A clutch of penny stocks with price-to-book value below 1 have delivered sharp multibagger returns over the past year, with six low-priced counters rising between 115% and 1,513% even as the Nifty 50 slipped nearly 3% over the past month. The list includes Bhagawati Gas, Trio Mercantile, Dolphin Medical Services, Indo Credit Capital, Sword-Edge Commercials and NHC Foods. These stocks trade between Rs 0.55 and Rs 8.55, but have more than doubled investor wealth over the last one year.
The common factor is the low price-to-book value, or PBV, which means the stock is trading at a low valuation compared with its book value. Book value broadly refers to the company’s net asset value on its balance sheet after deducting liabilities from assets.
