Author: root

1. Samtex Fashions:

This readymade apparels firm listed on the BSE in a month’s time has given multibagger returns to the tune of 154% considering the price of Rs. 1.51 apiece on October 29, 2021. In trade on November 30, 2021, even in a subdued market, the scrip hit upper circuit limit and settled at 52-week high price of Rs. 3.83 per share. Samtex Fashions last commands a market cap of Rs. 28 crore. The scrip’s YTD return and 1-year return are 361% and 681%, respectively.

Not only this penny scrip from the textile space but many counters from the space have been seen gaining traction during the November month. Probably, government’s PLI (production linked incentive) scheme has come as a help for the sector.

Samtex Fashions started in the year 1993 in collaboration with Samsung is a premier entity in the world of fashion. The firm is into manufacturing quality garments for exports to major stores in the US and Europe as welll as premium brands in the country. The company is a recognised GoI export house.

2. Pan India Corporation:

The software medium and small sector entity during the review period i.e. last 1 month has produced 108% return inching higher from a price of Rs. 1.38 as on October 29 to currently at Rs. 2.87. The scrip’s 1-year and YTD are still more fascinating at 1411% and 744%, respectively.

The company incorporated in 1984 under the name Fairdeal Leasing is primarily engaged in buying, selling, transferring, hypotheticating, dealing in and disposing securities including shares, stocks debentures, debenture stock, securities, properties of any other entity including securities of local authority, certficates or bonds.

3. Shree Bhawani Paper:

This paper company stock also during the time period has shown resilience and gained by 107 percent from a price of Rs. 2.92 just a month ago to now currently at above Rs. 6 per share on the BSE. The stock’s market cap is at Rs. 21 crore. The stock’s 1-year return has been at 71 percent.

The company is primarily engaged in manufacturing paper and exports its product line to Middle East, Nepal and other countries. Uncoated paper as well as paper board are the company’s product which find application in writing and printing purposes.

4. Sharp Investments Ltd.

This finance sector also spurted by a similar degree in one month and provided multibagger return of over 100% of 107.5% in the last 1-month. The scrip closed today at a price of Rs. 2.49 while its market cap stands at Rs. 60 crore. This is a zero debt company. The company’s 1-year and YTD return are astounding at 1283% and 858%, respectively.

Sharp Investments is an NBFC firm carrying out the business of extending loan against shares, securities and properties. The firm also offers other loans including personal loans, corporate loans. Beside it also offer trade financing and trading in shares and securities.

Points to note when investing in Penny stocks

The investment into penny stocks entail a high risk nonetheless if one goes by the filters aronymed as ‘SOLID’ implying 6 criterias in the selection of penny stocks namely:

1. S-Strong balance sheet or financials

2. O- Owners of the firm are also operators of the firm

3. L-long term viability of company’s business

4. I-for income generating

5. D-deep discount in valuations-Experts see penny stocks available at a deep discount of say 20 percent net current assets less total liabilities as a good option.

Penny stock	Sector	Current market price as on November 30, 2021	% gains in the 1 month	% gains in the 1-year time frame
Samtex Fashion	Textile	Rs. 3.83	154.00%	682.00%
Pan India Corporation	Software	Rs. 2.87	108.00%	1411.00%
Shree Bhawani Paper	Paper	Rs. 6.05	107.00%	71.00%
Sharp Investments	Finance	Rs. 2.49	108.00%	1283.00%
Supremex Shine Steels	Steel	Rs. 5.11	158.00%	319.00%

Disclaimer:

We have just collated the list of few penny stocks priced below Rs. 10 that in 1-month’s time doubled investors’ money and have superb 1-year gains. Nonetheless, the story should not be construed as a recommendation to buy into these penny stocks that are highly risky.

GoodReturns.in

Invest in corporate FDs rather than bank FDs.

Corporate Fixed Deposits, like bank FDs, offer the security of guaranteed returns and the flexibility to choose the term. The Corporate Fixed deposits are in general offers 1% to 3% higher interest rates compared to what ban FDs offers for a similar period.

Bajaj FinServ is a good example of corporate FDs that offers a better return, higher than the bank FDs. These FDs offer assured returns, easy online application and accessibility, and Higher returns. These FDs schemes come with an option to receive a return at monthly or quarterly periods, depending on the options.

