India’s microcap space — made up of companies with a market cap between Rs 1 billion (bn) and Rs 10 bn — is often overlooked, but it’s full of potential.
Despite their smaller size, many of these companies have delivered strong returns, with a few turning into multibaggers over just a few years.
From 2020 to 2023, quite a few microcaps managed to outperform the broader market, backed by solid earnings and support from trends in specific sectors.
Now, as we move into 2025, investors are starting to take notice of some fundamentally sound microcap names that have clean balance sheets, improving margins, and business models that can scale well over time.
Considering this, we applied a screener to identify fundamentally strong microcap stocks having three-year revenue and profit compounded average growth rate (CAGR) of more than 10% and debt to equity ratio less than 1.
So, let’s take a look at five such stocks.
#1 DroneAcharya Aerial Innovations
First on this list is DroneAcharya.
DroneAcharya is a drone solution provider, certified by the Directorate General of Civil Aviation (DGCA), specializing in drone pilot training, supply, services, and manufacturing.
Their offerings include drone sales, maintenance, and project-based work in oil & gas and GIS (Geographic Information System) data processing sectors.
They also provide post-training consultancy to help pilots transition into the industry.
Coming to the financials, the company’s revenue has grown at a CAGR of 1,421.1% in the last three years while its net profit has grown at a CAGR of 349.1%.
The company’s three-year average return on equity (RoE) and return on capital employed (RoCE) were 7.6% and 10.2%, respectively.
DroneAcharya Stock Price – 1 Year
DroneAcharya is expanding internationally, securing a US$ 1.8 m deal with American Blast Systems to strengthen its global presence.
Additionally, the company is diversifying into defence and security, with an order from Reliance Industries’ security associates for drone-based surveillance solutions.
In January 2025, DroneAcharya signed a strategic merger with AVPL International to combine R&D, infrastructure, and talent development, strengthening their drone industry presence.
It is also developing FPV drones, loitering munitions, and anti-drone solutions to meet rising defence sector demands.
The company is leveraging AI for crop health assessment and developing digital platforms to support farmers.
Also, it’s exploring nanosatellites to expand into the growing space tech market.
#2 Spright Agro
Second on this list is Spright Agro.
Spright Agro develops agricultural and forestry operations.
The company plants, grows, cultivates, produces and breeds various agricultural and forestry crops, horticultural crops, greenhouses, net houses, medicinal and aromatic plants in owned and/or leased farms.
It operates as a manufacturer, importer and exporter, wholesaler, retailer, and trader of all types of agricultural and other commodities.
It has a presence in 16 states and is associated with over 8,000 farmers.
Coming to the financials, the company’s revenue has grown at a CAGR of 501.2% in the last three years while its net profit has grown at a CAGR of 283.7%.
The company’s three-year average RoE and RoCE were 11.9% and 12.9%, respectively.
Spright Agro Stock Price – 1 Year
Spright Agro plans to acquire additional land to expand its contract farming activities. This move is expected to increase the company’s revenue by approximately 10–15% in the upcoming financial year.
The company is committed to entering new international markets and establishing strategic partnerships.
By creating robust distribution networks, Spright Agro aims to bring its high-quality products to a broader audience.
#3 Drone Destination
Next on this list is Drone Destination.
Drone Destination is India’s largest drone pilot training, and leading Drone-as-a-Service (DAAS) company.
Along with its sister concern, Hubblefly Technologies, a DGCA-approved manufacturer, it has developed an integrated drone eco-system built around drone manufacturing, certified training, and drone as a service.
The company has recently forayed into agri drone services and partnered with Indian Farmers Fertilizer Cooperative Limited (IFFCO).
It has deployed more than 200 drones and pilots and executed more than 25,000 agriculture drone demonstrations in Uttar Pradesh, to push for agriculture drone adoption in rural India.
Its DGCA-certified drone pilots offer professional, drone spray services conducted as per the SOPs released by the Ministry of Agriculture & Farmer Welfare.
The company is India’s first DGCA-authorized drone training organization, and is currently present in 12 cities.
It’s also the largest flight training organisation under central Ministry of Civil Aviation at Raebareli, IFFCO, and Sanskardham. It has certified over 3,000 drone pilots, including more than 800 women drone pilots in the country.
Coming to the financials, the company’s revenue grew at a CAGR of 333.1% in the last three years while its net profit grew at a CAGR of 538.7%.
The company’s three-year average RoE and RoCE were 69.6% and 27.6%, respectively.
Drone Destination Stock Price – 1 Year
Drone Destination intends to establish a network of more than 150 drone hubs across India, and more than 25 drone hubs internationally by FY27, offering drone sales, after-sales & maintenance, training and services.
Additionally, the company plans to establish over 1,000 fixed and mobile “Drone Hubs” across India by 2026.
In July 2024, Drone Destination signed a Memorandum of Understanding (MoU) with the National Small Industries Corporation (NSIC) to establish a state-of-the-art drone training center in New Delhi.
This initiative focuses on comprehensive training in drone technology, including repairs, maintenance, data analysis, and remote pilot training, aiming to empower individuals and organizations in the drone sector.
In September 2024, Drone Destination partnered with DeHaat, a leading agritech platform, to integrate drone technology into Indian agriculture.
This collaboration aims to offer drone spraying services and promote DeHaat’s agricultural products, enhancing farm productivity and sustainability for over 2.7 million (m) farmers across eleven states.
