Beyond index highs and smallcap carnage, India's top performing stocks have risen 30-100% this year

The S&P BSE Sensex touched a record high of 36,443.98 on 29 January and then it witnessed some bit of selling pressure but bulls managed to take control and pushed the index to a record high of 36,928.06 as on July 25.

The index might have gained nearly 500 points, or a little over 1 percent from January 29 to July 24, but 20 stocks in the S&P BSE 500 index and the Smallcap index rose 30-100% during the same period, data compiled from AceEquity showed.

Nelco from the smallcap index rose 106 percent and from the S&P BSE 500 index Indiabulls Ventures gained 96 percent, followed by Firstsource Solutions rallied 68 percent, and Bajaj Finance was up 60 percent in the same period.

Other stocks which rose 30-40 percent include names like Nestle India, HEG, KPIT Technologies, Zydus Wellness, Abbott India, Ipca Laboratories, Hexaware Technologies, L&T Infotech, Zensar Technologies, Page Industries, and Avenue Supermarts.

If we look at the data from January when the index hit the first record high, the share of stocks gaining positive momentum is still lower than the losers which highlight negative breadth for the index.

As many as 101 stocks in the S&P BSE 500 index gave positive return while the rest slipped up to 90 percent in the same period which includes names like Vakrangee, Kwality, PC Jeweller, HCC, Reliance Naval, 8K Miles, Jet Airways, PTC India, Punjab National Bank, and Suzlon Energy.

Mid & smallcaps have come under pressure due to regulatory headwinds as well as high valuations in 2018. Analysts are advising investors to move away from small & midcap space and buy into largecaps. However, some mid & smallcaps might look attractive after a recent slide.

Over 80 percent of the stocks in the S&P BSE Smallcap index gave negative returns from January 29 to July 24 which include names like Gitanjali Gems, KSK Energy, Kwality, JBF Industries, Omkar Speciality, Diamond Power, SRS Real, Sunil Hitech etc. among others.

“We have been suggesting our retail investors to shift their equity exposure from mid & small caps to large caps which we are still continuing. But some of the prices in midcaps have become attractive which can be considered for the long-term,” Vinod Nair, Head of research at Geojit Financial Services told Moneycontrol.

“However, we are still within the long-term bull rally which is under a phase of consolidation. This phase of consolidation can continue till the domestic earnings growth return & politics fear settle, global bond yield normalise & risk-off trend reverse,” he said.