Table of Contents

Table of Contents

Top Stocks Under 150Rs for Maximum Returns!

The majority of the stock market investors, look for stock under 150 Rs. Often people think that only stock under 150 Rs would rise and not the ones that are in the thousands. This is a complete misconception. The growth of the stocks depends solely on the financial sheets and not the stock price. But we do understand that sometimes people don’t have a huge sum to invest. If they have only Rs 1000 to invest in a month, they could merely buy 1 or 2 shares of only one company. Similarly, students don’t have a lot of money to invest in stock markets. Therefore, people look out for stock under 150 Rs to invest in.

Often stock under 150 Rs are termed penny stocks, and they have poor fundamentals. But this doesn’t apply to all the stock under 150 Rs. There are still stock under 150 Rs that are fundamentally sound. But despite that, stock under 150 Rs would be very risky because they fall into the small-cap category generally. Also, it is important for an investor to understand that if he/she only invests in stock under 150 Rs, then because of a lack of diversification, the risk in the portfolio would be extremely high. However, here are our picks for the stock under 150 Rs that have good financials.

Pick No.1 of stock under 150 Rs: IDFC First Bank

IDFC First Bank provides banking and financial services, which include digital banking, retail banking, wholesale banking, and treasury operations. It was founded by the merger of Erstwhile IDFC Bank and Erstwhile Capital First on December 18, 2018.

Why did we pick it up on our list of stock under 150 Rs?

  1. Strong management backing

In 2012, Vaidyanathan after joining the NBFC capital first grew the AUM from Rs 6186 Cr in FY12 to Rs 32683 Cr in FY19. The retail AUM increased from 10% in 2012 to 90% in 2019 which is amazing. The 5-year PAT of NBFC grew at a CAGR of 54% and the return on equity increased from 0.5% in 2012 to 14.5% in 2019. In this period, the stock price during his period increased seven folds. This growth shows the strength of the management and its capabilities to achieve milestones.

  1. Unique benefits for customers

IDFC First Bank is the first and only bank in India that offers zero fees for 28 essential services on savings accounts including ATM cash withdrawals, IMPS, RTGS, NEFT, Cash Deposits and Cash withdrawals at branches, SMS Alerts, Cheques book, Demand Drafts, Pay-order, duplicate statements, etc. This way, IDFC First Bank customers save a lot with them. They are the first bank to offer monthly credit in savings accounts, so customers earn more with them. The bank’s credit cards have unique features such as lifetime free, never-expiring rewards points, zero interest on cash withdrawal at ATMs and low APR.

  1. Transformation

Since the merger, IDFC FIRST Bank has shifted its focus to retail banking. The CASA ratio has increased from 8.6% (March 31, 2023) to 49.77% due to the increase in retail deposits. Also, they have set up 809 branches and 925 ATMs.

In 2021, they have reduced the deposit rate from 7% to 4% for deposits up to Rs. 10 Lakhs. Their deposit growth is still strong due to their strong service and image as an ethical, clean institution.

  1. High ROEs

Despite significant setup investments in the bank, they’ve seen a steady rise in our ROE since their merger, increasing from near-zero to 10.95% in FY23. This is largely due to their strong incremental profitability. Their unit economics are very robust, with an incremental ROE of over 20% in their primary growth areas of retail and commercial lending, even after adjusting for operating expenses, credit costs, and taxes. Additionally, their wholesale business is generating an impressive ROE of over 15%. The company has given guidance for ROE to be 13-15% in FY24-FY25.

  1. Retail NPA

In retail, which is their main area of growth, they have a track record of 12 years of maintaining their Gross NPA at ~2% and net NPA of ~1%. Their portfolio has been subjected to multiple stress tests, including economic slowdown (2010-2014), Demonetization (2016), GST implementation (2017), ILFS crisis (2018), and Covid (2020- 21). Even post-COVID, retail NPA has reverted to the long-term averages and improved further to Gross NPA of 1.65% and Net NPA of 0.55% as of March 31, 2023.

