Fear is currently the loudest voice in the market. As geopolitical friction in the Middle East continues to destabilize global energy prices, the Nifty has retreated nearly 7.5% this month, prompting a broad flight to the perceived safety of cash. For the average investor, the instinct is to avoid the carnage in the small-cap segment, yet it is precisely within this volatility that a curious mathematical anomaly takes shape many times.
Beneath this surface of the general panic, two small cap companies are catching the eye of the smart investors. Both have managed to grow their net profits for three consecutive quarters, signalling an operational resilience that the market has yet to price in. Plus, they are clocking a dividend yield of 6% in a flat market.
However, their prices have corrected and are trading near 52-week lows, giving birth to a lot of questions. Will these virtually debt-free outliers represent a genuine margin of safety or merely the first victims of a deeper liquidity squeeze. Let us dive in to see if the stocks have it in them to come out shining at the other end.
D B Corp Ltd – The Print Giant’s Digital Pivot
Incorporated in 2005, D.B. Corp Ltd is engaged in the business of publishing newspapers, radio broadcasting, providing integrated internet and mobile interactive services and event management.
With a market cap of Rs 3,593 cr, the company is India’s largest print media company publishing 5 newspapers, namely, Dainik Bhaskar (43 editions), Divya Bhaskar (8 editions), Divya Marathi (6 editions), Saurashtra Samachar and DB Star in 3 languages, i.e., Hindi, Gujarati, and Marathi. Under this division, the company also publishes monthly magazines such as ‘Aha Zindagi’, ‘Bal Bhaskar’, etc
Along with that, the company is also into FM Radio segment, with its channel 94.3 MyFM which is available in 7 states and 30 cities, creating a valuable package for advertisers in tier II and III cities.
Plus, the company has a strong online presence with 4 internet portals and 4 mobile applications. It holds about 67% of the Indian language media space. D B Corp is the No.1 digital player in Hindi and Gujarati languages as well.
The 6% Margin of Safety
D B Corp Ltd has a current Dividend Yield of 6% while the industry media is about 0.3%. Which means for every Rs 100 invested in the stock, the company pays the investor a dividend of Rs 6 per year, while its peers manage only 30 paise.
The company also has a current ROCE (Return on Capital Employed) of an impressive 21%, while the industry median is 6%. In simple words, this means that for every Rs 100 the company uses as capital, it generates a profit of Rs 21, while industry peers average around Rs 6.
The current debt-to-equity ratio of the company is 0.13, meaning it is virtually debt free and hence safe from heavy interest payments.
In the last 4 quarters, the company has logged a growth in net profits every quarter.
| Quarter | Mar’25 | Jun’25 | Sep’25 | Dec’25 |
| Net Profits/Rs Cr | 52 | 81 | 93 | 96 |
The Struggle of Pivoting to Digital
But let us also look at the long-term financials to see if the company has what it would take to sustain this trend.
The company’s sales have recorded a dismal compound growth of just 1% from Rs 2,224 cr in FY20 to Rs 2,339 cr in FY25. And between April and December 2025, the company has logged sales of Rs 1,778 cr.
EBITDA (Earnings before Interest, Taxes, Depreciation, and Amortization,) logged a bumpy ride in the last 5 years.
| Year | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
| EBITDA/Cr | 84 | 307 | 305 | 324 | 623 | 546 |
For the three quarters of FY26 ending December 2025, the company has recorded EBITDA of Rs 384 cr.
Regarding the net profits, the company saw an upward trend until March 2024, before it fell in March 2025.
| Year | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
| Net Profits/Cr | 275 | 141 | 143 | 169 | 426 | 371 |
And for the 3 quarters of FY26 ending December 2025, the company has logged net profits of Rs 270 cr.
The share price of D B Corp Ltd was around Rs 92 in March 2021 and as of closing on 26th March 2026 it was Rs 202.
However, the stock has seen a steep correction of 25% in the last 6 months as it fell from around Rs 270 to its current price of Rs 202, which is closer to its 52-week low of Rs 195. This decline marks a shift from a growth story to a high-yield value play. After the 2024 election boom, ad revenues cooled and net profits dropped. Rising newsprint costs and a weak rupee are now squeezing margins. Which makes the company mature business struggling to fund its digital transition.
As for valuations, the stock is trading at a PE of 11x, while the industry median is 9x. The 10-year median PE of D B Corp is 13x and the industry median for the same period is 11x.
