Everyone dreams of finding a low-priced stock that turns into a huge wealth creator. Think about how Eicher Motors, once a small company, became a major player over time. Imagine if you had bought it early! In this article, we’ll guide you through a simple strategy to find such potential “multibagger” stocks — those that can grow many times over — all while keeping the price below ₹100.
What Are We Looking For? A Multibagger Stock
We’re not just picking any cheap stock. We’re looking for quality small companies that are currently undervalued but have the potential to grow big in the future.
These stocks are called “penny stocks”, and while many of them are risky, a few hidden gems can turn out to be winners. Our goal is to find the next Eicher Motors — but at just ₹100 or less.
Step-by-Step: How to Identify These Multibagger Stocks
You can use a free website called screener.in to start your research. Here’s how:
1. Filter by Price
The first step is to narrow down to stocks that are trading under ₹100.
- On screener.in, go to the “Screens” section.
- Use this filter:
Current price < 100
This will give you a list of all stocks that are currently trading under ₹100.
2. Filter by Company Size
We don’t want to pick very tiny or unknown companies. So next, we add a filter for market size:
- Use this filter:
Market Capitalization > 100 Crores
This helps eliminate very small companies that might be too risky or illiquid (hard to sell).
3. Check for Growth and Profitability
A low price doesn’t mean it’s a good deal. We want companies that are growing and profitable. So, look for:
- Sales Growth: Check if the company’s sales have been increasing over the last 3–5 years.
- Profit Growth: Consistent profit growth shows the company is managing its business well.
- Return on Capital Employed (ROCE): A ROCE above 10–12% is a good sign of efficiency.
What to Avoid
- Companies with no real business or consistent losses.
- Stocks that have gone down sharply and show no signs of recovery.
- “Pump and dump” stocks — avoid stocks that go up suddenly without reason.
Final Tips
- Don’t put all your money in one stock — spread your investment across a few that meet the above filters.
- Do your homework — read about the company’s business, management, and past performance.
- Be patient — multibagger returns often take years to unfold.
In Simple Words
This strategy helps you filter good companies from the clutter of cheap stocks. Think of it like searching for a diamond in the rough. While there’s no guarantee, this method increases your chances of finding a company that grows significantly over time — just like Eicher Motors did.
By using simple filters and sticking to the basics, even everyday investors can take their first steps toward finding the next big winner — all while starting at just ₹100 or less.