Best Stocks Under Rs. 20 in India (2023)

Last Updated on Apr 11, 2023 by Anjali Chourasiya

Stocks under Rs. 20 almost always get the attention of investors. While many focus on high-priced stocks, there are opportunities to be found even among the low-priced ones. In this article, let’s dive into the world of best stocks under Rs. 20 for the long term in India and explore them based on multiple factors such as high net-profit margin, highest dividend yield, fundamental score, and relative trading volume.

Best stocks under Rs. 20 in India (As of April 2023)

Note: The data in the above table is from 11th April 2023. The stocks are filtered using Tickertape Stock Screener using the following parameters:

• Close Price: Set to 0.03 – 20
• 5Y Average Net Profit Margin: Set the limit to 10 to High (Sort from highest to lowest)
• 5Y Average Return on Equity: Set the limit to 10 to High

Details on the filters used to sort the best stocks under Rs. 20

Close price: This is the close price of the stock on the last day it traded. The close price is set to 20 as a high limit to get all the stocks under Rs. 20.

5-yr average net profit margin: Net profit margin explains the number of units of profit earned for every 100 units of revenue. 5-yr average net profit margin is the average of the net profit margin number over the previous five financial years. A profit margin of 10% is considered average. 

5Y average return on equity: It is the average of the annual ROE number over the previous five financial years. Return on equity helps understand the number of units of profit generated per unit of money invested in the company. Higher the number better the utilisation of equity capital. Generally, 15-20% of returns on equity are considered good. 

Fundamentally strong stocks below Rs. 20 in India

Note: The data in the above table is from 11th April 2023. The stocks are filtered using Tickertape Stock Screener using the following parameters:

• Close Price: Set to 0.03 – 20
• Fundamental Score: Sort from highest to lowest

Detail on the filter used to sort the best fundamentally strong stocks in India

Fundamental Score: The score is a smallcase proprietary score between 1 and 10 assigned to stocks listed on NSE. The score helps rank the stock versus all other stocks in the respective sector. The higher the score, the better the company. The score is calculated taking into consideration factors like valuation, profitability, market share growth, financial health and earnings growth of the company.

Most active stocks under Rs. 20

Note: The data in the above table is from 11th April 2023. The stocks are filtered using Tickertape Stock Screener using the following parameters:

• Close Price: Set to 0.03 – 20
• Relative Volume: Sort from highest to lowest

Detail on the filter used to sort the most active stocks under Rs. 20

Relative Volume: Often called RVOL, this ratio displays the average volume of the stock over the previous 10 days divided by the average volume of the stock over the previous 91 days. The ratio helps understand how in demand the stock has been in the past few days.

Suppose the 10-day average volume is 10,000 and the 90-day average volume is 4,000; then the relative volume is 10,000/4,000 = 2.5. RVOL above 2 is considered to be a signal of high demand for the stock, and when a stock is in demand, the price tends to move up very quickly.

Dividend-paying stocks under Rs. 20

Note: The data in the above table is from 11th April 2023. The stocks are filtered using Tickertape Stock Screener using the following parameters:

• Close Price: Set to 0.03 – 20
• Dividend Yield: Sort from highest to lowest

Detail on the filter used to sort the highest dividend yield stocks under Rs. 20

Dividend Yield: The ratio is calculated as dividend per share (DPS) for the most recent fiscal year divided by the close price of the stock. The ratio is used to calculate the earning on investment considering only dividends declared. Higher the dividend yield, the better. One should always consider dividend yield when investing in a company’s stock, as it can be a significant part of the return that might be generated. High dividend yield stocks could be a good investment avenue to supplement any income needs.

Suppose DPS is Rs. 16 and the stock price is Rs. 250; the dividend yield is calculated as (16/250)*100 = 6.4%.

Factors to consider before buying stocks below Rs. 20

The most important factor to consider before investing in stocks below Rs 20 is – risk. While many of these semi-penny stocks have generated mass wealth for investors, many others have been a failure on the markets. Note that these stocks can be the worst performers in the case of market turndowns. Also, a majority of these stocks may deal with liquidity issues. 

Investment horizon, sector, and timing are other essential factors you need to consider before investing. Remember that stock investing attracts taxes, with LTCG tax fixed at 10% (after Rs. 1 lakh) and STCG tax at 15%.

To conclude

Timing is arguably the most crucial factor to consider when investing in the stock markets. The right stock picked at the right time can turn your fortunes. If the company has growth potential and your research is viable, investing in semi-penny stocks can be beneficial. But remember that investing in any stock attracts considerable risk, which is magnified manyfold with semi-penny stocks.

Aid your research by visiting Tickertape, which has a plethora of options, filters, and tools to customise your investment journey and help you pick the right stock as per your risk appetite.

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Anjali Chourasiya

I am a finance enthusiast who loves exploring the world of money through my lens. I’ve been dedicated to building systems that work and curating content that helps people learn.

As an insatiable reader and learner, I’ve spent the last two years exploring the world of finance. With my creative mind and curious spirit, I love making complex finance topics easy and fun for everyone to understand. Join me on my journey as we navigate the world of finance together!

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