Midcap Space News Today

The index rose 0.3% to end at 19,413 - a record close, while the benchmark Nifty gained 0.1% to close at 22,529.05. The volatility index, or India VIX - markets fear gauge, jumped 6.3% to 21.81, suggesting traders see risks in equities in the near term.

Arpit Beriwal says: “On a weekly scale, we have seen a good buying interest from lower levels and on the daily scale, it is holding its gains. So, it is ready to hit a new lifetime high towards Rs 750-760 levels. Within IT pack, our top two bets are from midcap space, Birlasoft and LTTS.”

Valuations in Indian largecaps are reasonable and we expect 15% or more earnings growth in the next couple of years. Sectors and sub-sectors like capital goods, defence, railways capex, electronics and durable manufacturing, construction, renewable power, power transmission & distribution, China-plus-one theme plays, beneficiaries of the production-linked schemes, chemical and pharma companies etc. are mostly represented only in the mid and smallcap space.

“Sensible value will be emerging where you have some disappointments which might come up in the next couple of quarters. Tech is one space where there has been some disappointment but there will still be some challenges as we get along and there already we have seen one leg of valuation correction of 30%-40% especially in the largecap side.”

“Given that the backdrop and inflation is today a bigger issue in the US than in India, that means RBI and the US Fed are both fighting inflation. RBI has done a better job which means India is likely to have an earnings upgrade, with both the midcaps and the largecaps benefiting going into next year.”

“If you trust your money to a mutual fund manager, who brings his expertise in terms of stock picking not only to the diversification across large, mid and smallcaps but also across the sectors, I will find this to be as good a time to invest as any. And finally, because the markets are reaching new highs, it does not mean that markets are overpriced.

“You cannot have a market rally without participation from banking. It is worth paying attention to. But it might not be the outperforming sector. The outperformance may still go back to where it was earlier which is in, say, PSU stocks, for example. Banks have generally been the most beaten down part of the market and Kotak has actually been an underperformer. ”

"The tide has lifted all the boats in this space. Amid Indias buoyant equity markets as well as strong institutional and retail liquidity, several stocks with low public float have also surged this year. We believe caution is warranted in those names with a lower free float amid a lack of liquidity and low institutional ownership. The recent sharp price cuts across this space have showcased the underlying risk involved."

"Its time to be sector-specific if not company-specific. Sectors that are reliant on domestic business will continue to do relatively well compared to companies that are overly reliant on exports. Rather than investing in a high-level mid-, small-, or largecap fund, thematic fund investing would be the ideal approach. As the Indian economy prepares for the catapult, some sectors would outperform for a prolonged period."

"I would be a little cautious in small and midcap space in the near term. Indian SMIDs have returned more than 30% in FY24, significantly outperforming not just their largecap peers, but also their global peers (which have been flat to negative in FY24). This accompanied by increased global volatility, fading margin tailwinds and moderate growth could weigh on overall SMID sentiments."