The ‘Piotroski’ score is a discrete score between zero and nine, with nine being the best and zero being the worst, reflecting nine different criterias to determine the financial strength of a firm. Moreover, the score is used to determine stocks that could provide the best value to their holders.
Listed below are three such fundamentally strong stocks, i.e., stocks with strong financials and favourable leverage metrics, under the ‘small-cap’ category that possess a Piotroski score of ‘9’:
KNR Constructions Limited
With a market capitalization of Rs 8,033 crores, the stocks of KNR Constructions Limited, engaged primarily in the construction of roads, bridges, flyovers, etc, closed at Rs 285.65 on Friday, slipping around 2 percent as compared to the previous close of Rs 291.50 apiece. The company is rated with a Piotroski score of ‘9’.
Having a look at the financials of the company, the company has reported an increase in its operating revenues as well as net profits with the former moving up from Rs 3,605 crores during FY21-22 to Rs 4,062 crores during FY22-23, and, the latter, during the same period, shifting up from Rs 354 crores to Rs 440 crores.
Moreover, the company’s profitability ratios such as return on equity (RoE) as return on capital employed (RoCE) also increased with the former recently moving from 16.46 percent during FY21-22 to 16.53 percent during FY22-23, and, the latter, from 16.90 percent to 23.61 percent.
ISGEC Heavy Engineering Limited
With a market capitalization of Rs 6,850 crores, the stocks of ISGEC Heavy Engineering Limited, a diversified heavy engineering company engaged in manufacturing and project business, closed at Rs 931.65 on Friday, gaining around 0.50 percent as compared to the previous close of Rs 927.15 apiece. The company is rated with a Piotroski score of ‘9’.
Having a look at the financials of the company, the company has reported an increase in its operating revenues as well as net profits with the former moving up from Rs 5,499 crores during FY21-22 to Rs 6,399 crores during FY22-23, and, the latter, during the same period, shifting up from Rs 114 crores to Rs 205 crores.
Moreover, the company’s profitability ratios such as return on equity (RoE) as return on capital employed (RoCE) also increased with the former recently moving from 5.13 percent during FY21-22 to 8.52 percent during FY22-23, and, the latter, from 7.39 percent to 11.46 percent.
Neuland Laboratories Limited
With a market capitalization of Rs 6,875 crores, the stocks of Neuland Laboratories Limited, engaged in manufacturing and selling bulk drugs, closed at Rs 5,358.60 on Friday, slipping around 1.68 percent as compared to the previous close of Rs 5,450.10 apiece. The company is rated with a Piotroski score of ‘9’.
Having a look at the financials of the company, the company has reported an increase in its operating revenues as well as net profits with the former moving up from Rs 951 crores during FY21-22 to Rs 1,191 crores during FY22-23, and, the latter, during the same period, shifting up from Rs 63 crores to Rs 163 crores.
Moreover, the company’s profitability ratios such as return on equity (RoE) as return on capital employed (RoCE) also increased with the former recently moving from 7.60 percent during FY21-22 to 16.46 percent during FY22-23, and, the latter, from 9.37 percent to 20.05 percent.
Written by Amit Madnani
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