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High Book Value Penny Stocks

While doing your thorough analysis and valuing companies, you must have stumbled across the term price to earnings ratio (PE ratio).

The PE ratio tells us how much you pay for one rupee of a company's earnings.

Apart from the PE ratio, another parameter that is commonly used to value stocks is the price-to-book value (P/BV).

The P/BV is a valuation ratio and is arrived at by dividing the market price of a share with the respective company's book value per share.

P/BV ratio = market price per share / book value per share

Now, book value is equal to the shareholder's equity (share capital plus reserves and surplus). Book value can also be arrived at by subtracting current liabilities and debt from total assets.

With the concept of book value clear, let’s take a look at high book value penny stocks.

High Book Value Penny Stocks

Company Name Book Value
Elcid Investments Ltd. 508261.02
Precious Trading & Investments Ltd. 5221.65
SPV Global Trading Ltd. 4226.49
Kampani Consultants Ltd. 1378.28
Sai Capital Ltd. 1190.65
Gold Rock Investments Ltd. 1085.06
Anand Projects Ltd. 1021.09
Digital Electronics Ltd. 1012.80
Swastik Safe Deposit & Investments Ltd. 865.67
Titan Trading & Agencies Ltd. 658.39
Gitanjali Gems Ltd. 553.24
Plethico Pharmaceuticals Ltd. 473.73
Mack Trading Company Ltd. 472.67
Consolidated Finvest & Holdings Ltd. 444.79
STEL Holdings Ltd. 421.42
Trejhara Solutions Ltd. 388.56
Elder Pharmaceuticals Ltd. 376.55
Kothari Products Ltd. 375.48
Anil Ltd. 362.29
Gajanan Securities Services Ltd. 360.93
Data Source: Ace Equity

Please keep in mind the above companies are not recommendations by any stretch.

Since you’re interested in high book value companies and penny stocks, check out Equitymaster’s stock screener which has a screen on high price to book stocks.

You can put additional filters and customize this screener as per your needs.

A word of caution...since penny stocks are highly speculative and are illiquid in nature, loading up on the wrong penny stocks can prove to be extremely risky.

A lack of history and information about penny stocks, as well as low liquidity, can cause you to lose your money on what may seem like a bargain.

That is why we recommend you to check out this framework for investing in penny stocks. This strategy is the easiest one to make money from penny stocks and will lead you towards the multibagger penny stocks.

You can also checkout our playlist on Penny Stocks on Equitymaster's YouTube channel.


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What are penny stocks?

Penny stocks are shares of listed companies priced below Rs 100. In the US market, these stocks trade for less than a dollar i.e. for pennies. Hence the name.

Penny stocks have the potential for above-average returns. However, they are extremely risky. Therefore, investing in them requires care and caution.

You can see the list of Indian penny stocks and how they are performing here...

What is the price to book value ratio?

The Price to Book Value (P/B) ratio is a valuation ratio that is used to determine whether a stock is undervalued or overvalued.

It compares the company's stock price with its book value per share.

How is the PB ratio calculated?

The PB ratio is calculated by dividing the stock price by the company's book value per share.

PB Ratio = Stock Price/Book value per share

Watch this video for a detailed explanation of the PB Ratio.

What is a good PB ratio?

As per the tenets of value investing, any value under 1 is considered a good value. However, investors often consider stocks with a PB ratio of under 3.