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Top mid & smallcap stocks which more than doubled investors’ wealth in FY17

The highlight of the year has been the performance of midcaps and small cap indices, which gave stellar returns. The NSE’s midcap index gained a significant 33 percent during the fiscal, while the exchange’s Smallcap index registered a gain of whopping 40 percent.

March 29, 2017 / 12:26 PM IST
 
 
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Equity benchmarks had a good run in this financial year as they posted double-digit gains. Events such as BJP’s victory in the state assembly elections this year, stable quarterly earnings despite demonetisation, strong economic data and good inflows from domestic institutional investors (DIIs) pushed up the indices.

While the Sensex gained 16 percent during the financial year till date, the Nifty registered a gain of 17 percent during the same period.

However, the highlight of the year has been the performance of midcaps and small cap indices, which gave stellar returns. The NSE’s Midcap Index gained a significant 33 percent during the fiscal, while the exchange’s Smallcap Index registered a gain of whopping 40 percent.

Moneycontrol takes a look at top stocks in both the segments, which more than doubled investors’ wealth.

Midcap Stocks

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1. Bajaj Finserv | Price on March 28, 2017: Rs 4,090.75 | Price on March 31, 2016: Rs 1,711.1 | Gain: 139.07 percent

The financial services company has gained over 139 percent on the back of strong quarterly numbers. Earnings momentum had remained strong as the company reported a good set of second quarter numbers where its revenue went up 33.3 percent to Rs 6,912 crore and net profit increased 30.5 percent to Rs 578 crore.

2. Biocon | Price on March 28, 2017: Rs 1,140.25 | Price on March 31, 2016: Rs 483.35 | Gain 135.91 percent

The biopharmaceutical major has seen a huge gain of 135.91 percent on the back of major developments around its litigation as well as a nod by the High Court to sell a cancer drug. Its partner Mylan settled up with Roche and Genentech, which hold patent for cancer drug trastuzumab.

The Delhi High Court also allowed Biocon to make and sell a cancer drug—Canmab. It also gave a similar nod to Mylan for its cancer drug—Hertraz. The court also observed there was no restraint on sale of biosimilar drugs, which have approvals from competent authority.

3. DCB Bank | Price on March 28, 2017: Rs 171.15 | Price on March 31, 2016: Rs 79.25 | Gain: 115.96 percent

The stock has gained a whopping 115 percent in the past financial year. It has witnessed a good set of earnings and was able to smoothly sail through the demonetisation phase. It reported 25 percent surge in December quarter net at Rs 51 crore, driven primarily by a surge in the core interest income.

Its net interest income rose 31 percent to Rs 209 crore, while the non-interest income was up 36 crore to Rs 64 crore during the reporting quarter.

NSE Midcap

Smallcaps:

1. Escorts | Price on March 28, 2017: Rs 523.55| Price on March 31, 2016: Rs 139.25| Gain: 275.98 percent

The stock has given a blockbuster return of 279 percent between March 31, 2016 and March 24, 2017. The gain could have been on the back of better tractor sales and an improvement in the rural sentiment due to better monsoon as well.

The engineering conglomerate is involved in agri-machinery, construction and material handling equipment, railway equipment and auto components.

2. Gujarat Narmada Valley Fertilizers & Chemicals | Price on March 28, 2017: Rs 262.35 | Price on March 31, 2016: Rs 81.6 | Gain: 221.51 percent

The fertilizer and chemical firm has witnessed a gain of 218 percent in the past one year. Investors are likely to have placed bets better rural spending capabilities as well.

Monsoon rains last year was one of the highest in the recent years. This could have boosted consumption by the farmers. Going forward, India Ratings expects fertilizer demand to rise 5 percent YoY in FY18 on higher minimum prices for crops and increased farm income.

3. Delta Corp | Price on March 28, 2017: Rs 176.95 | Price on March 31, 2016: Rs 66| Gain: 168.11 percent

The gaming and hospitality entity gained investors’ interest on the back of rapid expansion in casino operations. Casinos are usually seen as heavy income-generating business propositions. Its one-year gain was seen at 168.64 percent.

The company is awaiting regulatory approval for a casino housed in Daman's only five-star hotel. Given its location advantage, Daman (caters to a catchment area of 35 million people over Mumbai and Gujarat) is likely to attract higher footfalls than Goa, the brokerage house feels. It expects Delta to replicate its success in Goa's offshore casino market in the land-based casino market in Daman.

India's only listed gaming company Delta Corp has a dominant share of India's offshore casino market, with three of the six offshore casino licenses (five operational) in Goa. It has around 1,700 gaming positions in the state across its three offshore casinos, one onshore casino and recently commenced casino in Sikkim.

Given that the Goa government is unlikely to issue new licences and that land-based casinos are allowed only in five-star hotels, Delta's competitive advantage should sustain, it believes.

NSE Smallcap
Uttaresh Venkateshwaran

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