Microcaps! A word, also a segment of the market, which is believed to be riskier than walking in a tight rope between two skyscrapers. Yet if you make it through, well, there’s potentially big rewards at the end of that walk. And that’s the allure of microcaps.

It’s not surprising therefore, that microcaps draw a lot of interest from investors.

Today we look at 2 Microcap stocks that were able to grab the attention of FIIs in the last quarter, even as FIIs were huge sellers in the market. And this attention, turned into a spike in FII holdings for these microcap stocks.

One of these microcaps is from the Pharma industry and the other from IT. These to stocks probably check most boxes in the checklist for becoming the next possible multibagger. Do you own any?

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Sotac Pharmaceuticals Ltd

Incorporated in 2015, and listed on NSE in April 2023, Sotac Pharmaceuticals Ltd manufactures and sells a wide range of pharmaceutical products.

With a market cap of Rs 125 cr, Sotac Pharmaceuticals Ltd has an enviable clientele and performs manufacturing activities for over 160 corporate pharmaceutical clients on a contract-manufacturing and/or loan license basis.

The FII holding of Sotac Pharma went from 8.8% in the quarter ending September 2024 (Company reports half yearly numbers) to 15.12% as of the quarter ending March 2025. That is a big jump in a single quarter.

CRAFT EMERGING MARKET FUND PCC- ELITE CAPITAL FUND bought a fresh 6.4% stake in Sotac Pharma worth Rs 8 cr, as per the exchange filings made for the quarter ending March 2025.

The company’s performance could be the reason behind this buy decision.

The sales for Sotac Pharma grew from Rs 29cr in FY20 to Rs 97 cr in FY25, logging in a compound growth of 28% in years.

The EBITDA (earnings before interest, taxes, depreciation, and amortization) went from Rs 1.87 cr to Rs 13.7 cr in the same period, marking a compound growth of an enviable 49%.

The net profits grew at a compounded rate of a huge 151% in the last 5 financial years.

FYFY20FY21FY23FY24FY25
Net Profit (Rs Cr)0.09-2.372.293.588.03

The share price of Sotac Pharmaceuticals Ltd was around Rs 120 when it was listed in April 2020 and as of closing on 19th June 2025 it was Rs 113, which is a small drop. At the current price, the stock is trading at a discount of almost 45% from its all-time high price of Rs 203.

The company’s share is trading at a modest PE of a huge 16x, while the industry median is double at 32x. It will be too soon to look at the 10-year median PE for Sotac Pharma, but the industry median for the same period is 27x.

Silicon Rental Solutions Ltd

Incorporated in 2016, Silicon Rental Solutions Ltd does trading and letting out on hire of Computers, Computer Software and Computer Accessories and other Equipment.

With a market cap of Rs 208 cr, Silicon Rental Solutions Ltdserves a vast clientele of over 250 clients including Tata Motors, Reliance, Mahindra, Grab a Grub, Bewakoof, Epicenter, etc.

The FII holding of Silicon Rental Solutions Ltd grew from 0.54% as of the quarter ending September 2024 to 4.3% as of the quarter ending March 2025.

Nav Capital Vcc – Nav Capital Emerging Star Fund bought a 2% stake and Ovata Equity Strategies Master Fund bought another 1.7% stake.

However, the promoter holding has dropped from 74% to 67% between the same 2 quarters.

As for the financials, the company’s sales have jumped from Rs 12 cr in FY20 to Rs 102 cr in FY25 which is a compound growth of 53% in 5 years.

EBITDA also was on an upwards trend, as it went from Rs 8 cr in FY20 to Rs 45 cr in FY25, logging in a compound growth of 42%.

The net profits were the same in FY24 and FY25 but have grown at a compound rate of 43 between the two years.

FYFY20FY21FY22FY23FY24FY25
Net Profit (Rs Cr)2310111313

Silicon Rental Solutions share price was around Rs 87 when it was listed in October 2022, which has grown to its current price of Rs 182 (As of closing on 19th June 2025), which is a jump of 109

At the current price, the company’s share is trading at a discount of 38% from its all-time high price of Rs 292.

The company is currently trading at a modest PE of 16x, which is lower than the current industry median of 24x. The 10-year median PE for the industry is 22x.

The company intends to increase its presence in Tier 2 & Tier 3 cities. Also, will foray into white goods such as AC along with 3D printers, Robotic equipment, Drones.

Will it Sustain or Subside?

FIIs are not the average joe! When they invest, they have very stringent checks and balances in place to ensure the smart money goes in the most potent opportunities. Of course, nothing is fool proof and there are always exceptions.

These 2 less known or under the radar microcaps we saw today have shown strong resilience and some solid growth in the last few years, which has caught the attention of FIIs and has also cleared their checks, hence the stakes. But now the question is, will the FII interest stay, or will it fade away?

Well only time will be able to tell that, but for now, the smart thing to do is add these stealth mode microcap stocks to the watchlist and keep a very close eye on them.

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Disclaimer:

Note: We have relied on data from www.Screener.in and www.trendlyne.com throughout this article. Only in cases where the data was not available, have we used an alternate, but widely used and accepted source of information. 

The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only. 

Suhel Khan has been a passionate follower of the markets fsor over a decade. During this period, He was an integral part of a leading Equity Research organisation based in Mumbai as the Head of Sales & Marketing. Presently, he is spending most of his time dissecting the investments and strategies of the Super Investors of India.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article. 

The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein.  The content of the articles and the interpretation of data are solely the personal views of the contributors/ writers/authors.  Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.