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Top 10 Small Caps With Good Piotroski Score

17 October 20226 mins read by Angel One
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What is Piotroski score?

A Piotroski score is basically an index made out of chosen variables in the fundamental analysis of a company. It is given based on whether or not the company has the following :

1. Profitability

    1.1 Positive Net Income (1 point)

    1.2 Positive Return on Assets in the current year (1 point)

    1.3 Positive Operating Cash flow in the current year (1 point)

    1.4 Cash flow from operations that is greater than net income (1 point)

2. Leverage, liquidity and source of funds

    2.1 Long term debt in current year is lower than that in the previous year (1 point)

    2.2 Higher Current Ratio in the current year than in the previous year (1 point)

    2.3 No new shares issued last year (1 point)

3. Operating Efficiency

    3.1 Higher Gross Margin this year than the previous (1 point)

    3.2 Higher Asset Turnover Ratio this year than the previous (1 point)

Therefore, the higher the piotroski score (out of 9) the better.

What are small cap stocks?

Small cap stocks are stocks of those companies whose market capital lies below ₹5,000 cr. Small cap stocks with good fundamental features like a high Piotroski Score have the potential to grow manifold in the future and thus make for investments with high returns. 

Top 10 small cap stocks with high Piotroski score.

1. Indoco Remedies Ltd. – Piotroski Score 8

It is a ₹3,071 cr small cap company in the pharmaceuticals industry which has a P/E Ratio (TTM) of 19.79 (Industry P/E being 25.57), a P/B ratio of 3.34 and ROE of 18.5%. 

It is currently trading at a price of ₹332.60 and volume of 57,008.

2. Minda Corporation Ltd. – Piotroski Score 8

It is a ₹4,870 cr small cap company in the auto parts and equipment industry which has a P/E Ratio (TTM) of 24.27 (Industry P/E being 43.75), a P/B ratio of 3.73 and ROE of 15.50%. It is currently trading at a price of ₹203 and volume of 189,603.

3. CSB Bank Ltd. – Piotroski Score 7

It is a ₹3,751 cr small cap company in the banking industry which has a P/E Ratio (TTM) of 7.55 (Industry P/E being 9.40), a P/B ratio of 1.46 and ROE of 18.98%. It is currently trading at a price of ₹233.60 and volume of 589,084.

4. Nesco Ltd. – Piotroski Score 7

It is a ₹3,996 cr small cap company in the realty industry which has a P/E Ratio (TTM) of 19.93 (Industry P/E being 12.15), a P/B ratio of 2.35 and ROE of 11.72%. It is currently trading at a price of ₹559.75 and volume of 28,409.

5. Mahindra Logistics Ltd. – Piotroski Score 7

It is a ₹3,741 cr small cap company in the transportation and logistics industry which has a P/E Ratio (TTM) of 90.93 (Industry P/E being 21.23), a P/B ratio of 6.33 and ROE of 6.4%. It is currently trading at a price of ₹528.95 and volume of 233,539.

6. Heidelberg Cement India Ltd. – Piotroski Score 7

It is a ₹4,293 cr small cap company in the cement industry which has a P/E Ratio (TTM) of 18.25 (Industry P/E being 17.74), a P/B ratio of 2.74 and ROE of 16.49%. It is currently trading at a price of ₹186.60 and volume of 426,937.

7. Tata Coffee Ltd – Piotroski Score 7

It is a ₹4,200 cr small cap company in the coffee industry which has a P/E Ratio (TTM) of 25.61 (Industry P/E being 19.79), a P/B ratio of 2.77 and ROE of 10.23%. It is currently trading at a price of ₹219.95 and volume of 439,936.

8. Hikal Ltd. – Piotroski Score 6

It is a ₹4,142 cr small cap company in the pharmaceuticals industry which has a P/E Ratio (TTM) of 40.98 (Industry P/E being 25.57), a P/B ratio of 3.88 and ROE of 16.04%. It is currently trading at a price of ₹326 and volume of 102,377.

9. Vakrangee Ltd. – Piotroski Score 6

It is a ₹3,655 cr small cap company in the commercial services and supplies industry which has a P/E Ratio (TTM) of 40.42 (Industry P/E being 26.31), a P/B ratio of 1.33 and ROE of 4.05%. It is currently trading at a price of ₹35.25 and volume of 65,93,695.

10. Star Cement Ltd. – Piotroski Score 6

It is a ₹4,280 cr small cap company in the cement industry which has a P/E Ratio (TTM) of 17.42 (Industry P/E being 17.74), a P/B ratio of 1.97 and ROE of 11.63%. It is currently trading at a price of ₹104.10 and volume of 183,187.

Conclusion

Piotroski score is a useful but not sufficient tool to make trading decisions in the stock market, especially when it comes to small cap companies. If you want to experience more accurate real life trading, try opening a demat account with a trusted broker.

Disclaimer: This blog is exclusively for educational purposes. The securities quoted here are only exemplary and not recommendatory.

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