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I hear a lot of beginner investors talking about penny stocks and which are the best penny stocks to buy now in 2021 but most people don't understand the basic concepts of investing in penny stocks in India. When you buy a share (stock) of a company, you buy a part of the business and if the business does well, the stock eventually performs. So it doesn't really matter if you buy one share of a company or 1000 shares, ultimately the growth of business matters.
Most people think of penny stocks as multi-bagger stock as most of the time, when we look back and check the stock price of successful companies, we see their stock price selling under 1 rupee ₹2 or ₹5 rupees (typical stocks selling at penny prices - that looks undervalued and in cheap valuation). However, that's the effect of stock split and stock bonus offered to the investors who's been investing in that company for the long term.
