A penny stock always attracts people because of its low face value. While investing in a penny stock involves higher levels of risk, investors try to find one having the potential of being a multi-bagger penny stock.
Important Disclaimer: This post is not investment advice. The sole purpose of this post is to provide education on the topic. Readers must do a careful analysis and research before making any financial decision.
What is a Multibagger Penny Stock?
A stock with a low face value is called a penny stock. In fact, some penny stocks have a face value below INR 10. When a penny stock has the potential to increase in value by a large amount, resulting in multifold returns on investment, it is called a multi-bagger penny stock.
Due to low face values, If new investors start with a tiny amount, there is almost no risk and chances to get returns of 300% to 500% or sometimes higher. Hence, new investors can gain experience with penny stocks.
top 7 Multibagger Penny Stocks For 2025
- Trident
- IDFC First Bank
- IRFC Ltd
- South Indian Bank
- Auro Labs
- Nacl Industries
- Ashapuri Gold
1. Trident Ltd
Trident Group is a group of companies located in Ludhiana, Punjab (India). The group operates in Yarn, Bed Linen, Paper, Chemicals and Captive Power businesses.
Trident Limited is the largest wheat straw-based paper manufacturer and one of the world’s leading integrated home textiles manufacturers.
Key Indicators:
- P/E Ratio: 33.97
- P/B Ratio: 4.17
- ROE: 22.91%
- ROCE: 23.04%
- Dividend Yield: 1.13%
- Debt to Equity: 0.41
| Plus Points |
|---|
| 1. Experienced Team 2. Consistent Dividend Payer 3. Increasing Demand for Bed Linen 4. Good Debt Equity Ratio 5. Company has received Wal-Mart’s “Supplier of the Year award” |
2. IDFC First Bank
IDFC first bank is an Indian private-sector bank formed by the merger of IDFC and Capital First. It is the first bank to offer lifetime free credit cards and monthly credit interest on savings accounts.
IDFC was set up in 1997 to finance infrastructure projects in India. Then it expanded to investment banking and institutional securities, Mutual Funds, and Infrastructure Debt Funds.
Key Indicators:
- P/E Ratio: 17.97
- P/B Ratio: 1.43
- ROE.75%
- ROCE: 4.87%
- Dividend Yield: —
- Debt to Equity: 2.52
| Plus Points |
|---|
| 1. 20+ Years Experience 2. Regulated by RBI 3. Diversified Services 4. Low NPAs |
3. IRFC Ltd (Indian Railway Financial Corp Ltd)
Indian Railway Finance Corporation (IRFC) was set up in December 1986 for mobilizing funds from domestic and overseas markets to meet the predominant portion of the Extra Budgetary Resources requirement of Indian Railways.
Key Indicators:
- P/E Ratio: 5.54
- P/B Ratio: 0.82
- ROE: 15.84%
- ROCE: 5.12%
- Dividend Yield: 5.08%
- Debt to Equity: 9.47
| Plus Points |
|---|
| 1. Robust fundamentals 2. Growth potential high 3. The government of India has a majority stake 4. Ministry of Railways has the administrative control |
4. South Indian Bank
South India Bank is a major private sector bank headquartered at Thrissur in Kerala, India. It has 933 branches and 4 service branches. It has also set up 1000+ ATMs and 100+ CDMs.
In March 2023, the total deposits of the bank rose by 2.8% and CASA increased by 2.1% as compared to the previous year. This indicates strong customer trust and confidence in its services.
Key Indicators:
- P/E Ratio: 4.46
- P/B Ratio: 0.50
- ROE: 0.77%
- ROCE: 2.02%
- Dividend Yield: —
- Debt to Equity: 0.56
| Plus Points |
|---|
| 1. Lower NPAs 2. Great Customer’s Trust 3. The Bank has won the ‘UiPath Automation Excellence Awards 2021’ for Best Automation 4. Improved capital adequacy and better net interest margin |
5. Auro Labs
Established in 1997, Auro Labs manufactures a wide range of ophthalmic consumables such as intraocular lenses, surgical sutures, pharmaceutical products, surgical blades and equipment.
The company owns one manufacturing unit with a 500-tonne capacity. The company is diversifying into related healthcare areas. It is an integral part of the Aravind Eye Care System. The company exports its products abroad.
Key Indicators:
- P/E Ratio: 37.43
- P/B Ratio: 1.29
- ROE: 9.47%
- ROCE: 12.20%
- Dividend Yield: —
- Debt to Equity: .44
| Plus Points |
|---|
| 1. Long-term experience in the industry 2. Company has a wide range of popular products 3. Company exports products to countries like Spain, Germany, the UK, Malaysia etc. 4. Company has received ISO 9001:2000 and WHO – cGMP certifications for its quality management. 5. Company’s revenues grew from 40.79 cr in 2018 to Rs. 54 crores in 2021. However, it dropped in FY22. |
6. Nacl Industries
Set up in 1993, Nacl Industries Limited is a well-known player in the Agrochemical space. It is considered a trustworthy name in the field.
When it started off, it manufactured Agrochemical Active Ingredients. Today, It has 3 manufacturing units, 5 million customers, 12000+ retailers, and 1000+ employees. The company is spread over 25+ countries.
Key Indicators:
- P/E Ratio: 20.89
- P/B Ratio: 3.16
- ROE: 17.06%
- ROCE: 17.25%
- Dividend Yield: 0.64%
- Debt to Equity: 0.91
| Plus Points |
|---|
| 1. High Growth Potential 2. Great Customer trust 3. It has tie-ups with large Indian agrochemical majors and MNCs for the domestic 4. Company exports its products to more than 25 countries |
7. Ashapuri Gold
Ashapuri Gold Ornament Ltd is one of India’s leading manufacturers of antique jewellery. It was established in 1997. The company has a large list of inventory of designs and provides quality services.
They offer 22-carat gold ornaments. The company has its manufacturing unit in Ahmedabad and planning to expand it nationally. Other offices are located in Ahmedabad, Delhi, Mumbai, Bangalore and Chennai.
Key Indicators:
- P/E Ratio: 88.69
- P/B Ratio: 2.27
- ROE: 3.88%
- ROCE: 5.20%
- Dividend Yield: —
- Debt to Equity: 0.05
| Plus Points |
|---|
| 1. Company’s clients include Tanishq, Malabar Gold and Joyalukkas. 2. Received Orders worth 30 crores in GJS 2022 (India’s 1st B2B Jewellery Expo) 3. Well-known and Trusted Gold Supplier 4. Good and Experienced Team |
Final words
There are many other penny stocks in the market which have the potential of becoming a multi-bagger. Although we can predict multi-bagger penny stocks by analysing the history of performance, debt-to-equity ratio, P/E ratio etc, there is no guarantee to predict accurately. People must invest their time in research before investing their money.
