Define your investment goal and time horizon
Decide your risk tolerance
Prefer businesses with consistent revenue growth
Check profit growth over multiple years
Look for strong return on equity
Prefer low or manageable debt levels
Review operating cash flow and free cash flow
Study the company’s competitive advantage
Check industry growth prospects
Compare valuation with peers
Use key ratios like P/E, P/B, EV/EBITDA, and PEG
Avoid companies with frequent losses
Review promoter holding and promoter pledge
Check corporate governance quality
Read annual reports and quarterly results
Track management commentary and execution history
Prefer companies with clean audit reports
Avoid excessive dependence on one customer or one product
Check dividend history if income matters
Study market share and scalability
Watch for consistent margin performance
Analyze capital allocation decisions
Prefer companies with transparent disclosures
Check liquidity and trading volume
Diversify across sectors and stocks
Avoid buying only on tips or rumors
Use SIP or staggered buying for long-term investing
Reassess holdings periodically
Sell if the business fundamentals deteriorate
Keep emotions out of investment decisions