Over 50 smallcap stocks drop 10-50% as broader indices log worst week in 15 months; RailTel, RITES among losers
More than 50 smallcap stocks dropped in the range of 10-50 per cent last week with the benchmark Sensex snapping its four-week gaining streak to record its worst week on four months. Public-sector undertakings (PSU) stocks such as RailTel Corporation, RITES, MTNL and Tata Group’s Tata Investments featured among the top losers last week.
Apart from the above, DB Realty, Jubilant Industries, PTC India Financial, Skipper, India Nippon, Swan Energy, NALCO, Engineers India, KPI Green Energy, Spencers Retail, Sigachi Industries, Indo Amines, and others are among the smallcaps that logged a double-digit rise in their share prices last week.
Also Read: Dividend Stocks: Oil India, PFC, TVS Motor Company, among others to trade ex-dividend next week; check full list
Markets’ Weekly Print
The equity indices ended a four-week winning streak after concerns raised by capital markets regulator Securities and Exchange Board of India (SEBI) over valuation in smallcap and midcap stocks. On the weekly front, the 3-share BSE Sensex benchmark tanked 1,475.96 points or 1.99 per cent, while the NSE Nifty declined 470.2 points or 2.09 per cent.
The small- and mid-cap stocks logged their worst week in 15 months on rising concerns of froth in the segments and as stress test results indicated a disparity in the durations that funds would take to liquidate their portfolios. The broader indices dropped 5.5 per cent and 4.66 per cent this week, the biggest weekly drop since December 2022.
Barring information technology, all the major sectors logged weekly losses. Realty, energy and public sector banks were the worst hit, losing between 6.5 per cent and 10 per cent. Bank Nifty settled the week at 46594.10 after falling more than 2.50 per cent.
Foreign institutional investors (FIIs) were buyers for three out of four sessions last week but the net outflow stands at ₹816.91 crore, while domestic institutional investors (DIIs) were buyers for all sessions, with a total investment of ₹14,147.5 crore, according to stock exchange data.
‘’The unfavourable risk-reward balance of mid- and small-cap stocks, fuelled by prolonged premium valuations, has aggravated the downfall. Mid and small caps corrected led by selling from leverage-based retail investors. We expect bargain opportunities to persist in mid- and small-cap stocks whose valuations are supported by fundamentals,” said Vinod Nair, Head of Research, Geojit Financial Services.
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Published: 16 Mar 2024, 09:41 PM IST
Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.