While kickstarting your journey in stock market, investors are not required to spend a significant amount of money. This is because there are stocks which have a price of less than INR100 per share, and they have strong long-term growth potential. While investing in low price high potential stocks for long term, it is important for the investors to analyze price trends, news, charts, and fundamental analysis.
At the time of investing in stock market, it is of utmost importance to keep a close check not just on price but on the value of the stocks. More often than not, there are numerous investors which tend to go for stocks which are priced lower in equity market. While investing in low price high potential stocks for long term, investors are required to keep in mind that such stocks have more risks attached to it than high-priced stocks. However, if identified after thorough research, these stocks can deliver significant returns over the long-term. While there is no specific definition of low-priced stocks, financial analysts believe that that stocks which are priced below INR 100 are low-priced stocks. On the other hand, stocks which are prices more than INR500 are considered high-priced stocks.
Relatively lower-priced stocks attract potential investors since they have an opportunity to purchase more stocks in the limited amount.
With this in mind, it’s time to explore best low price high potential stocks for long term.
1. Housing & Urban Development Corporation Ltd
HUDCO has been categorised as a unique institution and a public sector company, under the Ministry of Housing and Urban Affairs (MoHUA). The company is the leading techno-financing public sector enterprise, in the area of housing and infrastructure development in India.
The company saw total income for FY23 of INR7,086.18 crore (FY22: INR 6,997.66 crore) which includes other income of INR36.72 crore (FY22: INR43.58 crore), while PBT for the year came at INR2,289.41 crore and Profit After Tax (PAT) was INR1,701.62 crore. Total comprehensive income for FY23 was INR 1,726.36 crore in comparison to INR1,714.68 crore in FY22.
Twin impacts of pandemic and Russia-Ukraine resulted in significant challenges for global economic growth. As a result of this, India remained in the bright spot. HUDCO’s growth prospects are critically linked to urbanisation trend of India. Its urban population should increase from 470 million in 2021 to 600 million by 2036, constituting ~40% urbanisation level. Given the continuous rise in urbanisation levels and significant increase in capital investment requirement, HUDCO remains in the strong position to capture growth opportunities.
2. IDFC First Bank Ltd
IDFC First Bank Ltd provides high-quality products such as current accounts, savings accounts, FDs, home loans, auto loans, wealth management services and other banking-related products.
The bank has announced financial results for the quarter ended June 30, 2023 (1Q24). Its net profit went up by ~61% year-over-year from INR474 crore in 1Q23 to INR765 crore in 1Q24. This growth stemmed from strong growth in core operating income.
Core operating profit (pre-provision operating profit which excludes trading gains) grew strongly by ~45% year-over-year from INR987 crore in 1Q23 to INR1,427 crore for 1Q24. Net Interest Income (NII) of the bank saw an increase of ~36% year-over-year from INR2,751 crore in 1Q23 to INR3,745 crore in 1Q24.
Bank built a strong franchise with high CASA ratio of ~46.5%. Retail deposits of the bank continues to grow, based on its strong brand, ethics, customer-friendly products and digital innovations.
On retail, rural & SME business, an area where IDFC First Bank mainly specializes in, gross NPA came down to as low as ~1.53% and net NPA came down to ~0.52%.
Capital adequacy of the bank remained strong at ~16.96% with CET-1 ratio at 13.70% as on June 30, 2023. Average LCR of the bank was strong at ~125% for the quarter ending June 30, 2023.
3. National Fertilizer Ltd
NFL is a Schedule ‘A’ & a Mini Ratna (Category-I) company and it targets to be a leading Indian company in fertilizers and beyond with commitment to all its stakeholders.
Surpassing all the prior record, the company saw highest-ever production, sales, profits and turnover. It saw record turnover of INR29,616.52 crore in FY23, exhibiting a rise of 87% over turnover of INR 15,857.09 crore of previous year. It recorded a threefold increase in the PAT of INR456.10 crore during FY23 which was INR108.20 crore in the previous year. Production of Urea, DAP and NPKs in India achieved a year-on-year increase of about 14%, 3% and 12% respectively in the FY23. Total production of Urea, DAP and NPKs came in at ~28.49 million tons, 4.35 million tons and 10.04 million tons, respectively during this period.
Focus of the company is on achieving strong growth in revenues and profits through maximizing Urea production in energy efficient manner, maximizing production of Bentonite Sulphur & Bio-fertilizers, marketing of Urea manufactured by RFCL, production and sale of quality & certified seeds in own brand name through seeds multiplication program, etc.
4. Infibeam Avenues Ltd
The company has been categorised as a leading financial technology company, providing Digital Payment Solutions and Enterprise Software Platform to large enterprises and government globally.
The company stellar performance in 1Q24 as it achieved historical milestones despite the seasonally weak first quarter. Gross revenue and adjusted EBITDA (operating profit) in 1Q24 was the highest in the history of the company. Gross revenue of the company came in at INR742 crore, exhibiting a rise of ~77% and net revenue grew by ~34% year-over-year to INR99 crores.
In FY24, the company expects to achieve net revenue in the range of INR410 crore – INR415 crore, exhibiting a rise of 25% – 26%. It anticipates EBITDA of between INR230 crore – INR235 crore.
Conclusion
Analysing the best low price high potential stocks for long term can be a tedious task as high amount of research and thorough analysis of the company’s business model is required. This is because investing in such stocks are quite risky. That being said, these stocks have the potential to deliver stellar returns over the long-term.
While Newsblare has shortlisted some of the above-mentioned low price high potential stocks for long term, there can be several other stocks which can make up to this list.
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