Several small and midcap shares surged on a day of an across-the-board rally, sending Nifty Smallcap 100 up nearly 2 percent and Nifty Midcap 100 higher by over a percent on March 18.
The Nifty Smallcap index extended gains for a second session, after snapping a four-day losing streak on March 17. Narinder Wadhwa, Managing Director & CEO of SKI Capital said the recent correction has brought valuations closer to their historical averages, potentially creating value opportunities for investors.
Shares of Welspun Living were the top gainer on the index, rising nearly 9 percent to trade at Rs 127 apiece. The stock has made significant recovery after hitting a 52-week low of Rs 105 per share in February this year.
Triveni Turbine shares followed, rallying nearly 8 percent to trade at Rs 549 apiece. The rise in the stock's price comes on the back of strong trading volumes. Despite the gains, the stock is still close to its 52-week low of Rs 458.40 apiece, which it had hit in March last year.
Other small-cap stocks which recorded strong gains included 360 One WAM (up nearly 7 percent), Apar Industries (over 6 percent higher) and Aditya Birla Real Estate (up 6 percent).
Among the mid-cap stocks, Paytm was the top gainer. The shares of the fintech firm gained nearly 7 percent to trade at Rs 737 apiece. This comes after the company announced that its subsidiary Paytm Money has received SEBI's approval to provide services as a research analyst. Notably, this is the highest level for the stock so far in March.
Policybazaar-parent PB Fintech followed, with shares rising nearly 5 percent to trade at Rs 1,420 apiece. Other mid-cap stocks which recorded strong gains included NLC India (up nearly 5 percent), Indian Hotels Company (over 4 percent higher) and IREDA (up nearly 4 percent).
The shares of Indian Renewable Energy Development Agency (IREDA) jumped over 4 percent on March 18 after the company increased its borrowing limit by Rs 5,000 crore for the ongoing fiscal, snapping a six-day losing streak.
The mid and smallcap space has been in a strong downturn, eroding nearly a year's gains for half of the BSE Mid and Smallcap Index constituents. Benchmark indices have been in a steep decline since late September, driven by sustained foreign selling. Additionally, US President Donald Trump’s reciprocal tariffs too have further spooked investors.
Morgan Stanley India's Ridham Desai however recently said that the small and mid-caps have now come out of their valuation excesses after a fall of over 20 percent from recent highs. "India is looking much sweeter than it has been in several months now. It was looking stretched for a very long time," he had told CNBC-TV18.
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