  1. High Corporate Governance

The bank has a distinguished Board of Directors comprising eminent, highly qualified, and extensively experienced individuals. All committees, with the exception of CSR, are led by independent directors, ensuring impartial decision-making. They keep honest and open communication channels both internally and externally. In line with this, they also provide detailed investor presentations to keep their stakeholders informed. It is extremely important to note that, in any financial institution trust plays a very important role.

  1. Targets of the bank

The bank has given some targets for FY24, some of them are achieved and some are on track.

  1. Technical Outlook

The company has broken its consolidation phase and rallied upwards.

Pick No.2 of stock under 150 Rs: Zomato

Incorporated in 2010, Zomato Limited is one of the leading online Food Service platforms in terms of the value of food sold. Its offerings include food delivery, dining-out services, Loyalty programs, and others. But why did we pick it up on our list of stock under 150 Rs?

  1. Moving towards profitability

If you look at its financial sheets, the company had a gradual progression of moving towards profitability. The company first turned EBITDA positive in its food delivery business in Q2FY23 then it turned EBITDA positive excluding the ex-quick commerce in Q4FY23 of Rs 28 Cr. Finally, it turned overall business EBITDA positive of 12 Cr in Q1FY24.

When a company turns its EBITDA positive, it means that the core operations of the business have started generating enough revenue to cover its operating expenses and produce a surplus. This surplus revenue could be utilised to fund capital expenditures, cover interest payments on debt, and provide for other financial obligations.

The company said it will become profitable in the following four quarters. However, it delivered with one quarter. But if you see the company has reported a profit after tax of 2 Cr, the Profit before tax is a loss of 15 Cr. This is due to deferred tax.

The question comes, what is deferred tax?

The tax effect due to timing differences is termed deferred tax. Deferred tax means the taxes that were postponed. It is recognised on all timing differences – Temporary and Permanent.

However, the progress of Zomato towards becoming a profitable company is very impressive. Thus, Zomato finds its place in our list of stock under 150 Rs.

  1. EBITDA Margins

The below chart shows the improvement in Zomato’s adjusted EBITDA margin (as a % of GOV) over the last 8 quarters (2 years). In the chart, we can see how the margins have been steadily improving, while the management expects the margin to go 4-5%.

  1. Change in strategy in Hyperpure business

Hyperpure is Zomato’s farm-to-fork supply platform, which is available for Indian restaurants. The company procures fresh, clean and high-quality ingredients from the market or directly from mills, farmers producers, processors, and mills. The company then supplies food service partners with the right ingredients and helps them to make the supply chain more efficient.

The company has raised the threshold for minimum order value below which restaurants aren’t permitted to make orders on Hyperpure. This has resulted in two issues:

  • the smaller, unprofitable restaurants churned out and
  • the average order value on our platform went up, driving both growth in revenue and improvement in profitability.

As the business scales, we are also seeing some efficiency gains in our overall supply chain cost, which drove further improvement in profitability in the quarter.

  1. Financials
NameSales Growth 3Yrs %Profit Growth 3Yrs %ROE %ROCE %Debt/Equity

Zomato39.60%15.50%-5.91%-5.79%0.03
  1. Technical Analysis

Since 27 Jan 2023, Zomato has rallied 218% and share price is 149.45 and it makes its mark in stock under 150 Rs.

Pick No.3 of stock under 150 Rs: EaseMyTrip

EaseMyTrip offers an internet-based travel agent market with an Indian and a global presence. Serving more than 11 million satisfied customers. The company is the second largest online travel platform. The company was established in 2008 to address the challenges faced by smaller B2B agents by offering them an easy-to-use platform to handle all their reservations. Today, the company offers complete travel services, such as hotel reservations, airline tickets, vacation packages, tickets to trains, taxis and bus tickets and other value-added services, such as travel insurance visa processing, and tickets for attractions and activities. Let us know why it made up in our list of stock under 150 Rs?

  1. Only profitable travel agency in India

Easy Trip Planners Limited is the only major Online Travel Agency in India and one of the few worldwide that reported profits during the pandemic year of pandemic and record profits since the beginning. It is also present across every single pin code in India through agents’ networks, offices and franchises.

