3 Midcap Stocks with high Piotroski score to Add to Your Watchlist

As you move down the market-cap ladder from largecaps to smallcaps and microcaps, both risk and potential returns naturally rise.

If you're looking for a mix of growth and stability-something that isn't too safe but not too risky either-midcap stocks often strike the right balance.

That said, finding solid midcap stocks in a crowded market can be tricky. One useful tool to make this easier is the Piotroski Score.

So, what is the Piotroski Score?

Created by Professor Joseph Piotroski, it's a simple way to gauge a company's financial health. The score looks at nine factors to see if a company is improving or facing trouble. These include:

• Profitability: Is the company making money and earning good returns?
• Cash Flow: Does it generate enough cash from operations?
• Debt Management: Is it reducing long-term debt?
• Liquidity: Are short-term assets growing relative to liabilities?
• Equity Issuance: Has it avoided diluting shareholders by issuing new shares?
• Operational Efficiency: Are margins and asset use improving?

Each factor gives one point, so a company can score between 0 and 9. The higher the score (7-9), the stronger the financial health. A low score (0-3) signals red flags.

Keeping this in mind, here are 3 midcap stocks with high Piotroski Scores that are worth adding to your watchlist.

Company Name	Industry/Segment	Piotroski Score
National Aluminium Company (NALCO)	Metals & Mining	9
KPIT Technologies	Information technology	9
Multi Commodity Exchange (MCX)	Financial Services	9

Source: Equitymaster

#1 National Aluminium Company (NALCO)

First on the list is National Aluminium Company (NALCO).

NALCO is a Schedule A Navratna CPSE. It's present in mining, metals, and power. It's under the ownership of the Ministry of Mines, Government of India, which has a 51.28% stake.

The company is the country's largest integrated bauxite-alumina-aluminium-power complex, with bauxite mining, alumina refining, aluminium smelting, and casting.

NALCO has a high Piotroski score of 9, which indicates solid financial health.

Over the past five years the company has seen good growth. Its revenue has jumped from Rs 89,558 million (m) in FY21 to Rs 167,876 m in FY25, a CAGR of 14.75%.

Meanwhile, net profit has soared from Rs 12,994 m to Rs 52,679 m, a CAGR of 107.7%.

The company's five-year average ROE and ROCE stand at 18% and 23.5%, respectively, while maintaining a debt-free balance sheet.

NALCO Financial Snapshot (FY21-25)

Source: Equitymaster

NALCO has announced a Rs 300 billion (bn) capital expenditure plan over 4-5 years, focusing on expanding mining, refining, smelting, and power capacity.

The company aims to double its smelting capacity and increase alumina refining. NALCO is also venturing into lithium exploration in Argentina through KABIL, a joint venture.

The expansion includes diversification into value-added products, sustainability initiatives, and strategic partnerships for raw material procurement. This is to boost production capacity, optimise costs, and strengthen NALCO's global presence.

NALCO has also set an ambitious target for production and capacity expansion to produce over 16,000 tonnes of wire rods annually.

For more details, see the NALCO quarterly results and NALCO share price.

#2 KPIT Technologies

Next on the list is KPIT Technologies.

The company is an India-based independent software development and integration company.

KPIT Technologies provides embedded software for the automobile and mobility industry. Its solutions and services include autonomous driving and advanced driver assistance systems (ADAS), conventional and electric powertrains, cockpit systems and more.

KPIT offers comprehensive support for vehicle body and gateway systems, spanning concept development to maintenance for both current and next-generation automotive programs.

The company boasts a Piotroski Score of 9, reflecting strong financial health and efficient operations.

On the financial front, KPIT has delivered robust growth over the past five years. Revenue has surged from Rs 20,357 m in FY21 to Rs 58,423 m in FY25, representing a CAGR of 22.1%.

Net profit has also risen sharply, from Rs 1,471 m to Rs 8,396 m, marking a CAGR of 41.6%.

The company's five-year average ROE and ROCE stand at 23.1% and 31.8%, respectively, while maintaining a debt-free balance sheet.

KPIT Technologies Financial Snapshot (FY21-25)

Source: Equitymaster

Recently, KPIT Technologies acquired OXI SRL Italy through its subsidiary, KPIT Technologies (UK) Limited, in a US$ 6 m deal, strengthening its global presence and technological depth.

This follows its earlier acquisition of Caresoft subsidiaries in the USA, UK, and Mexico for US$ 51 m, reflecting the company's continued commitment to strategic global expansion.

With a strong balance sheet, consistent profitability, and a Piotroski Score of 9, KPIT Technologies is a midcap stock to watch in India's fast-growing automotive tech landscape.

For more details, see the KPIT TECHNOLOGIES company fact sheet and quarterly results.

#3 Multi Commodity Exchange of India

Last on the list is Multi Commodity Exchange (MCX).

MCX is India's largest commodity derivatives exchange and ranks as the world's sixth largest by the number of commodity derivative contracts traded.

MCX operates an online trading platform regulated by the Securities and Exchange Board of India (SEBI). It provides a transparent and efficient market for trading commodity derivatives across multiple segments, including bullion, industrial metals, energy, and agricultural commodities.

MCX facilitates price discovery and risk management for participants in the commodity ecosystem. It is India's first exchange to introduce commodity options and futures contracts on bullion, base metals, and energy indices.

The company boasts a Piotroski Score of 9, reflecting strong financial health and efficient operations.

On the financial front, MCX has delivered robust growth over the past five years. Revenue has surged from Rs 3,906 m in FY21 to Rs 11,127 m in FY25, representing a CAGR of 22.8%.

Net profit has also risen sharply, from Rs 2,252 m to Rs 5,600 m, marking a CAGR of 18.8%.

The company's five-year average ROE and ROCE stand at 10.1% and 12.5%, respectively, while maintaining a debt-free balance sheet.

MCX Financial Snapshot (FY21-25)

Source: Equitymaster

Looking ahead, the company could be a key beneficiary of regulatory reforms. Media reports suggest that SEBI may soon allow banks, pension funds, and foreign portfolio investors (FPIs) to participate in commodity trading-moves expected to boost liquidity and attract greater foreign investment.

As India's leading commodity exchange, MCX is well-positioned to benefit from higher trading volumes and new product opportunities, making it a strong midcap stock to watch.

For more details, see the MULTI COMMODITY company fact sheet and quarterly results.

Other Midcap Stocks to Watch

Apart from these, AWL Agri Business, IPCA Labs, and GE Vernova T&D also feature among midcap companies with a strong Piotroski Score of 9.

Conclusion

Midcap stocks often strike the right balance between growth and stability, they're typically more established than smallcaps but still have plenty of room to expand compared to largecaps.

In these cases, the company's high Piotroski Score underscores its strong financial health, efficient operations, and clean balance sheet, traits that make it stand out in the midcap segment.

However, investors should also assess the stock's valuation, industry prospects, and earnings visibility before making a move.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

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