Having zero debt or very little debt can grant a company financial stability in the long term. Debt can help to fuel growth and offer tax advantages, but it also carries risks like potential insolvency and financial strain. Only a small handful of public companies today have zero or near-zero debt.
Piotroski score, named after Stanford accounting professor Joseph Piotroski, is a number between ‘0’ and ‘9’ used to assess the strength of a company’s financial position. Financial investors use the score to find the best-value stocks.
Listed below are such debt-free stocks with a high Piotroski score of upto 9:
Quick Heal Technologies Ltd
With a market capitalization of Rs. 2,557 crores, the shares of the security software company started Friday’s trading session on a higher note at Rs. 438.90 compared to its previous close of Rs. 435.90. During the trading session, the shares hit a high of Rs. 478.60, gaining around 9 percent and closed the day at Rs. 474 apiece. The shares have a high Piotroski score of 7’.
Looking at the company’s financial statements, the revenue decreased marginally by 2 percent from Rs. 82 crores during the December quarter to Rs. 80 crores in the March quarter. Contrastingly the net profits increased by 40 percent from Rs. 10 crores to Rs. 14 crores during the same period.
Coming onto the important ratios, the company has a debt-to-equity ratio of ‘zero’ which means that the business hasn’t relied on borrowing to finance operations. Furthermore, the return on equity (RoE) was at 5.54 percent during FY 23-24 and the return on capital employed was recorded (RoCE) at 5.99 percent during the same period.
According to the BSE data, Ace Investor Mr Mukul Agrawal entered the stock in March 2024, by acquiring approximately 7 lakh equity shares equivalent to a 1.31 percent stake in this company. The current holding value of his investment amounts to Rs. 30.6 crores.
Maharashtra Seamless Ltd
With a market capitalization of Rs. 9,179 crores, the shares of Steel Pipes manufacturing company started Friday’s trading session on a higher note at Rs. 697.10 compared to its previous close of Rs. 689.80. During the trading session, the shares hit a low of Rs. 686.05, losing around 1 percent and closed the day at Rs. 688. The shares have a high Piotroski score of 8’.
Looking at the company’s financial performance, the revenue decreased by 15 percent from Rs. 1,431 crores during the December quarter to Rs. 1,215 crores in the March quarter. Additionally, the net profits declined by 21 percent from Rs. 276 crores to Rs. 218 crores duirng the same time frame.
Coming onto the important ratios, the company has a debt-to-equity ratio of ‘zero’ which means that the business hasn’t relied on borrowing to finance operations. Furthermore, the return on equity (RoE) was at 16.60 percent during FY 23-24 and the return on capital employed was recorded (RoCE) at 20.36 percent during the same period.
Moreover, the company possesses an order book valued at Rs. 1,754 crores. It retains a market share of 55 percent in the seamless pipes segment, supported by manufacturing facilities located in Nagothane and Mangaon, Maharashtra, as well as Narketpally, Telangana.
RPG Life Sciences Ltd
With a market capitalization of Rs. 2,514 crores, the shares of the pharmaceutical company started Friday’s trading session on a higher note at Rs. 1,545.80 compared to its previous close of Rs. 1,535.80. During the trading session, the shares hit a low of Rs. 1,519, losing around 1 percent and closed the day at Rs. 1,524 apiece. ‘The shares have a high Piotroski score of 9’.
Looking at the company’s financial statements, the revenue decreased by 18 percent from Rs. 154 crores during the December quarter to Rs. 127 crores in the March quarter. On the other hand, the net profits declined by 50 percent from Rs. 26 crores to Rs. 13 crores during the same timeframe.
Coming onto the important ratios, the company has a debt-to-equity ratio of ‘zero’ which means that the business hasn’t relied on borrowing to finance operations. Furthermore, the return on equity (RoE) was at 23.4 percent during FY 23-24 and the return on capital employed was recorded (RoCE) at 31 percent during the same period.
Furthermore, the company has identified 70 products for a three-year product grid, focusing on new product launches and line extensions and the management has set an ambitious target of reaching Rs. 1,000 crores turnover.
Written By Vaibhav Patil
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