#4 20 Microns
Fourth is 20 Microns.
20 Microns is India’s sole & largest manufacturer of micronized to nano-sized minerals, having expertise across the entire process from mining to micronization, including sub-micron and nanosizing.
The company has more than 200 clients including Asian Paints, Berger Paints, Finolex, JK Tyres, Finolex, Supreme, etc.
It operates nine advanced manufacturing units and twelve warehouses across India with a production capacity of 450,000 metric ton per annum (MTPA).
It also has five captive mines across Rajasthan, Gujarat, Tamil Nadu, and Andhra Pradesh with reserves totaling 17 m tons.
The company generates 48% of its total revenue from paints, 25% from polymers, and 5-9% from rubber, paper, ceramics and others.
Coming to the financials, the company’s revenue has grown at a CAGR of 15.9% in the last three years while its net profit has grown at a CAGR of 30.7%.
The company’s three-year average RoE and RoCE were 15.2% and 19.6%, respectively.
20 Microns Stock Price – 1 Year
In November 2024, the company incorporated a joint venture (JV) namely Sievert 20 Microns Building Materials Pvt Ltd, to manufacture construction chemicals and building material products.
In Q3 FY25, the company completed the acquisition of a 90% stake in Goh Teik Lim Quarry and an 86.7% stake in IQ Marbles through its Malaysian subsidiary, 20 Microns SDN BHD.
The mining operations associated with this acquisition are expected to commence by mid-2025. Additionally, steps are ongoing to acquire remaining minority stakes.
20 Microns has planned a capex of Rs 700-800 m, to be incurred over Q3 FY25 to Q4 FY26.
This includes Rs 250 m for the acquisition of a mine in Malaysia, ongoing capacity expansions for existing products, enhancements for the nano product range, investments in new construction chemicals JV with Sievert’s Germany, R&D upgrades, and infrastructure improvements.
The company plans to do capex of Rs 150–180 m in 20 Microns Nano Minerals Limited for setting up a calcination facility for the rubber industry and specialized Kaolin grades for paints, using new technology.
The management expects 15–18% YoY growth for FY26, maintaining the historical trend.
The value-added niche segments are also guided to grow at 18–20% CAGR over the next 2–3 years, though management notes that product approvals here take longer.
The management expects improved raw material security and potential for higher margins once mining commences.
Despite intensifying competition in the paint sector, low per capita paint consumption in India signals strong long-term growth potential, and 20 Microns is confidently positioned to capitalize on this opportunity.
With a broad product basket tailored for each customer, strong DSIR-recognized R&D capabilities in Vadodara, and the ability to deliver import-substitute solutions, 20 Microns is well-positioned to drive cross-selling, deepen customer integration, and support localization efforts.
Despite ongoing challenges from raw material imports, freight cost inflation, and forex volatility, margins have been maintained.
#5 Mindteck (India)
Last on this list is Mindteck (India).
Mindteck is a certified engineering and technology solutions company which specializes in embedded systems, enterprise applications, testing, and professional services provided to Fortune 1000 companies, start-ups, universities, and government entities worldwide.
Mindteck offers electronic design, firmware, and software services across key sectors such as life sciences, analytical instruments, semiconductor fab equipment, medical instruments, and high-end storage products.
Additionally, it specializes in supporting and maintaining enterprise-wide applications.
Mindteck also focuses on providing solutions to independent software vendors in the banking and financial services Industry. This includes custom application development, management, reengineering, as well as validation and verification services.
Lastly, it provides offshore-based employee resourcing, marketing, pre-sales support, and other services to its subsidiaries.
The company has strategic partnerships and alliances with Intel Partner Alliance, Microsoft Gold Application Development Partner, etc.
The company’s revenue has grown at a CAGR of 10.3% in the last three years while its net profit has grown at a CAGR of 28.9%.
The company’s three-year average RoE and RoCE were 10.2% and 13.6%, respectively.
Mindteck (India) Stock Price – 1 Year
Mindteck is intensifying its focus on sectors such as life sciences, healthcare technology, industrial automation, and data storage.
In recent months, the company has secured engagements with twenty two top-tier clients across these domains, reflecting its commitment to delivering cutting-edge solutions and driving value for its clients.
The company is enhancing its capabilities in the healthcare sector by focusing on advanced image processing, predictive healthcare, and developments in cloud and edge computing.
These initiatives aim to meet the evolving needs of the industry and strengthen Mindteck’s position in the healthcare technology space.
Mindteck is actively involved in smart city projects too, including the implementation of India’s first-ever smart parking solution for a large municipal corporation.
The company has also registered a new entity, Hitech Parking Solutions Pvt. Ltd., to conduct business activities related to this project.
In March 2025, Mindteck announced the resignation of its Managing Director and CEO, Anand Balakrishnan. This leadership change indicates a potential shift in the strategic direction for the company.
Conclusion
While microcap stocks come with inherent volatility and liquidity risks, those backed by strong fundamentals, prudent management, and clear growth visibility can deliver exceptional long-term returns.
As India’s economic momentum continues into 2025, well-positioned microcaps in niche or emerging sectors may offer investors early access to the next wave of market leaders.
However, due diligence, risk management, and a long-term investment horizon are key when navigating this segment.
Additionally, 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.
Keeping an eye on these fundamentally sound companies could prove rewarding as they scale new heights in the coming years.
Happy investing.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here…
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