Top NSE Government Penny Stocks Below 100 to Watch For in 2025

Investing in government penny stocks in India can be a good opportunity for investors looking to explore the potential of small cap stocks. If you’re wondering what are penny stocks, they are low-priced stocks that typically trade for less than ₹100 per share. While penny stocks often come with high risks, they also present unique opportunities for substantial gains, especially when backed by government influence or public-sector enterprises.

In this article, we’ll explore some government penny stocks worth considering in 2025, provide a government penny stock list, and discuss tools like a stock screener and how a stock market advisor can guide investment decisions.

What Are Penny Stocks?

Before diving into specific stocks, it’s important to understand what are penny stocks. Penny stocks are low-cost shares issued by small-cap companies, often with a market price of less than Rs.100. These stocks are known for their high volatility and potential for rapid price appreciation. Government penny stocks, specifically, are those issued by public-sector undertakings (PSUs) or companies with significant government ownership.

Why Invest in Government Penny Stocks?

Government penny stocks offer a relatively safer bet in the high-risk world of penny stock investing. Here’s why:

• Government Backing: Companies backed by the government are less likely to default or go bankrupt, offering investors a safety cushion
• Growth Potential: Many public-sector companies operate in sectors like energy, infrastructure, and defense, which are critical to India’s economic growth.
• Affordable Entry Point: These stocks allow one to own shares in established companies without a hefty price tag.

Government Penny Stock List for 2025

Here are some government penny stocks that may be considered for 2025 to invest in:

Bank of Maharashtra

Bank of Maharashtra is a public sector bank headquartered in Pune, India. Established in 1935, it offers various banking services, including deposits, loans, and investment products. The bank has a strong presence across India, with a vast network of branches and ATMs.

Market Cap (Rs Cr) as of 26.01.25	CMP (Rs)As of 26.01.25	Debt-to-Equity	PE Ratio	ROE (%)	ROCE ( %)	3 Yr return (%)
₹37,389	₹48.6	14.0	7.09	22.8	5.38	32

Source: Screener

Bank of Maharashtra reported a revenue of ₹6,325 crore for the quarter ending December 2024, reflecting a 22.3% increase compared to ₹5,172 crore in the same quarter of the previous year. The net profit also surged by a significant 36% to ₹1,412 crore for the quarter, up from ₹1,038 crore in the corresponding period last year. Additionally, the bank’s Gross NPA declined from 2.04% in December 2023 to 1.80% in December 2024.

Know More:  SEBI Registered investment advisory |  Stock investment advisory

Indian Overseas Bank

Indian Overseas Bank (IOB) is a prominent public sector bank in India, headquartered in Chennai. Founded in 1937, it offers various banking services, including deposits, loans, and investment products. IOB has a substantial presence across India,  with a vast network of branches and ATMs.

Market Cap (Rs Cr) as of 26.01.25	CMP (Rs)As of 26.01.25	Debt-to-Equity	PE Ratio	ROE (%)	ROCE ( %)	3 Yr return (%)
₹94,570	₹50.0	11.3	30.6	9.98	5.41	33

Source: Screener

Indian Overseas Bank posted a revenue of ₹7,112 crore for the quarter ending December 2024, marking a 15.2% growth from ₹6,176 crore in the same quarter of the previous year. Net profit increased by 20% to ₹874 crore, compared to ₹723 crore in the corresponding period last year. The bank also saw a significant improvement in asset quality, with Gross NPA reducing from 3.90% in December 2023 to 2.55% in December 2024.

Central Bank of India

Central Bank of India is one of India’s largest public sector banks, established in 1911.  It was the first commercial bank in India to be wholly owned and managed by Indians. The bank offers various banking services, including deposits, loans, and investment products. The Central Bank of India has a vast network of branches nationwide. 

Market Cap (Rs Cr) as of 26.01.25	CMP (Rs)As of 26.01.25	Debt-to-Equity	PE Ratio	ROE (%)	ROCE ( %)	3 Yr return (%)
₹44,751	₹51.5	12.5	12.3	8.71	5.29	34

Source: Screener

Central Bank of India registered a revenue of ₹8,542 crore for the quarter ending December 2024, reflecting a 9% increase from ₹7,842 crore in the same quarter of the previous year. The net profit rose significantly by 31% to ₹966 crore, up from ₹738 crore in the corresponding period last year. The bank also demonstrated notable improvement in asset quality, with Gross NPA declining from 4.50% in December 2023 to 3.87% in December 2024.

