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Top Fundamentally Strong Stocks under ₹500 in India

The top fundamentally strong stocks under ₹500 in India are those with robust financials, consistent earnings and low debt. These stocks offer potential for growth and stability, making them attractive for long-term investors seeking affordable investment opportunities with solid market prospects.

The table below shows the top fundamentally strong stocks below ₹500 in India based on market capitalization.

NameMarket Cap (Cr)Close Price (Rs)1Y Return %
ITC Ltd6,02,563.97481.60.91
NTPC Ltd3,29,541.20339.8510.99
Oil and Natural Gas Corporation Ltd3,25,690.85258.8924.32
Wipro Ltd3,07,666.04294.4533.27
Power Grid Corporation of India Ltd2,93,945.58316.0533.33
Coal India Ltd2,42,595.80393.652.37
Bharat Electronics Ltd2,13,408.99291.9560.1
Hindustan Zinc Ltd1,98,230.84469.1547.16
Indian Oil Corporation Ltd1,95,070.79138.144.1
Vedanta Ltd1,78,901.91458.2573.71

Table of Contents

What are Fundamentally Strong Stocks under Rs 500?

Fundamentally strong stocks under ₹500 are companies with solid financial health, including stable revenue, consistent profits and a strong market position. These stocks often have a low debt-to-equity ratio, high return on equity (ROE) and robust business models.

Investors look for companies with clear growth potential and an efficient management team. Stocks priced below ₹500 can be attractive for those seeking quality investments at an affordable price, making them a popular choice for value investors aiming for long-term capital appreciation.

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Features of Fundamentally Strong Stocks below ₹500

The main features of fundamentally strong stocks below ₹500 include solid financials, consistent earnings growth, strong market position and effective management. These stocks provide potential for long-term capital appreciation while being priced affordably for retail investors.

  • Solid Financials: Fundamentally strong stocks exhibit stable cash flows, low debt and healthy profit margins. This ensures a sustainable business model that can weather economic downturns.
  • Consistent Earnings Growth: These stocks show a history of steady profit growth over time, indicating the company’s ability to generate value and improve its financial standing in the market.
  • Strong Market Position: Companies with a dominant or competitive position in their industry tend to outperform. This leads to more resilience against competition and greater market share.
  • Effective Management: A capable and experienced management team can successfully navigate market challenges and implement strategies that ensure sustainable growth and higher shareholder returns.

How to Identify Fundamentally Strong Stocks under ₹500?

To identify fundamentally strong stocks under ₹500, investors should analyze key financial metrics such as high return on equity (ROE), low debt-to-equity ratio, consistent revenue growth and profitability. Stocks with a strong market position and competitive advantage are favourable choices.

Additionally, it’s important to evaluate management quality, industry trends and the company’s ability to withstand market volatility. Analyze price-to-earnings (P/E) ratios and compare them to industry averages for better insights. Researching company news, performance reports and broader economic factors also helps identify strong potential stocks for long-term investment.

Best Fundamentally Strong Stocks under 500 Rs

The table below shows the best fundamentally strong stocks below ₹500 in India based on a 1-month return.

Name1M Return (%)Close Price (Rs)
Hindustan Petroleum Corp Ltd7.47413.05
ITC Ltd4.7481.6
Wipro Ltd2.88294.45
Ashok Leyland Ltd2.42234.13
Union Bank of India Ltd0.39124.06
Indian Oil Corporation Ltd-0.17138.14
Rail Vikas Nigam Ltd-2.19432.1
Vedanta Ltd-2.98458.25
Power Grid Corporation of India Ltd-3.65316.05
Bharat Electronics Ltd-3.76291.95

Top 10 Strong Fundamental Stocks under ₹500

The table below shows the top 10 strong fundamentally strong stocks below ₹500 in India based on a 5-year net profit margin.

Name5Y Avg Net Profit Margin %Close Price (Rs)
Power Grid Corporation of India Ltd31.67316.05
ITC Ltd26.64481.6
Oil India Ltd20.72481.1
Coal India Ltd18.38393.65
Bharat Electronics Ltd15.94291.95
Wipro Ltd14.24294.45
NTPC Ltd11.03339.85
Gail (India) Ltd9.28191.09
Bank of Maharashtra Ltd9.1955.13
Oil and Natural Gas Corporation Ltd6.15258.89

Fundamentally Strong Stocks below ₹500 List

The table below shows a list of the best fundamentally strong stocks below ₹500 in India based on a 6-month return.

