Infibeam Avenues shares experienced a significant surge on Monday, attracting considerable attention from market investors.
The Indian stock market occasionally features stocks with the potential for substantial future returns despite their low current prices. These are commonly known as "penny stocks." While they carry higher risk, informed decisions at the right time can yield significant benefits for investors.
Today, we discuss Infibeam Avenues Limited, currently trading below ₹25, but with potential for substantial growth in the coming days. A key factor driving this potential is the company's proposed rights issue, with a meeting scheduled for June 19, 2025.
Surge Following Rights Issue Announcement
By Monday afternoon, Infibeam Avenues shares were trading at ₹22.60, up approximately 3.5%. This surge followed the company's announcement of key information regarding its rights issue to the stock market. The company revealed that its rights issue committee would meet on June 19, 2025, to finalize the issue price, record date, entitlement ratio, and other terms.
Following this news, investor interest increased, and the share price briefly surged by more than 5%, reaching ₹22.95.
Rights Issue Expectations
Infibeam Avenues has already stated its intention to raise ₹700 crore through a rights issue of equity shares with a face value of ₹1. This capital will be procured through the rights issue. A rights issue allows existing shareholders to purchase new shares at a discounted price, potentially leading to better returns in the future.
The June 19 meeting will determine the offer period, the number of shares each investor is entitled to, and the issue price. Favorable terms for investors could lead to further share price appreciation.
Recent Performance: Volatile but Hopeful
Infibeam Avenues' recent performance has been mixed. The stock has seen a 20% increase over the past month and approximately 26% growth over the past three months. However, since the beginning of 2025, it has experienced a decline of roughly 13%.
Over the past year, there has been a 27% decline. However, a long-term perspective reveals better performance; the stock has yielded 55% returns over the past two years and approximately 85% over the past five years.
Company Background and Business
Infibeam Avenues is a digital payments and e-commerce solutions provider operating in India and several other countries. Its services include online payment gateways, billing, banking technology, and digital platforms.
Furthermore, its subsidiary, CCAvenue, is considered one of India's largest payment gateways. With the growth of Digital India, the sector's potential is continuously expanding, benefiting players like Infibeam.
Is Now the Right Time to Invest?
The low price and potential rights issue have placed this stock on investors' radar. If you are willing to accept risk and invest with a long-term perspective, this stock may present an opportunity. Favorable pricing and terms following the rights issue could lead to a significant upswing.
However, it is crucial that investors avoid impulsive decisions. It is essential to examine the stock's current trends and fundamentals. Infibeam's business model and future are intertwined with Digital India; therefore, its trajectory will depend to some extent on the growth of technology and digital transactions.
Understanding and Managing Risk
The primary challenge with penny stocks is their volatility. These stocks can rapidly fluctuate upwards or downwards. Therefore, if you are considering investing in this stock, develop a clear strategy regarding your investment amount. Under no circumstances should a significant portion of your portfolio be invested in these stocks.
