BackSmallcaps in Focus | From Delta Corp to Wockhardt, here are the 10 biggest smallcap laggards of 2023; check full list
Frontline index Nifty 50 hit its fresh record high of 21,675.75 earlier today. The smallcap stocks have outperformed in 2023 with 50 per cent returns, however, some recorded a consistent decline in their stock prices.
PremiumDomestic equity benchmarks Nifty 50 and Sensex are poised to conclude the year with healthy gains despite facing persistent headwinds such as high-interest rates, geopolitical tensions, volatile crude oil prices, and inflationary pressures.
The Indian stock market opened 2023 on a muted note and remained in a downtrend for the first quarter but delivered an upward rally from April onwards. The market is now experiencing a surge of optimism as the frontline indices have remained consistently in positive territory over the past four trading sessions. Both the indices have gained over seven per cent in December so far, following a substantial five per cent gain in the preceding month.
Nifty 50 hit its fresh record high of 21,675.75 and Sensex also hit its new high of 72,119.85 during the session on Wednesday, December 27. With Wednesday's gain, the Sensex and the Nifty 50 have jumped almost eight per cent in December so far.
Frontline index Nifty 50 catapulted to newer heights with year-to-date (YTD) returns of over 19 per cent, while mid and small-caps outperformed with 40 per cent and 50 per cent returns respectively. The smallcap stocks have mostly outperformed this year, however, some recorded a consistent decline in their stock prices.
Among key broader indices, the Nifty Smallcap 250 represents 250 companies (companies ranked 251-500) from Nifty 500. This index intends to measure the performance of small market capitalisation (MCap) companies.
The Nifty Smallcap 250 index represents about eight per cent of the free float MCap of the stocks listed on NSE as on September 29, 2023. The total traded value for the last six months ending September 2023, of all index constituents is approximately 15.5 per cent of the traded value of all stocks on NSE, according to the stock exchange.
In the last one year, the top 10 smallcap losers recorded a double digit decline in their stock prices and fell in the range of 25-40 per cent YTD on the Nifty Smallcap 250. According to Bloomberg data, here are the top 10 smallcap losers of 2023 and the cumulative change in their share price during 2023:
Here are the top 10 smallcap losers of 2023:
1.Dhani Services Ltd: At a current market price (CMP) of ₹39.91, the stock has emerged as the biggest smallcap loser of 2023, logging a sharp 38.16 per cent decrease in its stock price.
2.Polyplex Corp Ltd: At a current CMP of ₹1,067.50, the stock has emerged as the second biggest smallcap loser of 2023, logging a sharp 34.49 per cent decline in its stock price.
3.Brightcom Group Ltd: At a current CMP of ₹19.76, the stock has emerged as the third biggest smallcap loser of 2023, logging a sharp 32.48 per cent decrease in its stock price.
4.Delta Corp Ltd: At a current CMP of ₹147.20, the stock has emerged as the fourth biggest smallcap loser of 2023, recording a 32.40 per cent decrease in its stock price over the year.
5.Wockhardt Ltd: At a current CMP of ₹150.90, the stock has emerged as the fiifth biggest smallcap gainer of 2023, logging a 32.35 per cent decrease in its stock price over the year.
6.Campus Activewear Ltd: At a current CMP of ₹275.25, the stock has emerged as one of biggest smallcap losers of 2023, logging a 32.13 per cent increase in its stock price.
7.TCNS Clothing Co Ltd: At a current CMP of ₹373, the stock has emerged as one of biggest smallcap losers of 2023, recording a decline of 32.03 per cent in its stock price over the year.
8.Thyrocare Technologies Ltd: At a current CMP of ₹655, the stock has emerged as one of biggest smallcap losers of 2023, logging a decrease of 31.91 per cent in its stock price over the year.
9.Aditya Birla Sun Life Asset Management: At a current CMP of ₹316.65, the stock has emerged as one of biggest smallcap losers of 2023, recording a decline of 29.41 per cent in its stock price.
10.Hikal Ltd: At a current CMP of ₹310.40, the stock has emerged as one of biggest smallcap losers of 2023, recording a decline of 28.04 per cent in its stock price.
LiveMint reported earlier this month that the Nifty Smallcap 250 index gained more than 10 per cent in November 2023, outperforming the benchmark Nifty 50 index that surged 6 per cent in a remarkable turnaround.
In addition, both Nifty Smallcap 250 and Nifty Midcap 150 indices have outperformed the other indices when compared on a three-month, six-month, and on an annual basis. In the last three months, Nifty Midcap rose 8.64 per cent and Nifty Smallcap 250 was up 11.07 per cent.
Outlook for 2024
Analysts said that domestic market demonstrated strong resilience throughout the year, surpassing expectations. Towards the end of the year, the stock market saw improvement as selling by foreign investors reduced, accompanied by a decrease in geopolitical risks and inflation.
‘’We expect Nifty50 to provide a return of ~10-12 per cent in CY24. Currently, we are positive on H1CY24 in anticipation of a pre-election rally as the domestic political and global market environment is aptly placed. And the final performance of the second half hinges on the election outcome and the final budget, which is also forecast to be stable,'' said Vinod Nair, Head of Research at Geojit Financial Services.
‘’While challenges are the EL-Nino effect on food inflation and the recent far stretched performance of global markets in anticipation of a deep cut in interest rate, which is a challenge when CPI is forecast to be above the long-term average. We suggest a multi-asset investment strategy, as both equity and non-equity can provide a moderate return as valuations are inexpensive,'' added Nair.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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