What do we mean by excellent penny stocks?
Envision organizations with fair deals and benefit development throughout recent years. Organizations which have great return proportions and have shown consistency in their profit payouts.
You need to see an organization that has been around for some time and has a background marked by income development, as well as fair net revenues.
In this way, remembering that, we feature the best five top notch penny stocks in India.
These stocks are shortlisted utilizing Equitymaster strong Indian stock screener.
#1 HUDCO
First on the rundown is HUDCO.
Lodging and Metropolitan Improvement Enterprise (HUDCO)is a public restricted organization (Legislature of India undertaking). Being significantly claimed by the middle, the organization gets support as far as board portrayal and admittance to minimal expense reserves.
The organization is principally participated occupied with supporting lodging and metropolitan advancement exercises in the country.
Throughout the long term, HUDCO plays had a critical impact in the execution of its different drives in metropolitan framework and social lodging projects.
The organization’s openness to metropolitan framework is ascending in accordance with thegovernment’s expanded concentration towards infrastructuredevelopment. This is a major upside for HUDCO, which assents credits under different framework plans.
Coming to its financials, for the year finished Walk 2022, HUDCO detailed an independent benefit after duty of ₹17,166 million (m). This contrasts and 2021’s benefit of ₹15,786 m.
HUDCO’s productivity was affected in Coronavirus years (2020 and 2021) however it worked on in 2022 and came to pre-Coronavirus levels.
For the nine months finished December 2022, HUDCO has revealed a benefit of ₹10,624 m.
View the table beneath which shows the organization’s monetary presentation for the beyond five years.
HUDCO Financial Snapshot (2018-2022)
| ₹m, standalone |
FY18 |
FY19 |
FY20 |
FY21 |
FY22 |
|---|---|---|---|---|---|
| Revenue |
41,714 |
55,559 |
75,321 |
72,355 |
69,544 |
| Growth (%) |
18% |
33% |
36% |
-4% |
-4% |
| Operating Profit |
37,089 |
49,390 |
70,281 |
70,004 |
68,864 |
| OPM (%) |
89% |
89% |
93% |
97% |
99% |
| Net Profit |
10,102 |
11,802 |
17,084 |
15,786 |
17,166 |
| NPM (%) |
24% |
21% |
23% |
22% |
25% |
| Debt to Equity (x) |
3.65 |
5.45 |
4.98 |
4.62 |
4.25 |
| ROE (%) |
10.57 |
11.29 |
14.67 |
12.37 |
12.41 |
| ROCE (%) |
8.86 |
8.44 |
9.72 |
9.45 |
9.16 |
Data Source: Ace Equity
In Walk 2023, the organization’s board reported plans to raise ₹180 billion (bn) as a feature of its gathering pledges work out.
The organization is likewise known for remunerating its investors by making huge profit payouts. HUDCO brags of a high profit yield of 7.9% on its ongoing business sector cost.
Since posting on the bourses in May 2017, HUDCO share cost has fallen 38%.
HUDCO Share Price Since Listing
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#2 PTC India
Following up is PTC India.
The organization is viewed as a trailblazer in creating power exchanging India.
Throughout the long term, the organization has enhanced its administration contributions. It has as of late forayed into the breeze energy business by setting up another organization – PTC Energy Restricted.
It is additionally investigating open doors in green hydrogen, and battery energy capacity frameworks.
Coming to its financials, PTC India has revealed respectable numbers throughout the long term, in spite of developing contest inside the area.
PTC India Financial Snapshot (2018-2022)
| ₹m, consolidated | FY18 | FY19 | FY20 | FY21 | FY22 |
| Revenue |
196,394 |
151,551 |
181,008 |
183,455 |
168,564 |
| Growth (%) |
28% |
-23% |
19% |
1% |
-8% |
| Operating Profit |
13,014 |
20,838 |
18,485 |
17,250 |
16,042 |
| OPM (%) |
7% |
14% |
10% |
9% |
10% |
| Net Profit |
2,000 |
4,253 |
3,676 |
4,487 |
5,062 |
| NPM (%) |
1% |
3% |
2% |
2% |
3% |
| Debt to Equity (x) |
3.3 |
3.4 |
2.7 |
2.6 |
2.1 |
| ROE (%) |
4.4 |
12.8 |
10.0 |
10.6 |
12.1 |
| ROCE (%) |
8.1 |
11.9 |
10.6 |
10.2 |
9.9 |
Data Source: Ace Equity
The company has beenconsistently paying dividendssince 2002. The stock’s current dividend yield stands at 8.8%. This means that for every ₹100 invested in the company you earn a dividend of ₹8.8.
