2 Small Cap Stocks To Buy That Could Potentially Double Investor Wealth

One of the reasons to recommend buying these stocks is that these stocks have fallen sharply over the last few months and if they go back to their previous highs, they could double investor wealth. Having said that the stocks are fundamentally sound and readers will see that as they read along. Here are 2 such stocks.

Krsnaa Diagnostics: Top player in the diagnostics space

The stock of Krsnaa Diagnostics has fallen from levels of Rs 965 to the current levels of Rs 482. Should it go back to Rs 965, it would have doubled investor wealth. Potentially, it can because of its rapid expansion plans. The company has good public private partnership plan and has tie-ups with various state governments. It has won orders in Maharashtra and needs to deploy 31 CT scan and operate 8 government installed CT scan across 39 government hospitals. Apart from the tender won in Maharashtra, the company also won tenders from the States of Rajasthan, Tripura and Delhi.

Krsnaa Diagnostics: Good expansion plans

The company is expanding its presence and during the quarter they added 6 radiology centers, 58 tele-reporting centers, 3 pathology labs, and 27 collection centers. As of today, Krsnaa is a leading PPP diagnostic player with 113 radiology centers, 1,439 tele-reporting centers, 53 processing labs, and 613 pathologic collection centers. For the quarter ending June 30, 2022,m the performance of the company was good, despite a drop in Covid revenues. The first quarter FY2023 sales and profitability of, Krsnaa's core business of radiology and pathology, registered Revenues of Rs. 113 crores, a growth of 10.5% on a year-on-year basis, and 6% on a sequential basis.

Krsnaa Diagnostics: Attractive on valuations

The stock of Krsnaa Diagnostics has fallen as mentioned earlier, substantially from higher levels. In fact, the shares had got listed at over Rs 1000, a few months back. The price to earnings ratio for KRSNAA Diagnostics is now 23 times, which is reasonable for a fast growing company. For FY 2023-24, with the contracts seeing fructification, there is a potential for good earnings growth. Buy the stock for long-term returns.

Sportking India

The shares of the company have dropped from levels of Rs 2046 to the current market price of Rs 919. Nothing has changed fundamentally at the company, despite the stock price falling. It is one of the top textiles related exporter, with strong marquee clients that include Jokey, Zara, Ikea, H&M etc. It has well diversified range of products suitable for use in manufacture of woven and knitted fabrics for summer and winter wear. The company has over the years systematically expanded from 6520 in 1994 to 2,74,400 in 2022, while boosting profitability.

Sport King India: Cheap on valuations

For the quarter ending June 30, 2022, the company saw net profits move higher from Rs 79 crores to Rs 83 crores. The EPS for the quarter was Rs 63. It's highly possible that the company can report an EPS of Rs 250 of thereabouts for FY 2022-23. This means the stock is available at a price to earnings ratio of under 4 times given that the stock is trading at Rs 919. The p/e of the company is rather cheap at the current levels which makes the shares an attractive buy. At the same time the company is also undertaking expansion in spindles, which should augur well for it in the coming years. Buy the stock for potential of doubling investor wealth.