Penny stocks are high-risk investments. However, it can be worth holding a few within a diversified portfolio as they occasionally go on to be ‘multibaggers’ – rising multiple times their initial price.

Here, I’m going to highlight a penny stock where I see multibagger potential in the long run. Could it be worth considering as a growth play for a Stocks and Shares ISA or a Self-Invested Personal Pension (SIPP)?

A ‘triple bagger’ in just two years

The stock in focus is Made Tech (LSE: MTEC), a small British technology company that helps the UK government and regulated companies with digital transformation.

Currently, it’s trading for around 49p. That’s up from 16p two years ago, meaning that it has been a ‘triple bagger’ (rising three times its initial price) over that period.

Why the stock’s surging

It’s easy to see why the share price has soared over the last few years. For a start, revenue’s skyrocketed as the UK government has scrambled to get itself fit for the digital age.

For the year ended 31 May (FY26), revenue amounted to £58.9m (ahead of market expectations in August). That figure was up 27% year on year and up 51% on the figure two years ago.

Second, the company has become profitable. And profits are soaring. For FY26, net profit’s expected to be £3.8m – 170% higher than in FY25. The fact that the company’s now profitable – and profits are growing – has massively de-risked the stock.

Potential for further gains

Looking ahead, I expect Made Tech’s revenues to continue growing at a rapid rate. Given that it specialises in data, AI, and cloud computing, the backdrop should be very favourable as, let’s face it, many government systems (eg the NHS) are behind the curve when it comes to technology.

It’s worth noting that in August the company won the largest contract award in its history. This was with a UK government department and is expected to be worth £40m over four years.

“The UK public sector is entering a multi-decade AI transformation, creating a substantial long-term opportunity for trusted delivery partners like Made Tech.”

Made Tech CEO Rory MacDonald

If revenues continue rising in the years ahead at a double-digit annual growth rate, profits should rise significantly too. This should lead to further gains for the share price.

Taking a long-term view, I wouldn’t be surprised to see the share price hit £1. Note that the price-to-earnings (P/E) ratio’s relatively low at 16 today, so there’s scope for that to rise and that could help push the stock up.

What could go wrong?

Now, my bull case here assumes that the UK government continues to spend money on technology and digital transformation in the years ahead. I think it’s highly likely it will but there are no guarantees, of course.

I like the risk/reward set-up though. It’s not a stock I’d bet my life savings on, but a small position within a diversified portfolio could be worth considering.

Should you invest £5,000 in Made Tech Group Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Made Tech Group Plc made the list?

Edward Sheldon does not hold any positions in the companies mentioned.