The consistency in dividend payments is on the back of PTC India’s healthy cash & cash equivalents.
Consistent Dividends at a Growing Rate
| Year Ending |
Dividend Per Share (Rs) |
Dividend Yield (%) |
|---|---|---|
| 31-Mar-22 |
7.80 |
9.47 |
| 31-Mar-21 |
7.50 |
9.61 |
| 31-Mar-20 |
5.50 |
14.25 |
| 31-Mar-19 |
4.00 |
5.44 |
| 31-Mar-18 |
4.00 |
4.59 |
| 31-Mar-17 |
3.00 |
3.23 |
| 31-Mar-16 |
2.50 |
3.92 |
| 31-Mar-15 |
2.20 |
2.72 |
| 31-Mar-14 |
2.00 |
2.96 |
| 31-Mar-13 |
1.60 |
2.69 |
Data Source: Equitymaster, Ace Equity
Dividend yield as per 31 March 2022
In March 2023, the company announced its collaboration with a Belgium based company to develop predictive solution for the Indian power market.
Since listing on the bourses in April 2004, shares of the company have gained 104%. In 2023 so far, PTC India shares are up 12%.
PTC India Share Price Since Listing
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#3 Jagran Prakashan
Third on the list is Jagran Prakashan, a media conglomerate.
Jagran Prakashan initially started its business with printing and publishing newspapers and magazines. However, it has expanded its portfolio in the last few years to FM radio, outdoor and digital advertising, event management, and promotional marketing.
A few of the company’s popular brands include Dainik Jagran, Mid-day, The Inquilab, and Radio City, among others.
As per the last available readership survey data,Dainik Jagranhad total readership of over 69 m, which is the highest amongst all newspapers in India.
After reeling under pressure in pandemic year, Jagran Prakashan’s financial performance has significantly improved.
Financial Snapshot of Jagran Prakashan
| ₹m, consolidated |
FY18 |
FY19 |
FY20 |
FY21 |
FY22 |
|---|---|---|---|---|---|
| Revenues |
23,040 |
23,627 |
20,973 |
12,892 |
16,160 |
| Growth (%) |
1% |
3% |
-11% |
-39% |
25% |
| Operating Profit |
6,298 |
5,745 |
4,649 |
2,798 |
4,264 |
| OPM (%) |
27% |
24% |
22% |
22% |
26% |
| Net Profit |
3,110 |
2,742 |
2,809 |
783 |
2,169 |
| NPM (%) |
13% |
12% |
13% |
6% |
13% |
| Total debt |
1,478 |
4,064 |
2,252 |
2,683 |
2,770 |
| Debt to Equity (x) |
0.07 |
0.22 |
0.12 |
0.13 |
0.13 |
Data Source: Ace Equity
If we go back to the pandemic days, it was clear the already affected print media industry had suffered a big blow due to lockdowns. Newspapers struggled as readership reduced along with advertisement revenues.
Along with this, thethreat of digitisationwas accelerating.
But big players like Jagran Prakashan took serious cost-cutting measures and hiked cover prices, among other initiatives. This cushioned the pandemic blow to some extent.
For the nine months ended December 2022, Jagran Prakashan has reported a profit of ₹1,733 m. Going by the trend, Jagran is set to surpass last year’s revenue and profit figures.
However, a big challenge for Jagran right now is soaring newsprint prices and high inflation. Newsprints account for around 30-35% of operational cost for some print media companies. In some cases, it’s 50%!
Coming to distribution to shareholders, Jagran didn’t pay dividend in the years 2020, 2021 and 2022. For financial year ending March 2023, it paid an interim dividend of ₹4 per share in August 2022.
Instead of dividend, Jagran Prakashan focuses on buybacks as it is one of the companies which have conducted repeat buybacks.
Since listing on the bourses in February 2006, Jagran Prakashan shares have rallied 60%.
Jagran Prakashan Share Price Since Listing
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#4 Gujarat Industries Power
Fourth on the list is Gujarat Industries Power (GIPCL).
The Vadodara-based public limited company is engaged in the business of power generation. It was incorporated in 1985 and is promoted by three leading Gujarat PSUs viz. GUVNL, Gujarat Alkalies, and Gujarat State Fertilisers.
It has a diversified portfolio of thermal (gas and lignite), wind and solar power plant assets in the state of Gujarat.
The company also offers operation and maintenance (O&M) services, such as power plant services, and demineralisation (DM) water supply and laboratory testing services.
Coming to the company’s financials, due to non-operation of its gas power plant, the company reported muted numbers for 2022.