  1. Innovative Ideas to generate more profits

The company came up with innovative ideas. At a time of pandemic when business was low and uncertainty high. The company banked on their strong balance sheet to give advances to airlines, specifically low-cost carriers, as well as to bus operators and a few hotels that needed liquidity. This enabled the company to earn better commissions, which was an additional Rs 40 crore in FY22.

The company was the first in the industry to launch the Save Now Buy Later (SNBL) scheme with the added advantage of a discount of up to 20% on advance payments as low as Rs 100.

  1. Launched New Programs for Higher Customer Satisfaction

EaseMyTrip has launched a unique program specifically for its elite customers that is called EMTPRO. It is an invitation-only program that will see the customers accepted into a “Refer Now and Earn Forever’ program. It gives them access to discounts like special rates on flights and Hotels, Buy 2 nights get one free at over 500 hotel rooms, and additional discounts of up to 5% off of reservations for trains and buses and more. The company also launched a program exclusively for its top members – EMTFAMILY. This gives shareholders a variety of advantages like cashback for holidays, hotels, flights trains, buses, and bookings for a whole year. This is when they refer a new customer to book with EaseMyTrip.

  1. Maintains its focus on strategic marketing

EaseMyTrip became the official travel partner of the World Padel League 2023, held in June 2023 at the Coca-Cola Arena, Dubai. EaseMyTrip provided comprehensive travel solutions to players, officials and fans attending the tournament. The tournament was telecasted on Viacom Sports channel, UAE- Abu Dubai Media, Sweden Padel Television and the World League TV Channel on YouTube and provided visibility to the brand during live matches allowing it to reach millions of viewers.

  1. Lean Cost structure
  • The company offers discount at 12% less than the industry leader
  • The employee cost is less than 65% less than the industry
  • The advertisement and promotion is less than 33% than the industry
  • The other expenses is less than 20% than the industry

This makes the company’s margin superior than the other companies.

  1. Expands its Franchise store network

Following the opening of its very first Franchise location in Patna(Bihar), The business has increased its network of franchise stores by opening four new stores as franchises located in Surat (Gujarat), Jaipur (Rajasthan), Patiala (Punjab) and Ludhiana (Punjab). This is a move that is in line with the company’s expansion plans. With the franchise model, the brand hopes to connect with customers who are not in the area and provide them with personalized meet-and-greets.

  1. Strong acquistions by the company
  • Nutana Aviation Acquisition– With their diversification plan to develop a complete travel environment, they acquired a 75% stake in Nutana Aviation. It is a Gujarat-based flight charter services company. This acquisition will help the company expand their reach across the rapidly developing air charter services market worldwide.
  • CheQin Acquisition – To increase outreach across the hotels’ segment, they have acquired a 55% stake in CheQin – the real-time hotel reservations marketplace. Through CheQin’s app, users can avail good bargains for last-minute bookings with hoteliers, helping them simplify and enrich their customer experiences.
  1. Spreading their wings to New Zealand

Their global presence has now expanded to New Zealand apart from international offices in Singapore, UAE, UK, Philippines, Thailand and the USA. They have incorporated a wholly-owned foreign subsidiary in New Zealand as part of their international expansion plan to tap the renewed global demand for travel and tourism. Through this new phase of expansion, the company will float a localised travel search engine in New Zealand, to help the region’s customers to benefit from their value-added offerings. Their subsidiary will replicate the cost-effective and lean operating model with no minimum paid-up capital which they have successfully implemented in India to pass on optimal benefits to customers in New Zealand.

  1. Financials
NameSales Growth 3Yrs %Profit Growth 3Yrs %ROE %ROCE %Debt/Equity

Ease My Trip45.00%63.90%46.90%54.60%0.17
  1. Technical Analysis

The company is down by 25%+ from its all-time high.

