5 Stocks to Buy Under ₹500 | SEBI RA Picks | Best Stocks to Buy Right Now

Are you looking to invest in high-potential stocks without burning a hole in your pocket? You’re in the right place! In this blog post, we’ve curated a list of 5 fundamentally strong stocks under ₹500, based on insights from SEBI-registered research analysts (RA). These stocks are not only affordable but also backed by solid fundamentals, promising growth potential, and favorable risk-reward ratios.

✅ Disclaimer: This article is for informational purposes only. Always consult a SEBI-registered investment advisor before making any investment decisions.

📈 Why Focus on Stocks Under ₹500?

• Affordability: Ideal for beginner investors or those with limited capital.
• Growth Potential: Mid-cap and small-cap stocks often deliver higher returns than large-cap counterparts over time.
• Portfolio Diversification: Low-cost stocks allow for diversified investment even with smaller budgets.
• Momentum & Valuation: Many stocks under ₹500 are undervalued gems awaiting price discovery.

🔍 Selection Criteria (SEBI RA Strategy)

The following stocks were shortlisted based on:

• Strong fundamentals (ROE, Debt-Equity Ratio, Revenue Growth)
• Technical strength and favorable price action
• Institutional buying interest
• Sectoral tailwinds
• SEBI-RA reports and verified market research

📊 Top 5 Stocks Under ₹500 to Buy in 2025

💡 1. Federal Bank Ltd. (NSE: FEDERALBNK)

Current Price: ₹172 (as of May 2025)
Sector: Private Banking
Market Cap: ₹41,000 Cr+

Why Buy:

• Consistent improvement in Net Interest Margin (NIM)
• Strong presence in South India and expanding nationally
• Increasing digital adoption and retail loan book
• Clean asset quality (GNPA below 2.5%)

SEBI RA View:
Federal Bank has a solid track record with stable management and excellent loan book quality. Its valuation is cheap compared to peers like ICICI and HDFC Bank.

Target Price (12–15 months): ₹225–₹240
Risk: Low to Moderate

💡 2. Rail Vikas Nigam Ltd. (NSE: RVNL)

Current Price: ₹395 (as of May 2025)
Sector: Infrastructure / Railways
Market Cap: ₹82,000 Cr+

Why Buy:

• Government-backed PSU with strong order pipeline
• Part of India’s mega infrastructure and railway modernization plans
• Debt-free balance sheet and high ROCE
• Solid dividend-paying history

SEBI RA View:
A consistent performer in the railway space, RVNL benefits from India’s push on infrastructure. Its earnings visibility and order book growth are impressive.

Target Price: ₹470–₹500
Risk: Moderate

💡 3. BEML Ltd. (NSE: BEML)

Current Price: ₹468 (as of May 2025)
Sector: Defence / Manufacturing
Market Cap: ₹19,000 Cr+

Why Buy:

• Key player in India’s Atmanirbhar Bharat defense push
• Diversified portfolio: mining, construction, and defense equipment
• Regular government orders
• Expected benefits from privatization buzz

SEBI RA View:
Strong fundamentals and a push from government defense spending make BEML a great long-term bet.

Target Price: ₹550
Risk: Moderate to High (due to PSU nature and order volatility)

💡 4. ITC Ltd. (NSE: ITC)

Current Price: ₹429 (as of May 2025)
Sector: FMCG / Tobacco / Hotels / Paper
Market Cap: ₹5.5 Lakh Cr+

Why Buy:

• Dividend king with consistent cash flow
• Diversified business with growing FMCG and hotel segments
• Strong brand portfolio and pricing power
• Debt-free and consistent RoCE

SEBI RA View:
Despite being a large-cap, ITC is still undervalued compared to peers. Strong earnings growth in FMCG segment is driving re-rating.

Target Price: ₹500–₹520
Risk: Low

💡 5. SAIL (Steel Authority of India Ltd.) (NSE: SAIL)

Current Price: ₹142 (as of May 2025)
Sector: Steel / Metal
Market Cap: ₹58,000 Cr+

Why Buy:

• India’s infrastructure boom = higher steel demand
• Debt levels significantly reduced in past 2 years
• Good operating leverage and capacity expansion
• Priced attractively with P/E under 6

SEBI RA View:
SAIL is a value pick among PSUs. The demand-supply dynamic in steel favors the company for next 2–3 years.

Target Price: ₹180–₹200
Risk: Moderate (cyclical industry)

📌 Bonus Tip: Use SIP Strategy for Volatile Stocks

If you’re new to investing or concerned about market volatility, consider a Systematic Investment Plan (SIP) approach in stocks like SAIL, RVNL, or BEML. Buying in small quantities over time reduces average cost and manages risk better.

🧠 Pro Investor Tips from SEBI-Registered Analysts

• Always look at debt-to-equity ratio and return on capital
• Never rely solely on price — analyze the earnings and business outlook
• Don’t chase “penny stocks” blindly; value and fundamentals matter
• Review quarterly results and conference calls
• Stay updated with SEBI announcements, dividend news, and promoter activity

💼 Conclusion: Small Budget, Big Opportunities!

Don’t let a limited budget stop you from building wealth through the stock market. The stocks mentioned above are hand-picked for their value, potential, and affordability. Whether you’re a beginner or a seasoned investor looking for low-cost opportunities, these companies can offer long-term compounding if chosen wisely.

💡 Take Action: Start tracking these stocks, study their charts and reports, and consider gradually building a position.