Up to 780% return in 50 days: Stocks you overlooked are making crorepatis

Unsuspecting names are making big money in this market.

Stocks from among those that traded below Rs 10, thus earning investors’ disdain and disregard for their penny status, have suddenly burst forth to deliver eye-popping gains in the recent market rebound from the lows of March 24, when Sensex and Nifty had scaled their fresh 52-week lows.

Telecom player Vodafone Idea has stood out, proving to be a solid contrarian bet as it rallied 200 per cent to Rs 10.08 on June 9 from Rs 3.36 on March 24.

On the NSE, average deliverable volumes of the telecom stock in percentage terms surged to 32 per cent during the period from a one-year average of 29 per cent.

Vodafone recently said it was constantly evaluating various opportunities for enhancing stakeholders' value.

Brokerage firm Ambit Capital last month gave a ‘buy’ rating on the stock with a price target of Rs 19. “The upside will be greater if Vodafone gets more capital to invest in defending premium customers and hence market share,” Ambit said.

Birla Tyres, a BK Birla group company engaged in auto tyres & rubber products business, has scripted an even more stellar story, jumping 780 per cent from Rs 2.78to Rs 24.45. This means the stock swelled an investment Rs 1.25 lakh into Rs 10 lakh within weeks.

Birla Tyres is a B2B-focused business, with a stronghold in light commercial vehicles, trucks and mining machines.

Some other smallcaps that have logged solid gains in this rally in included Alok Industries (413 per cent), Alchemist (up 667 per cent), Educom Solutions (up 532 per cent), Opto Circuits (up 495 per cent), Vikas EcoTeck (up 361 per cent), Ruchi Infrastructure (up 284 per cent) and Urja Global (up 273 per cent).

BSE benchmark Sensex has risen 32 per cent from its 52-week low during this period, while BSE Midcap index has surged 31 per cent and BSE Smallcap index 37 per cent.

Company-specific reasons also boosted market sentiment. For instance, bankrupt firm Alok Industries saw a turnaround after it was taken over by Mukesh Ambani’s Reliance Industries earlier this year.

Barring Vodafone Idea, Alok Industries and Birla Tyres, all the above-mentioned stocks are still trading in single digits on Dalal Street. Penny stocks are considered risky bets for their wild volatility, smaller business sizes and dearth of liquidity on their counters.

Among others, JMT Auto, Andhra Cements, Sintex Plastics Technology, Siti Networks, GBL Industries, Brightcom Group, JCT, Emco, Manaksia Aluminium and Prozone Intu Properties have advanced between 180 per cent and 260 per cent in last 50 sessions.