Name6M Return (%)Close Price (Rs)
Hindustan Petroleum Corp Ltd25.26413.05
Suzlon Energy Ltd15.7361.95
ITC Ltd12.44481.6
Wipro Ltd9.26294.45
Rail Vikas Nigam Ltd3.63432.1
Ashok Leyland Ltd2.03234.13
Vedanta Ltd-1.22458.25
Oil India Ltd-2.87481.1
Power Grid Corporation of India Ltd-5.7316.05
Oil and Natural Gas Corporation Ltd-5.76258.89

Factors to Consider When Investing in Fundamentally Strong Stocks Below 500 Rs

The main factors to consider when investing in fundamentally strong stocks below ₹500 include valuation, industry trends, risk factors and dividend potential. These elements help determine whether the stock is worth the investment for both short- and long-term objectives.

  • Valuation: Analyze the stock’s current market price relative to its earnings, assets and growth potential. A fair valuation ensures you’re not overpaying for the stock.
  • Industry Trends: Understanding the industry’s performance, growth trajectory and prospects helps gauge the stock’s potential for sustained success.
  • Risk Factors: Assess external and internal risks, such as regulatory changes, market competition, or economic conditions, that may affect the stock’s performance and stability.
  • Dividend Potential: Look at the company’s history of paying dividends and its payout ratio. Companies that offer consistent dividends can provide regular returns in addition to capital appreciation.

Who Can Invest in Fundamentally Strong Stocks under ₹500?

Fundamentally strong stocks under ₹500 can be attractive to both individual and institutional investors. Beginner investors looking to diversify their portfolios with affordable yet strong options can also consider such stocks, especially those with long-term investment goals.

Experienced investors seeking growth opportunities while mitigating risk can also focus on these stocks. Investors should conduct thorough research and understand the financial health, market trends and potential of the companies. Ideally, these stocks suit individuals who prioritize solid fundamentals over short-term market fluctuations.

How to Invest in Fundamentally Strong Stocks below ₹500?

To invest in fundamentally strong stocks below ₹500, follow these steps:

  • Open a Demat and Trading Account: Choose a brokerage platform like Alice Blue and complete the KYC process to start trading.
  • Research the Stocks: Analyze the company’s financials, industry position and valuation to ensure it meets fundamental strength criteria.
  • Place Your Buy Order: Log in to your trading account, search for the stock and specify the number of shares you want to purchase.
  • Monitor Your Investment: Regularly track the stock’s performance and market news to make informed decisions on holding or selling.
  • Brokerage Tariffs: Please note that Alice Blue’s updated brokerage tariff is now Rs. 20 per order, which will apply to all trades.

Advantages of Investing in Fundamentally Strong Stocks under 500 Rs

The main advantages of investing in fundamentally strong stocks below ₹500 include affordability, growth potential, lower risk and portfolio diversification. These stocks provide opportunities for both long-term capital appreciation and steady returns, making them attractive to investors with various risk tolerances.

  • Affordability: Stocks priced under ₹500 are more accessible for investors with a smaller budget, allowing them to invest in quality companies without a large capital outlay.
  • Growth Potential: Many fundamentally strong stocks under ₹500 belong to growth-oriented companies, offering higher potential for future appreciation as they expand and improve profitability.
  • Lower Risk: Companies with strong fundamentals tend to have a more stable business model, lower debt and healthy financials, which reduces the overall risk of investment.
  • Portfolio Diversification: These stocks can add variety to your portfolio, helping to balance high-risk, high-return investments and offering stability through established companies.

Risks of Investing in Fundamentally Strong Stocks below ₹500

The main risks of investing in fundamentally strong stocks below ₹500 include market volatility, low liquidity, sector-specific risks and overvaluation. These factors can lead to potential price fluctuations and loss of value, impacting long-term investment returns.

  • Market Volatility: Stocks, even with strong fundamentals, can experience price fluctuations due to economic conditions, market sentiment, or geopolitical events, which can lead to losses for investors.
  • Low Liquidity: Stocks under ₹500 may have fewer buyers and sellers, which can lead to difficulty in executing trades at favourable prices, especially during high-volume transactions.
  • Sector-Specific Risks: Stocks in particular sectors can be exposed to risks such as regulatory changes, technological disruptions, or supply chain challenges that may affect their performance despite strong fundamentals.
  • Overvaluation: Even fundamentally strong stocks can become overvalued during periods of market optimism, leading to potential price corrections and exposing investors to the risk of purchasing at an inflated price.