UCO Bank

Market Cap (Rs Cr) as of 26.01.25	CMP (Rs)As of 26.01.25	Debt-to-Equity	PE Ratio	ROE (%)	ROCE ( %)	3 Yr return (%)
₹51,352	₹42.9	10.5	22.2	6.22	5.34	47

Source: Screener

UCO Bank achieved a revenue of ₹6,220 crore for the quarter ending December 2024, reflecting a 12% increase from ₹5,552 crore in the same quarter a year earlier. The net profit surged by 27% to ₹639 crore, up from ₹503 crore during the corresponding period last year. Additionally, the bank significantly improved its asset quality, with Gross NPA dropping from 3.85% in December 2023 to 2.91% in December 2024.

NHPC Limited

NHPC Limited is India’s premier hydropower company, responsible for planning, promoting, and developing hydroelectric power. Established in 1975, it plays a crucial role in India’s energy sector by harnessing the power of water. NHPC has expanded its operations to include other renewable energy sources like solar, wind, and geothermal, contributing significantly to India’s sustainable energy goals.

Market Cap (Rs Cr) as of 26.01.25	CMP (Rs)As of 26.01.25	Debt-to-Equity	PE Ratio	ROE (%)	ROCE ( %)	3 Yr return (%)
₹75,077	₹74.8	0.85	25.2	9.61	7.67	36

Source: Screener

NHPC Ltd. reported a revenue of ₹3,052 crore for the quarter ending September 2024, registering a 4.12% growth compared to ₹2,931 crore in the same quarter the previous year. However, net profit fell 36% to ₹1,069 crore, down from ₹1,693 crore in the corresponding period last year.

Tools to Analyze Government Penny Stocks

When considering investments in penny stocks, it’s vital to leverage the right tools and strategies. Here are a few essentials:

Stock Screener

A stock screener allows investors to filter stocks based on market capitalization, price-to-earnings ratio, and volume. Using a stock screener can help identify promising government penny stocks that align with your investment goals.

Stock Market Advisor

Working with a stock market advisor can provide expert insights into the potential risks and rewards of investing in penny stocks. Advisors can guide you through market trends and offer tailored recommendations.

Financial Ratios

Analyze financial ratios such as debt-to-equity, return on equity (ROE), and earnings per share (EPS) to evaluate a company’s financial health.

News and Updates

Monitor government policies, sectoral developments, and announcements that might impact public-sector companies.

Risks Associated with Penny Stocks

Investing in penny stocks comes with its share of risks. Here’s what you should be aware of:

• High Volatility: Prices can swing wildly due to low liquidity.
• Limited Information: Penny stocks often lack comprehensive financial disclosures, making it harder to assess their true value.
• Speculative Nature: These stocks are often driven by market sentiment rather than fundamentals.

While government penny stocks may mitigate some of these risks due to their public-sector backing, remaining cautious and diversifying your investments is essential.

• Start Small: Begin with a small investment and gradually increase as you gain confidence.
• Diversify Your Portfolio: Don’t put all your eggs in one basket. Spread your investments across multiple small-cap stocks to reduce risk.
• Stay Informed: Regularly monitor news, financial reports, and government announcements.
• Use Tools: Employ a stock screener and seek guidance from a stock market advisor to make informed decisions.
• Focus on Long-Term Growth: Penny stocks may not deliver overnight returns. Patience is key.

India’s economic growth trajectory and infrastructure push under government programs like “Make in India” and “Atmanirbhar Bharat” could provide a strong tailwind for small-cap stocks, including government penny stocks. Moreover, sectors like renewable energy, defense, and transportation are expected to see significant investments, benefiting many public-sector companies.

Government penny stocks may be a good addition to your investment portfolio in 2025 because of their affordability and growth potential. However, they are also risky, and it’s important to balance the potential rewards with the risks involved.

FAQs on Government Penny Stocks

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