Cons of PTL Enterprises Limited
The company has had low sales growth for the last five years and its return on equity for the last three years is also low at 8.79%.
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Financial trend of PTL Enterprises Limited
The company had a profit of 30.29 crores in 2017, a profit of 45.83 crores in 2018, a profit of 39.85 crores in 2019, and a profit of 43.94 crores in 2020.
The company’s profit is maintained and in 2021 the highest profit is 70.04 crores.
Quarterly Profit: In September 2021, the company has made the highest profit of 12.06 crores, the company’s profit is also increasing.
What is book value?
Book value means that if all the assets of a company are sold (its machines, properties, etc.) and if there are any liabilities on it, then it should be paid and after that, the amount left with that company is its book value.
And if we have calculated book value per share then it has to be divided by the number of shares, example if a company has assets of 100 crores and liabilities of 10 crores on it then its book value will be 100 – 10 = 90 crores.
That is, the book value of that company will be 90 crores, now suppose if it has issued 1 crore shares then its book value per share will be 90 crores divided by 1 crore = ₹ 90.
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This article is only for education purpose and the author has his own views and research, so if you invest in these stocks then do it at your own risk and do the research yourself before investing.
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Penny Stocks list: FAQ
Book value means that if all the assets of a company are sold (its machines, properties, etc.) and if there are any liabilities on it, then it should be paid and after that, the amount left with that company is its book value.
This company was started in 1976 in the form of Railway Construction Company, since then its business has been greatly diversified and now it is an integrated Engineering & Construction PSU which works especially on large and technologically complex infrastructure projects like Railways, Highways, etc.
Till 2020, the profit of the company was increasing continuously but in 2021 there has been a little less profit of 391 crores.
Quarterly Profit: Compared to last year’s quarter 2, the company has made more profit in the quarter 2 of this year than 126 crores.
The company had a loss of 1.34 crores in 2017 but since 2018 its profit is increasing continuously and in 2021 it has made a profit of 10.38 crores.
Quarterly Profit: So in comparison to last year’s Quarter 2 (September 2020), there has been more profit of 4.85 crores than this year’s Quarter 2.
The company had a profit of 30.29 crores in 2017, a profit of 45.83 crores in 2018, a profit of 39.85 crores in 2019, and a profit of 43.94 crores in 2020.
Quarterly Profit: In September 2021, the company has made the highest profit of 12.06 crores, the company’s profit is also increasing.