D B Corp now sits in a state of delicate balance. Its high ROCE and low debt provide a clear margin of safety, but stagnant sales growth reveals a maturing legacy core. The recent price correction shows a market weighing the steady 6% yield against the execution risks of a digital pivot. However, the final verdict rests on whether this print giant can successfully convert its massive linguistic reach into a profitable digital future.
Quess Corp Ltd – A Three-Way Split in Search of a Bottom
Established in 2007, Quess Corp Limited is one of India’s leading business services provider, leveraging its extensive domain knowledge and future-ready digital platforms to drive client productivity through outsourced solutions.
With a market cap of Rs 2,638 cr, the company is a leading staffing player in India and amongst the top 5 Staffing companies globally by headcount, serving 3,000+ clients.
One of India’s Warren Buffetts, ace investor Ashish Dhawan holds a 4% stake in the company along with an 8% holding by Tata Small Cap Mutual Fund. Backing by smart money is a green flag in the books of smart investors.
Just like D B Corp above, Quess Corp has also logged a steady growth in the last few quarters in terms of profits. In fact, Quess Corp’s is a case of a turnaround from losses.
| Quarter | Mar’25 | Jun’25 | Sep’25 | Dec’25 |
| Net Profits/Rs Cr | -95 | 51 | 52 | 55 |
Fighting The Demerger Demons
Looking at the long-term financials, the company’s sales have recorded a compound growth of 6% from Rs 10,991 cr in FY20 to Rs 14,967 cr in FY25. And for the 3 quarters of FY26 ending in December 2025, the sales logged were Rs 11,413 cr.
EBITDA is an area of concern for the company as it saw a big drop in FY25.
| Year | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
| EBITDA/Cr | 50 | 449 | 624 | 589 | 700 | 263 |
And for the first 3 quarters of FY26, EBITDA of Rs 227 cr has been logged.
The net profits also logged a worrisome figure like the EBITDA
| Year | FY20 | FY21 | FY22 | FY23 | FY24 | FY25 |
| Net Profits/Cr | -432 | 74 | 251 | 223 | 280 | 46 |
And for the 3 quarters of FY26 ending in December 2025, profits of Rs 158 cr have been logged by the company, which means the company is headed to a strong finish to the financial year.
The share price of Quess Corp Ltd was around Rs 337 in March 2021 and as of closing on 26th March 2026 it was Rs 177.
The Complexity Discount: Navigating the Demerger Surgery
Just in the last 6 months, the stock price has corrected by 32% from around Rs 260 to Rs 177, which is closer to the stocks 52-week low of Rs 168. This decline reflects a complexity discount as revenue stagnation and a three-way demerger triggered institutional de-risking.
In April 2025, the company split into 3 separate entities by means of a demerger. Quess Corp Ltd for Workforce Management, Digitide Solutions Ltd for BPM, Insurtech, and HRO, and Bluspring Enterprises Ltd for Facility Management, Industrial Services, and Investments.
This correction in price suggests that the market is prioritizing top-line clarity over the theoretical long-term value of the split entities.
Regarding valuation, the company’s share is trading at a current PE of 12x, while the current industry median of 9x. The 10-Year median PE for the company is 20x and the industry median for the same period is 24x.
Quess Corp is currently nursing a demerger headache. While a 6% yield and a modest valuation look like a bargain, the market is playing wait-and-see to discover if these three spin-offs can actually thrive on their own. It’s a classic tug-of-war: does this split unlock hidden value or just expose the baggage of a maturing giant? The floor looks solid, but the stock won’t truly run until these new units prove they can deliver the goods.
Coiled Springs or Falling Knives?
The market is currently wrestling with a classic dilemma: whether to trust the steady safety of a dividend check or fear the falling knife of a share price. For both D.B. Corp and Quess Corp, the 6% yield offers a buffer rarely seen in the small-cap space, yet their fall to 52-week lows suggests that investors are demanding a high price for uncertainty.
The core tension lies in whether these firms are falling stars or coiled springs. D.B. Corp remains a cash-generating machine with an enviable 21% return on capital, but it is a giant trying to learn a new language as it pivots from newsprint to digital screens. Meanwhile, Quess Corp is navigating the internal surgery of a three-way demerger, a move designed to unlock value but one that often leaves the market squinting to see the final picture.
Ultimately, the FY27 outlook for these two outliers depends on execution rather than just valuation. For the value seeker, a 6% yield provides a significant margin of safety, especially when compared to a flat industry median. Add these stocks to a watchlist and keep an eye on them to ensure you don’t miss out on any big movements.
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 for 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.
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