Piotroski 8/9: HDFC Bank, SBI & ITC Show ROE Muscle

Piotroski 8/9 Stocks: What the Score Actually Means The Piotroski F-Score is a nine-point checklist built by Stanford accounting professor Joseph Piotroski in 2000. Each point tests something specific: profitability, operating efficiency, balance sheet health. Score an 8 or 9, and a company has passed nearly every fundamental test that separates genuinely strong businesses from ones that merely look decent on the surface. Right now, six Indian names sit at that 8/9 mark: [HDFC Bank](/stock/HDFCBANK), [SBI](/stock/SBIN), [ITC](/stock/ITC), [Kotak Mahindra Bank](/stock/KOTAKBANK), [Axis Bank](/stock/AXISBANK), and [NTPC](/stock/NTPC). Yesterday's piece covered TCS and Infosys. Today, these six deserve the same scrutiny, because the numbers tell a more interesting story than the headlines suggest. What makes this cohort worth paying attention to isn't just the F-Score in isolation. It's the combination of that score with return on equity and valuation. A company can pass eight Piotroski checks and still be expensive. The question an investor should ask is: am I paying a fair price for this quality? For at least three names here, the answer leans yes. ITC: 49.8% ROE at 17.57x Earnings Is Unusual Let's start with the number that stands out most. NSE: ITC is generating a return on equity of 49.8%, meaning for every hundred rupees of shareholder equity on its books, it's producing nearly fifty rupees of profit. That's an exceptional capital efficiency figure for a conglomerate with cigarettes, hotels, FMCG, and agribusiness under one roof. And it's trading at a P/E of 17.57x. For context, most FMCG peers with ROE in the 30-40% range trade at 40-60x earnings. ITC's discount to that band has historically been attributed to ESG concerns around its tobacco business. That's a legitimate debate. But from a pure fundamentals standpoint, a Piotroski 8/9 company with near-50% ROE at sub-18x earnings is the kind of setup that value investors spend years waiting for. FairStock's...