Introduction to Fundamentally Strong Stocks under ₹500

ITC Ltd

ITC Ltd, established in 1910, is one of India’s largest conglomerates with a diverse portfolio spanning FMCG, hotels, paperboards, packaging and agribusinesses. The company’s brands like Aashirvaad, Sunfeast and Classmate are market leaders, while its hotels and paper products contribute significantly to its revenue.

ITC Ltd. reported a total revenue of ₹21,351.8 crore in the Sep ’24 quarter, up from ₹19,152.2 crore in Jun ’24. However, the net profit decreased slightly to ₹4,992.9 crore compared to ₹5,091.6 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹16.42
  • Return on Equity (ROE): 28.33%

NTPC Ltd

NTPC Ltd, founded in 1975, is India’s largest power generation company. It is engaged in the generation, transmission and distribution of electricity and has a significant share in India’s total power capacity. NTPC focuses on expanding its renewable energy capacity while maintaining its thermal power assets.

NTPC Ltd. reported a total revenue of ₹45,197.8 crore in the Sep ’24 quarter, a decrease from ₹48,981.7 crore in Jun ’24. Net profit also saw a slight decline, reaching ₹5,274.6 crore, compared to ₹5,474.1 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹21.46
  • Return on Equity (ROE): 13.17%

Oil and Natural Gas Corporation Ltd

Oil and Natural Gas Corporation Ltd (ONGC), established in 1956, is India’s top oil and gas exploration and production company. It operates in both upstream and downstream sectors, providing crucial energy resources for India’s growing economy, while also focusing on sustainable energy solutions.

Oil and Natural Gas Corporation Ltd. reported a total revenue of ₹162,492.5 crore for Sep ’24, a decline from ₹169,562.3 crore in Jun ’24. However, the net profit increased slightly to ₹10,272.5 crore, compared to ₹9,936.5 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹39.13
  • Return on Equity (ROE): 14.73%

Wipro Ltd

Wipro Ltd, founded in 1945, is a leading global information technology, consulting and business process services company. With a presence in over 50 countries, Wipro delivers cutting-edge solutions across industries, specializing in cloud, cybersecurity, automation and digital transformation.

Wipro Ltd. reported a total revenue of ₹23,263.5 crore for Sep ’24, showing an increase from ₹22,693.5 crore in Jun ’24. Net profit also rose, reaching ₹3,208.8 crore, compared to ₹3,003.2 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹10.31
  • Return on Equity (ROE): 14.5%

Power Grid Corporation of India Ltd

Power Grid Corporation of India Ltd, founded in 1989, is a state-owned electric utility company. It owns and operates the vast majority of India’s transmission network, ensuring the reliable distribution of power across the country and playing a key role in the growth of the national energy grid.

Power Grid Corporation of India Ltd. reported a total revenue of ₹11,845.9 crore in Sep ’24, up from ₹11,279.6 crore in Jun ’24. Net profit increased to ₹3,793 crore, compared to ₹3,723.9 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹16.74
  • Return on Equity (ROE): 18.3%

Coal India Ltd

Coal India Ltd, established in 1975, is the world’s largest coal producer, with operations spanning across India. It plays a vital role in the country’s energy sector, supplying coal for power generation, cement production and other industries, while focusing on sustainable mining practices.

Coal India Ltd. reported a total revenue of ₹32,177.9 crore for Sep ’24, down from ₹38,349.2 crore in Jun ’24. Net profit decreased to ₹6,289.1 crore, compared to ₹10,959.5 crore in the previous quarter.

Key metrics: 

  • Earnings Per Share (EPS): ₹60.69
  • Return on Equity (ROE): 51.52%

Bharat Electronics Ltd

Bharat Electronics Ltd (BEL), established in 1954, is a state-owned aerospace and defence company. It designs and manufactures advanced electronic products for the defence and civilian sectors, contributing to India’s defence capabilities with cutting-edge technology in radar systems, communication equipment and more.

Bharat Electronics Ltd. reported a total revenue of ₹4,762.7 crore in Sep ’24, up from ₹4,447.2 crore in Jun ’24. Net profit increased to ₹1,092.5 crore, compared to ₹791 crore in the previous quarter, showing positive financial growth.

Key metrics: 

  • Earnings Per Share (EPS): ₹5.45
  • Return on Equity (ROE): 26.37%

Hindustan Zinc Ltd

Hindustan Zinc Ltd, a subsidiary of Vedanta Group, was established in 1966. It is India’s largest producer of zinc and silver, with operations in mining, smelting and refining. The company is a leader in the production of non-ferrous metals, contributing significantly to the global supply chain.

