Before buying any small-cap stock, ask these 8 questions:

1. Is revenue growing consistently, or just in one good year?

2. Is profit growing faster than revenue?

3. Is the company generating cash, not just accounting profits?

4. Is debt manageable?

5. Do promoters have skin in the game?

6. Is the company gaining market share in a growing industry?

7. Would you be comfortable holding it if the stock fell 50% tomorrow?

8. Can you explain the business to a 12-year-old in two minutes?

If the answer to several of these questions is "No" or "I don't know," you may need more research.

Small caps don't become multibaggers because they are small.

They become multibaggers because they become better businesses.

Feel free to add any points I may have missed. I am always interested in learning how other investors evaluate small-cap opportunities 😊