Screener Conditions (Entry)
Condition 1
Annual Price-to-Earnings (PE) Ratio < 15
Condition 2
Annual Dividend Yield (%) > 3
These two simple but powerful filters help identify high-quality, undervalued, income-generating companies within the Nifty 50.
Logic Behind Choosing These Conditions
This screener is designed to find stable, low-valuation, high-dividend stocks ideal for conservative investors, dividend collectors, and those seeking defensive plays.
Here’s why each condition matters:
1. PE Ratio < 15 (Low Valuation)
A low PE typically signals:
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The company is undervalued compared to its earnings
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Lower downside risk
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Safer entry point
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Room for future PE expansion (value unlocking)
Choosing PE < 15 filters out overpriced or momentum-heavy stocks and focuses on businesses priced reasonably relative to what they earn.
2. Dividend Yield > 3% (Strong Income Stocks)
Companies offering >3% yield generally:
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Share profits consistently with investors
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Have stable cash flows
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Are usually mature, low-risk businesses
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Provide returns even when stock price is sideways
This makes the screener perfect for identifying defensive, income-oriented stocks that perform well in volatile markets.
Backtest Results (Last 50 Daily Candles)
The screener generated four high-quality stocks:
BAJFINANCE, COALINDIA, ONGC, and ITC.
Best Performing Stock: BAJFINANCE
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Steady upward returns across all holding periods
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Strong green performance from 1D to 15D
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Best blend of value + growth + consistency
Weak Performers
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COALINDIA → declining returns across timeframes
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ONGC → moderate slope but slightly improving
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ITC → stable but not strongly trending
Avg. Returns vs Win Rate Chart (Insights)
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BAJFINANCE stands out clearly with the highest average returns on the chart.
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COALINDIA sits in the lower-left region, indicating low returns and low win rate.
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ONGC & ITC cluster near neutral return zone with moderate win ratios.
The cluster map clearly shows BAJFINANCE as the top pick.
Stock Performance Across Holding Periods
BAJFINANCE
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Excellent positive slope from 1D to 15D
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Strong risk–reward and steady growth profile
ITC
- Gradual upward trend → safe, slow compounder
ONGC
- Slight upward slope over longer periods
COALINDIA
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Red slope → declining performance
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Price weakness across all holding durations
This gives a clear signal which stock is most suitable for short-term swing entries.