Even for 2023, the company has guided for flat growth due to capacity addition.
Gujarat Industries Power Financial Snapshot (2018-2022)
| ₹m, standalone | FY18 | FY19 | FY20 | FY21 | FY22 |
| Revenue |
13,538 |
14,074 |
13,788 |
13,353 |
11,724 |
| Growth (%) |
3% |
4% |
-2% |
-3% |
-12% |
| Operating Profit |
5,320 |
6,651 |
5,469 |
4,546 |
4,270 |
| OPM (%) |
39% |
47% |
40% |
34% |
36% |
| Net Profit |
2,445 |
1,764 |
2,480 |
1,798 |
1,713 |
| NPM (%) |
18% |
13% |
18% |
13% |
15% |
| Debt to Equity (x) |
0.3 |
0.2 |
0.2 |
0.2 |
0.2 |
| ROE (%) |
10.4 |
7.0 |
9.3 |
6.4 |
5.8 |
| ROCE (%) |
13.1 |
9.0 |
11.2 |
9.2 |
8.0 |
Data Source: Ace Equity
Coming to dividends, GIPCL has consistently declared dividends since 1997.
Going forward however, the company’s dividend payout might get reduced as it has a significant capex plan.
The company is developing the Khavda project in four phases. Capex for this is around ₹1-1.2 bn for 2023 and around ₹4-5 bn planned for next year.
All this should bode well in the long term. GIPCL is also exploring new business opportunities including foraying into green hydrogen space.
Since listing in 2000, shares of the company have gained 72%.
Gujarat Industries Share Price Since Listing
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#5 Skipper
Last on this list is Skipper, a leading engineering products manufacturing company.
It is known for manufacturing transmission and distribution structures like towers and poles.
The company also manufactures polymers such as pipes and fittings and is trusted to execute infrastructure EPC projects.
In the last three years, the company’s revenue and net profit declined mainly due to Covid-19. However, it managed to have a positive net margin.
Skipper Financial Snapshot (2018-2022)
| ₹m, consolidated | FY18 | FY19 | FY20 | FY21 | FY22 |
| Revenue |
20,737 |
18,709 |
13,905 |
15,815 |
17,071 |
| Growth (%) |
25% |
-10% |
-26% |
14% |
8% |
| Operating Profit |
3,056 |
1,829 |
1,417 |
1,493 |
1,724 |
| OPM (%) |
15% |
10% |
10% |
9% |
10% |
| Net Profit |
1,178 |
312 |
413 |
214 |
251 |
| NPM (%) |
6% |
2% |
3% |
1% |
1% |
| Debt to Equity (x) |
0.8 |
0.8 |
0.7 |
0.6 |
0.8 |
| ROE (%) |
20.3 |
4.8 |
6.2 |
3.0 |
4.0 |
| ROCE (%) |
24.7 |
12.4 |
9.0 |
9.1 |
10.1 |
Data Source: Ace Equity
For the quarter ended December 2022, Skipper reported a revenue of ₹4.4 bn, up 11.1% YoY. Operating profit declined 13.9% while net profit declined 15.8%.
The profitability was impacted by rupee depreciation, leading to a loss of ₹44 m versus a gain of ₹69 m (YoY).
As of December 2022, its order book stood at ₹47 bn – the highest ever in company’s history. As per the management, the bidding pipeline remains strong. The company is actively pursuing projects worth ₹52 bn on international front and about ₹31.2 bn on the domestic front.
Skipper recently secured its largest single order win from Bharat Sanchar Nigam Ltd (BSNL) for supply and erection of GBT Towers and subsequent O&M for 5 years, extendable to 5 more years.
Going forward, strong order book will drive revenue growth and the company is also expecting better profit margins.
The country’s focus on renewable energy, roll out of 4G and 5G networks (that need massive telecom infra to be set up – India needs around 800,000 additional towers to address digital growth and 5G roll out) and China plus one, are some of the trends that are acting as tailwinds in company’s favour at present.
The company has also been paying dividends consistently.
Since listing in July 2014, Skipper share price has rallied 167%.
Skipper Share Price Since Listing
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Snapshot of top high quality penny stocks from Equitymaster’s Indian Stock Screener
Here’s a quick view of the above companies based on their financials.
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If it’s not too much trouble, note that these boundaries can be changed by your determination standards.
This will help you recognize and dispense with stocks not gathering your necessities and accentuate those stocks well inside the measurements.
Disclaimer:This article is for data purposes as it were. It’s anything but a stock suggestion and ought not be treated in that capacity.
