Published on Fri, Jan 05, 2007 at 12:17 | Source : Moneycontrol.com
Updated at Fri, Jan 05, 2007 at 13:02
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Midcaps to become 2007 poster boy
One strong trend that has emerged in the New Year is the high expectation from the midcap space. Some experts have even referred to 2007 as the year of the midcaps. So why is there so much excitement stemming from a lesser performing space in the market? Experts reveal.
From the midcap space, Ramesh Damani, Member of BSE, is bullish about midcap IT stocks.
Sajiv Dhawan of JV Capital Services says that midcap IT is the space to watch out for. He is of the opinion that some of the speculative money would go into the midcap tech stocks, but he would be looking to take profits in some of the midcap tech stocks after the recent run ups.
Gautam Shah of JM Morgan Stanley believes that the midcap sector will gain as much as 10-12% in January itself. "In the last leg of any uptrend, it's typically the midcaps and smallcpas, which outperform by a wide margin. I think almost on a weekly basis you will see more and more stocks participating in the rally."
Meanwhile, Amit Dalal of Amit Nalin Securities avers that people will direct their capital towards midcaps. "Midcaps will perhaps outperform the returns from here on because nobody expects this market to give you, on a Sensex level, more than 10% in this quarter and that in itself is saying 15,500, which is not a small number. Therefore the midcaps will definitely give us higher returns in the quarter coming forward."
Anand Tandon Gryffon Investments says that the midcap and smallcap stocks would do a lot better that the largecap stocks, provided the market trend remains neutral to positive. "However, if the trend turns negative, then the volatility in the smaller companies is obviously higher."
The Street has turned exceedingly positive on the midcap space in the New Year, and specifically sectors like IT, pharma, consumer durables and FMCG. But whether this space will live up to the expectations, only time will tell.
