Midcaps, smallcaps severely punished in August series

The big stocks who haven’t been able to participate in this 200 point rally have been particularly the banks as well as the metal index. In the past we have seen that these two indices have led the market up. A few stocks that have led the market are Tata Motors , Ranbaxy , Infosys and Reliance . These stocks have done well in this August series. So that is where we are seeing nearly around 5% uptick on the Nifty

However, the midcap index has done absolutely nothing.

So, here are few stocks, that are below their June 4 low (that is when Nifty last breached 4,800 level) and also below their July 26 lows (when Nifty breached 5,050 odd mark). IFCI, infact, is down more than 20% in this series itself and it has done 19% from its June 4 lows. Post the government conversion, there has been equity dilution. Traders are expecting it to correct it to around maybe Rs 17 odd mark.

Another stock that has been in focus is GMR Infrastructure . We have been focusing with regards to the CAG report, with regards to metal stocks. However GMR Infrastructure has absolutely taken a beating and also with regard to further raising of capital via equity were resulted in further equity dilution. GMR Infrastructure has nearly Rs 30,000 crore of debt in their balance sheet.

Opto Circuit is another stock that has taken a big knock. On one particular day, it was down even more than 15% before recovering. Opto Circuits continues to see some kind of pressure and has been under pressure throughout this particular series.

Indiabulls pack has been under tremendous pressure. This is post Veritas report stating that the promoters of the group are accused of sacrificing corporate governance for personal gains. Even after Indiabulls clarifications, both the stocks, Indiabulls Real Estate as well as Indiabulls Financial Services have absolutely taken a beating.

BEML has been stuck with regard to the trucks controversy. In addition to this BEML delivered a net loss in the recently concluded quarter. It saw more pressure after that but however, all is not lost.

However, there are some pockets of strength in the midcap space.

One particularly standout performer has been Tech Mahindra . Tech Mahindra did deliver good set of numbers in the recently concluded quota and have indicated that margins would be sustained going ahead.

Also the big cement companies have led this particular rally. However, if you just look at the pockets of strength, Shree Cement as well as Madras Cement , delivered good numbers and they have indicated that the story looks good with regard to the capacity additions coming onstream. Another stock that has been in focus is Hind Zinc which has done well with regard to its stake sell.

Big losers and gainers in largecap space

Tata Steel is down to Rs 375 levels and a fair amount of investors have been indicating at 0.8 times price to book value, it is very attractive. Jindal Steel is facing some kind of a recovery today but it has had a bad series. In addition to that SAIL , Hindalco , all of them have taken a beating.

The big banks, ICICI Bank has a good weightage in Nifty and it hasn’t participated in this particular rally. The banks that haven’t done well at all have been a PNB as well as Bank of Baroda . So the banking and the metal space are those two sectors which have not participated in this rally else we could have been higher.