Even though smallcaps underperformed benchmarks in 2022, falling nearly 18 percent versus a 3 percent rise in benchmarks, some smallcap and penny stocks have been able to generate extraordinary returns for its investors. Four little-known penny stocks, each have given 1,200-2,000 percent returns to its investors just in 2022.
However, it is important to note that these are mainly small-cap/penny stocks. While investors have made huge profits on such stocks, it is key to remain cautious and vigilant.
Overall, the market has been on a volatile track in 2022 due to soaring inflation which triggered sustained rate hikes which, in turn, have raised fears of a recession in the US and Europe. Moreover, geopolitical tensions, rich valuations and worries over domestic economic growth, too, have weighed on sentiment.
Now, let's take a look at these star performers of the year:
Hemang Resources: Shares of coal supplier Hemang Resources have given extraordinary returns to its investors in 2022 even though the year saw massive volatility and a number of headwinds. The stock surged from ₹3 in December last year to around ₹63 currently, rallying as much as 2,047 percent year-to-date (YTD). This implies that an investment of ₹10,000 in this penny stock in December last year would have turned into ₹2.14 lakh this year. The rise in its stock price came on the back of a significant rise in its revenue over the past few quarters and reduced debt. Hemang Resources Limited engages in the coal trading business in India. It operates through two segments, coal trading and infrastructure. The company sells imported and indigenous coal. It also trades in land; and provides stevedoring and logistic services.
Kaiser Corp: Shares of packaging firm Kaiser Corporation rallied 1,679 percent in 2022, from ₹2.8 in December 2021 to currently trade around ₹49. This implies that an investment of ₹10,000 in this penny stock in December last year would have turned into ₹1.77 lakh this year. While the stock has been majorly volatile in 2022, it gave multibagger returns in first 4 months of the year, rising 4,579 percent between January-April. Kaiser Corporation Limited, through its subsidiaries, provides turnkey project management and engineering services in India. It operates in two segments, Printing and Infrastructure Projects. Kaiser Corporation Limited was incorporated in 1993 and is based in Mumbai, India.
SEL Manufacturing: Shares of textile firm SEL manufacturing has surged over 1,427 percent in 2022, up from ₹42 in December 2022 to ₹646 in December currently. This implies that an investment of ₹10,000 in this penny stock in December last year would have turned into ₹1.52 lakh this year. The stock has risen 26 percent in December so far after falling for 7 consecutive months since May. In this period, it lost, 70 percent. However, it gave multibagger returns between January-April 2022, up 3,915 percent in these 4 months. SEL Manufacturing Company Limited engages in the spinning, knitting, and processing of yarns and fabrics in India and internationally.
Alliance Integrated Metaliks: The penny stock rallied from ₹2.7 in December last year to currently trade around ₹40, giving as much as 1,377 percent returns to its investors. This implies that an investment of ₹10,000 in this penny stock in December last year would have turned into ₹1.47 lakh this year. Alliance Integrated Metaliks Limited engages in the power ancillary equipment and engineering fabrication businesses in India. The company was formerly known as B. S. Holdings and Credit Limited and changed its name to Alliance Integrated Metaliks Limited in 2004. It was incorporated in 1989 and is based in New Delhi, India.
Disclaimer: This story is for educational purposes only. Please speak to an investment advisor before making any investment decisions.