New Delhi, June 29 -- We've all been taught that debt-free companies are fundamentally strong. They generate steady cash flows, pay dividends, or reinvest in the business-all of which contribute to shareholder returns.

And rightly so: a clean balance sheet often signals financial strength. Companies with zero debt enjoy lower interest burdens, greater flexibility, and resilience during downturns. But here's the catch-being debt-free doesn't make a stock risk-free.

Read this | India Inc's cash ammo, lower debt offer cushion. But there's a problem

A company may have no leverage, yet still struggle with low margins, poor execution, policy shocks, governance issues, or rising competition. In some cases, staying debt-free isn't even a choic...