SmallCap Hunter : Trying to find the dark horses with triggers

There is no one answer to this question and it is a very difficult question.

For most of micro-cap counters, financials will not be in place, if they had been then it would not be a micro-cap in the first place.

So, different counters have different interesting observations.

But most important of these is the promoter integrity. Sooner or later this comes into play.
Also at some point, either 3/5/6 years down the line financials also have to come into picture, market will only recognize once financials start falling into place.

So my thought process is to buy the scrip to keep it in satellite portfolio, atleast give it a 0.1% allocation.
Because companies out of sight are out of mind and there are hundreds to watch in this space.

So I can give 0.1% to a micro cap based on several parameters →
AGM sends out a positive note on promoter, the way promoter speaks his body language depth of his answers, how he answers to questions from his shareholders, promoter buying continuously from market from several years, some JV, good set of quarterly results, induction of a reputed person as director as board member, niche sector, leadership position in very small sector, open offer where net worth of promoter is big, open offer from new promoter who has existing set of decent business, change of business setup, big land bank, significant assets in books, an existing nano/micro cap investor having position.

Above are only very few parameters to look at that I can think of right now.
But there are many.

Once the company is in portfolio, then real research starts, with competitive advantage, checking promoter integrity, scuttlebutt with employees/dealers, attending AGMs.

All this is is a multi year process and based on conviction, either I increase my position or decrease my position.

And then comes the toughest part of holding these micro-caps with a timeline of 5/7/10 years and continuously monitoring the events in the company.

Even after such a process, if I am able to make money on 50% of my scrips, I will lend up making huge sum of money. And most of time many are failures.

So this is the process, but it is worth the pain as most money is made in market in scrips where no-one is looking at them.