Indian Penny Stocks on a Roll as They Double in Value from 30-60 Percent Reports PennyStocksHub.com

San Francisco, CA -- (SBWIRE) -- 10/08/2012 -- Penny shares in India are enjoying a boom, with about 100 stocks rising 30% to 60%.

Market observers warn that such stocks are vulnerable to manipulation despite limits on daily price changes.

“The nature of penny stocks is such,” said G Chokkalingam, Centrum Wealth Management CIO, “that even if retail investors manage to make money in a few, they invariably lose money in the final reckoning as these stocks are easy targets for manipulators.”

Penny stocks that recorded returns more than 80% in September include Arcuttipore Tea, Gujarat Carbon and Nikki Global Finance, The Economic Times reported.

Stimulus policies by the European Central Bank and the U.S. Federal Reserve appear to have improved the mood of the markets.

During the market downturn in 2008, many small investors took losses when the Sensex plunged more than 52% and BSE small-cap dropped 72%. Now small investors are returning. Still, they are advised to check out companies before buying into them and to avoid penny stocks.

“Retail investor interest in equity markets has gone up over the past few days,” Anand Rathi, chairman of AnandRathi, told The Times. “However, we advise them to invest only in companies with good corporate governance and sound fundamentals.”

The volume of trade in penny stocks rose dramatically in September. Arcuttipore Tea reached an average volume of 65,000 in September, up from 3,000 in July and August. Divine Multimedia’s average volume in September rose to almost 10 times earlier levels.

Also enjoying quick rises in volume and price were Gujarat Capital Ventures, Nivyah Infra and Sybli Tinds.

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