Hindustan Zinc Ltd. reported a total revenue of ₹8,522 crore for Sep ’24, slightly up from ₹8,398 crore in Jun ’24. Net profit remained stable at ₹2,327 crore, compared to ₹2,345 crore in the previous quarter, reflecting steady performance.

Key metrics: 

  • Earnings Per Share (EPS): ₹18.35
  • Return on Equity (ROE): 55.17%

Indian Oil Corporation Ltd

Indian Oil Corporation Ltd (IOCL), founded in 1959, is the largest oil refining and marketing company in India. It operates across the entire petroleum supply chain, from refining to marketing and distribution, playing a key role in ensuring the country’s energy security.

Indian Oil Corporation Ltd. reported a significant decline in net profit for Sep ’24, posting a loss of ₹169.6 crore compared to a profit of ₹3,528.5 crore in Jun ’24. Total revenue decreased to ₹175,699.4 crore from ₹194,377.6 crore.

Key metrics: 

  • Earnings Per Share (EPS): ₹30.3
  • Return on Equity (ROE): 25.19%

Vedanta Ltd

Vedanta Ltd, established in 2003, is a global natural resources company. It operates in sectors like metals, oil and gas, power and zinc. With a strong presence in India and internationally, Vedanta is committed to sustainable development and maximizing the value of its resources.

Vedanta Ltd. saw an increase in total revenue for Sep ’24, reaching ₹38,934 crore, compared to ₹36,698 crore in Jun ’24. Net profit also grew significantly to ₹4,352 crore, up from ₹3,606 crore in the previous quarter, showcasing positive financial performance.

Key metrics: 

  • Earnings Per Share (EPS): ₹11.4
  • Return on Equity (ROE): 9.27%
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Fundamentally Strong Stocks under ₹500 – FAQs

1. What are the Best Fundamentally Strong Stocks under 500 Rs?

The best fundamentally strong stocks under ₹500 #1 ITC Ltd
The best fundamentally strong stocks under ₹500 #2 NTPC Ltd
The best fundamentally strong stocks under ₹500 #3 Oil and Natural Gas Corporation Ltd
The best fundamentally strong stocks under ₹500 #4 Wipro Ltd
The best fundamentally strong stocks under ₹500 #5 Power Grid Corporation of India Ltd

The best fundamentally strong stocks under ₹500 are based on market capitalization.

2. What are Fundamentally Strong Stocks below ₹500?

Fundamentally strong stocks under ₹500 based on a 1-month return include Hindustan Petroleum Corp Ltd, ITC Ltd, Wipro Ltd, Ashok Leyland Ltd and Union Bank of India Ltd.

3. What are the Top 5 Fundamentally Strong Stocks under ₹500?

The top 5 fundamentally strong stocks under ₹500 based on a 5Y average net Profit Margin typically include Power Grid Corporation of India Ltd, ITC Ltd, Oil India Ltd, Coal India Ltd and Bharat Electronics Ltd.

4. How to Invest in Fundamentally Strong Stocks under 500 Rs in India?

To invest in fundamentally strong stocks under ₹500, first research companies with solid financials. Open a Demat and trading account with a broker like Alice Blue. Once you’ve selected your stocks, place a buy order through your trading platform to invest in them.

5. Can Fundamentally Strong Stocks Below ₹500 Be Overvalued?

Yes, even fundamentally strong stocks below ₹500 can be overvalued if the market prices them higher than their intrinsic value. It’s crucial to analyze key financial metrics like price-to-earnings ratio (P/E) and price-to-book ratio (P/B) to ensure proper valuation.

6. How Does Market Volatility Impact Fundamentally Strong Stocks under 500 Rs?

Market volatility can impact even fundamentally strong stocks under ₹500, causing temporary price fluctuations. However, these stocks often bounce back quickly due to their solid financial foundation. Investors should remain patient and focused on long-term growth despite short-term market movements.

7. Is It Good to Invest in Fundamentally Strong Stocks under ₹500?

Yes, investing in fundamentally strong stocks under ₹500 can be a good strategy. These stocks offer lower entry points, reducing initial investment risk while providing exposure to companies with sound financial health, growth potential and stability, making them suitable for long-term investors.

8. Can I Buy Fundamentally Strong Stocks under ₹500?

Yes, you can buy fundamentally strong stocks under ₹500. Many stocks in this price range offer significant potential for growth. Be sure to research the company’s financial health, growth prospects and market performance before making an investment decision.

  

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Disclaimer: The above article is written for educational purposes and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.

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