Piotroski 8/9 Screen: Quality at Low P/E

An old broker in Fort once told me he did not buy stories. He bought scorecards. The Piotroski F-Score is that scorecard. Right now, eight Indian large caps printed 8 out of 9 on the Piotroski screen. The list isn't a single sector call. It includes consumer staples, IT services, banking, and power generation. That mix matters because the screen is not chasing one macro theme. It is picking up companies where accounting quality is improving and valuations have not run away. The Piotroski 8/9 screen names include ITC, TCS, SBI, Infosys, HDFC Bank, Kotak Mahindra Bank, Axis Bank, and NTPC. ITC and TCS are the headline pair. Both carry ROE readings near 48-50% and P/E multiples around 17. That combination is unusual in large-cap India. High ROE names usually trade well above 20 times earnings. SBI is the value flag on this list at 11.42 times trailing earnings. The state-owned lender has been through asset quality cycles before, and the current score suggests its balance sheet is healing faster than the price implies. How the Piotroski 8/9 screen works The F-Score is a nine-point checklist built from financial statement data. It rewards positive operating cash flow, rising return on assets, falling debt ratios, higher gross margins, and better asset turnover. A score of 8 or 9 is rare for large caps. Most companies score 4 to 6. When a mega-cap scores 8, the screen is saying the reported profit has real cash behind it and the balance sheet is getting stronger, not stretched. There is a catch. The F-Score is backward-looking. It tells you what improved over the last twelve months. It does not tell you when the market will care. That is why pairing it with valuation matters. [ITC](/stock/ITC) (NSE: ITC) is the best example. A decade ago, the stock was a cigarette cash machine with an unloved FMCG business. The consumer goods division has since built scale. The hotel business has recovered. The market has begun to reprice the earnings. The 8/9 score indicates the unde...