Page 4 - Midcap Space News Today : Breaking News, Live Updates & Top Stories | Vimarsana

Aequitas Investments, a small and mid-cap investor, is still finding companies in the small and midcap sector with inexpensive valuations and continues to invest in them. While there is froth in the small and mid-cap space, there are still pockets with attractive valuations. Aequitas Investment's small-cap strategy has been the top performer in September, driven by long-term calls in sectors such as infrastructure and manufacturing. Thematic funds focused on India's growth story are expected to do well, but it is important to enter at the right stage

Samco Mutual Fund believes that there is still momentum in the small and midcap space despite the pace of inflows slowing down in midcap and smallcap funds. Valuations in the midcap and smallcap space are stretched, but there are still investment opportunities in niche NBFCs, specialty chemicals, auto and auto ancillaries. Thematic funds have gained traction due to geopolitical factors. Key factors to watch in Q2 earnings include IT companies that are not facing weaknesses and improvements in the margins of manufacturing, automobiles, and FMCG sectors.

“We see that the retail investors are reposing faith and trust in the mutual fund industry and they are using the SIP as an investment vehicle to participate in the India story and we believe that going ahead we will see the SIP numbers are going to show an increasing trend.”

“The outperformance of the mid and smallcaps has been substantial versus the Nifty 50 since May. If we are to look at our coverage of 180 to 200 stocks, we have seen our analysts downgrading almost around 16 stocks in the last two months, which is basically we have downgraded around 8% of the stocks to either hold or reduce.”

Jefferies sees an earnings revival in mid-cap firms in financial year 2024 as commodity prices turn favourable and also expects the operating margins of midcaps to rise around 90 bps YoY.