Pick No. 4 of stock under 150 Rs: Marksans Pharma

Marksans Pharma is engaged in the business of formulation of pharmaceutical products. The primary areas of focus are on the field of OTC and prescription drugs which have a variety of uses. The fields that are relevant to the business include oncology, gastroenterology, antidiabetic, antibiotics, cardiovascular and pain management, gynecology, in addition to others.

  1. Accredited manufacturing facilities

The company has three manufacturing units – one each in India, USA and UK. All the manufacturing facilities are accredited by various health authorities of the regulated markets and are well-equipped for manufacturing tablets, caplets, capsules and pellets. The Goa facility is accredited by US-FDA, UK-MHRA, Brazil-ANVISA and Australia-TGA, while US and UK facilities are accredited by USFDA and UK-MHRA respectively.

  1. Diversified geographical presence

The company sells its portfolio of products internationally in over 50 countries, with the majority of the revenue generated from the regulated market. The company is among the top Indian pharmaceutical companies in USA and UK with products in varied therapeutic segments. The USA and UK account for around 43% and 41% of the revenue respectively. Furthermore, the company operates in Australia and New Zealand through its subsidiaries. The geographically diversified nature of revenue reduces the exposure of the company towards any adverse economic slowdown in any single geography.

  1. Planned growth strategies

The company plans to expand its current production capacity. To do this, it has purchased a manufacturing facility at Tevapharm India Private Limited. The plant is equipped with a capacity of 1.50 billion units annually and has been approved to manufacture items from the EU, Health Canada, and the Japanese Health Authority.

This project is planned to be implemented in two phases and is expected to be completed by the end of FY27. The total project cost is estimated to be about Rs450 crore, which is expected to be financed through internal accruals, cash reserves bank balances, and the proceeds from the issuance of convertible warrants.

  1. Entering new products

Marksans plans to make tablets, soft and hard liquid capsules ointments creams, and gummies using the capacity that has been added.

  1. Future Plan

It plans to expand the capacity of 8 billion units annually for items like oral solids, tablets, soft gels, etc. over the next 12-18 years. The Company is planning to purchase ANDAs to reduce the time to develop and purchase front-end distribution and marketing companies to expand to the rapidly growing market. It plans to increase its product line-up by expansion of 12-13 new products each year.

An abbreviated new drug application (ANDA) contains data which is submitted to FDA for the review and potential approval of a generic drug product.

Tie ups with strong retailers and strong acquisitions.

  • Leading OTC store brand with the customer base of leading USA retailers like Target, Walmart, Walgreens, Kroger etc.
  • Presence in the UK and Europe through two subsidiaries, Relonchem and Bells Healthcare. Bells is the largest manufacturer of private label & branded cough liquids in the UK.
  • Presence in Australia and New Zealand through subsidiary Nova Pharmaceuticals. Nova is one of the leading branded and private label suppliers in Australia to top retailers like Woolworths Ltd., Coles Mayer Ltd., Aldi, Metcash etc.
  1. Financials
NameSales Growth 3Yrs %Profit Growth 3Yrs %ROE %ROCE %Debt/Equity

Marksans Pharma17.80%30.00%18.60%22.20%0.07

Technical Analysis:

The company is in a strong uptrend and has now just broken its trendline.

It is very important to understand that any stock under 150 Rs, even those mentioned above, are highly risky as they are small cap stocks. It is advised to conduct a fundamental analysis learnt from Top 5 Online Stock Market Courses in India before investing in them.

Those who have done stock market courses online free with certificate and know about right portfolio allocation can investigate this list of stock under 150 Rs as these are for aggressive investors. If you also want to learn the art of stock selection, you can attend our stock market free webinar.

Our blogs are made for educational purposes only, and we do not provide investment recommendations. We are not SEBI-registered advisors and do not accept cryptocurrency payments. We present publicly available facts and data, not favoring any company.

more to explore

Leave a Comment

Your email address will not be published. Required fields are marked *

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Discover the 5-step stock selection process in our next webinar

Date: Tuesday, 23rd April at 7:30PM IST

We respect your privacy: Your data is secure and you can unsubscribe at any time