Compare the interest rates on FDs offered by different companies

Before going with a particular FD, it is better to compare the FDs interest offers that other companies are offering. Each lender offers a different rate of interest on FDs to their customer. Your goal should be to select the one that will provide you with the best return on your investment. Comparing the FDs interest rate will help you to choose the right FD and will improve and maximise your return.

For higher returns, choose a cumulative FD

After you’ve settled on corporate or bank FD, the next step is to maximise your fixed deposit returns. A cumulative and non-cumulative fixed deposit are both available to you. Choose a cumulative FD for a better and higher return on your investment. On maturity, a cumulative fixed deposit will pay you both the interest and the principle. The interest on a cumulative fixed deposit is added to the principal that could be monthly or quarterly. As a result, you are earning interest on interest. Because of the compounding effect, the effective rate of interest rises.

Go for the FD investments that offer Tax benefit

Some investments offer a tax benefit to the investors, choose the investments that offer you higher return savings. There are two types of tax benefits for you. The first one is under section 80c of the Income Tax Act, 1961. Under this section, the amount invested is deducted from the total income that is up to Rs 1.5 lakhs. These investments are Public Provident Fund (PPF) FDs. Etc. Fixed Deposit is one of them that comes under tax benefit.

The second one offers tax benefit on interest or return earned from the investments in the form of direct benefit to the investor. This allows the investor to avoid tax directly on the return.

Invest in a variety of FDs to increase your liquidity

Spending your money on a variety of fixed deposits can help you get consistent returns and liquidity at the same time. Build a ladder of FDs with different tenors to get the most out of your investment. For example, instead of investing all your money in one FD, split the amount into 2 or 3 and invest each one in a different FD. This will allow you to have the upper hand in liquidating the investment in case of emergency, and doing this also offer you a great return.

By following these steps you can improve your returns on fixed deposits. This will also allow you to have financial freedom.

Should you buy the stock of Coal India?

Last year at the same time, Coal India had declared an interim dividend of Rs 7.5 per share and this year it has given a better dividend. The company is regular on the dividend paying list, is a cash rich and also a debt free company. For the quarter ending Sept 30, the results of the company were not too impressive, but most brokerages are upbeat on the stock.

Recently, brokerage Motilal Oswal hiked the price target on the stock to Rs 200. According to the report, the Coal India stock trades at 3.4x/3x FY22e/FY23e EV/Ebitda, with an attractive dividend yield of 11%.

The brokerage has valued the stock at 4 times FY23e EV/Ebitda with a target price of Rs 200. “We maintain our Buy rating, with a revised target price of Rs 200 per share (from Rs 185 earlier). A surge in coal demand from the Power sector, which could squeeze supplies to non-regulated sectors through e-auctions, remains a key risk as it could hurt profitability,” it had said.

Even ICICI Securities had recently suggested a “buy” on the stock with a price target of Rs 234, implying a hefty upside from the current price of Rs 155.

Dividend yield should keep a floor price on the stock

The shares of Coal India have dropped from levels of Rs 200, following a shortage of Coal to the current price of Rs 155. If you buy the stock now, you are also entitled to a dividend of Rs 9 per share, which will bring down the cost of acquisition even further.

We suggest investors to but the stock as demand for coal is surging and prices are likely to remain elevated going forward. The dividend yield is consistently likely to remain over and above that 10% mark and anywhere between 11 and 15%. This makes the stock very attractive as the dividend yields are much better than the interest rates offered by bank deposits.

With the demand for power likely to surge, there is likely to be a corresponding surge in the demand for coal, which should augur well for the company.

At a time when there are threats of a new omicron virus, it would be a good idea to stick to strong dividend paying stocks, as the dividend yield on these companies would put a cap on the stock fall. We have been advising caution to investors not to invest large amounts and hence stick to debt free companies, with a strong track record of paying dividends.

Disclaimer:

Investing in equities poses a risk of financial losses and investors should exercise due caution before a large-scale exposure. Greynium Information Technologies and the author are not liable for any losses caused as a result of decisions based on the article.