February 6, 2024
2 mins read

Small and Mid-Caps Surge, Large-Caps Lag

During the last five years, mid-caps have outperformed largecaps by 86 per cent, while small-caps have outperformed large-caps by 60 per cent..reports Asian Lite News

Over the last 12 months, mid-caps and small-caps have gained 58 per cent and 69 per cent, respectively, while large-caps have risen 23 per cent, as per a research by Motilal Oswal Financial Services.

During the last five years, mid-caps have outperformed largecaps by 86 per cent, while small-caps have outperformed large-caps by 60 per cent.

The Nifty, after recording an impressive 20 per cent YoY gain in CY’23, has begun the year on a cautious note. The month was characterized by extreme volatility, with the benchmark oscillating in a wide range (1,000 points) and pulling back from record highs to close flat MoM, the report said.

In January’24, FIIs posted the highest outflows since February’23 at $ 3.1b. DIIs recorded the six-consecutive month of inflows at $ 3.2b. FII inflows into Indian equities stood at $ 21.4b in CY23 versus outflows of $ 17b in CY22. DII inflows into equities in CY23 remained strong at $ 22.3b versus $ 32.2b in CY22.

Among the sectors, the top gainers were Oil & Gas (+10 per cent), PSU Banks (+10 per cent), Real Estate (+9 per cent), Utilities (+9 per cent), and Infrastructure (+8 per cent). While Media (-10 per cent), Private Banks (-5 per cent), and Consumer (-3 per cent) were the top losers.

The breadth was balanced, with 25 Nifty stocks closing higher. ONGC (+23 per cent), Adani Ports (+18 per cent), Bharti Airtel (+13 per cent), Tata Motors (+13 per cent), and Bajaj Auto (+13 per cent) were the top performers, while HDFC Bank (-14 per cent), LTIMindtree (-13 per cent), Asian Paints (-13 per cent), HDFC Life (-11 per cent), and UPL (-8 per cent) were the key laggards, the report said, the report said.

The Vote-on-Account was presented against the backdrop of a bullish macro and micro environment for India, with equity markets reaching new highs. Further, this was the last budget before the forthcoming Lok Sabha Elections in April-May, and thus, expectations of some populism were not unfounded, considering the underlying weak consumption demand in the economy, especially in rural India.

We anticipate the market to quickly discount the budget and shift focus to the trajectory of corporate earnings growth, which has remained resilient so far in 9MFY24 (albeit, witnessing some challenges with downgrades outweighing upgrades in 3QFY24), the report said.

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