Popees Cares: Penny Stock to Multibagger! A Jaw-Dropping 8,861% Surge from ₹1.8 to ₹161.3 – Is This the Next Big Investment?

Popees Cares has gone from being a small, overlooked penny stock to a huge success story, offering massive returns for investors. This remarkable rise highlights the power of penny stocks to create significant wealth, though it comes with high risks.

In the last four years, the stock price of Popees Cares has jumped an incredible 8,861%, rising from ₹1.8 in August 2020 to ₹161.30 today. This impressive growth makes it one of the most profitable stocks in the penny stock category.

Back in August 2021, Popees Cares was trading at ₹2.5. Since then, the stock has soared by 6,352%. This steady rise over time shows the company’s ability to bring in large profits for its investors.

Popees Cares: Short-Term Gains

Even in the short term, Popees Cares has delivered strong performance. In the last year alone, the stock rose by 1,634%. Since the start of 2024, the stock has gained over 181%, despite facing losses in two of the eight months.

August has been a particularly good month, with the stock rising by almost 22%, following a 35% gain in July. Though the stock dropped 22% in June, it recovered by 20.7% in May and 6.7% in April, after a 27% dip in March. Earlier in the year, the stock surged 51% in February and had a massive 54% rally in January.

Popees Cares reached a new all-time high of ₹161.30 on August 14, 2024. This marks a 1,601% increase from its 52-week low of ₹9.48, recorded on August 16, 2023. This impressive track record shows the stock’s ability to bring huge returns despite market fluctuations.

Important Notice: ESM Stage 2

Even though Popees Cares has performed exceptionally well, it’s important to note that the stock is under ESM: Stage 2.

What is ESM?

The Enhanced Surveillance Measure (ESM) is a system put in place by India’s National Stock Exchange (NSE) to keep a close watch on certain companies and protect investors.

In Stage I, trading in these stocks happens on a “trade-for-trade” basis with a small price band of 5% or 2%.

In Stage II, trading happens on all trading days through periodic call auctions, with a trade-for-trade settlement and a 2% price band. In the past, trading was limited to once a week in this stage.

About Popees Cares

Popees Cares Limited is an Indian company that specialises in baby care products. They offer a variety of items, including infant clothing like dungarees, shirts, shorts, sleep suits, party wear, t-shirts, and pants. They also sell baby care products such as fabric wash, wipes, shampoo, body wash, bathing bars, glycerin soaps, diapers, and herbal powders, as well as newborn jhablas.

Popees Cares also offers kids’ fashion, including casual dresses, bloomers, unisex cotton jhablas, baby boy dungarees, printed t-shirts, and girls’ tops and skirts. Additionally, the company sells accessories, gift essentials, and ride-on toys. Their products are available in physical stores and online.

The company was originally known as Archana Software Limited but rebranded as Popees Cares Limited in April 2024. It was founded in 1994 and is based in Kozhikode, India.

The company’s board recently approved a proposal to raise funds through a rights issue of equity shares, with a total amount not exceeding ₹50 crore, pending necessary approvals.

Earnings and Financial Performance

In the June quarter (Q1FY25), Popees Cares reported a net loss of ₹5.1 crore, the same as in the same period last year. The company did not disclose its total revenue for the quarter but recorded ₹1 lakh in revenue in the same period last year.

Brokerage Opinions

ICICI Direct has a positive outlook on Popees Cares, praising its strong momentum. The stock has consistently stayed above its short, medium, and long-term moving averages, indicating strong performance. The company has improved its Return on Capital Employed (RoCE) over the past two years, making it more appealing as an investment.

However, ICICI Direct has noted a few concerns:

• The company has seen a decline in both revenue and profit.
• Popees Cares has a low Piotroski score, signalling weak financial health.
• The company is struggling with negative net cash flow.

Investing in Penny Stocks

Penny stocks like Popees Cares can provide high returns with a small initial investment, but they come with significant risks. To succeed in this high-risk market, investors must thoroughly research the company, understand its financial health, and evaluate its market position.

Careful risk management, realistic expectations, and a disciplined approach can help investors make the most of these opportunities while protecting their investments from potential losses.