Here are three small-cap gems that you cannot miss, as recommended by Raja Venkatraman

These agile firms are leveraging opportunities in niche markets and capitalizing on shifting consumer trends to drive growth. Strategic cost optimization, innovation, and sector-specific tailwinds have enabled them to regain momentum despite previous challenges.

While small-cap stocks often carry higher risks due to their scale, the current revival underscores their resilience and potential for high returns. Investors are now closely monitoring these emerging gems, focusing on solid fundamentals and growth strategies that position them for long-term success.

Here are three small-cap stocks to buy:

RHI Magnesita India Ltd

RHI Magnesita is a leading player in the refractory industry, catering to sectors like steel, cement, and glass. The company specializes in manufacturing and trading refractory products, including monolithics, bricks, and ceramic paper. With a strong presence in India and international markets, RHIM has strategically positioned itself as a key supplier for high-temperature industrial processes.

With manufacturing facilities across India and a focus on innovation, RHIM continues to adapt to market demands. Its resilience and strategic initiatives position it as a promising player in the refractory industry.

This counter has undergone a lot of pain in the last 12 months, and the last few weeks have been spent in consolidation that was hinting at a potential recovery. The relative strength index (RSI) that dipped into the oversold levels clearly hinted at the potential rise that could emerge.

With the conditions becoming favourable and the renewed buying interest stepping up once again, we can consider that the trends will thrust above the trendline resistance. The higher timeframe charts show a strong long-body candle that can help the prices move higher.

A break above 380 levels can help the prices rise towards 680 levels within the next three months. Looking ahead , the negative newsflow seems to be giving away and this could be a good time to consider going long.

Jindal Saw

Jindal Saw is a prominent player in the manufacturing and supply of iron and steel pipes, catering to industries like oil, gas, water, and infrastructure. The company has a strong presence in both domestic and international markets, leveraging its advanced technology and diversified product portfolio.

Jindal Saw's strategic focus on high-margin segments and expansion into new markets positions it for sustained growth. With a strong order book and ongoing capital expenditure projects, the company is well-poised to capitalize on emerging opportunities in the infrastructure and energy sectors.

The tide began to change when it acquired a sizeable stake in a power generation company. This acquisition was aimed at procuring electricity at a reasonable rate. This was followed up with consistently strong Q3 numbers that arrested the fall in 2025 at the moving average bands thus creating a very strong base for recovery. The rounding formation seen at the band support prices are a clear evidence of the renewed momentum.

Also, volumes are seen emerging at lower levels, highlighting that the trend could now mushroom into a strong trend. With interest in small caps once again showing some encouraging signs, we can look at buying at current levels for an upside towards 330 within the next 3 months.

Also read | Smallcap survivors: These sectors weathered the market correction

Saregama India

Saregama India, a pioneer in the Indian music and entertainment industry, has a rich legacy and a diversified portfolio. The company operates across music, films, and digital content, making it a key player in the media sector. It is well-known for its extensive music catalogue, including over 1.42 lakh songs in multiple languages, which are monetized through streaming platforms, YouTube, and its iconic Carvaan music player.

Saregama's strategic focus on digital monetization and content creation positions it for sustained growth. Its Carvaan product continues to perform well, and the company is expanding into films and web series through Yoodlee Films. With a strong balance sheet and innovative approach, Saregama remains a promising player in India's evolving entertainment landscape.

This stock moved quite well in 2024, and the profit booking brought prices lower to test the MA Bands, similar to the start of 2024. Over the last few weeks, we are noting that value region around 440 levels are clearly indicating that the recovery from the MA Bands on higher timeframe could sustain the selling pressure and attract some buying interest.

Additional indications from RSI hint at the neutral zone with an eye on the future. Hence, the moves that unfold can take the prices towards a resistance zone of around 625 within the next three months.

Also Read: FIIs are betting on these small-cap stocks—should you?

Conclusion

Small-cap stocks offer us more potential for growth, and hence, it's always an attractive proposition for the retail segment. The last few weeks have been quite challenging and the sharp drawdown in majority of the stocks are seen receding.

With the markets now showing signs of recovery, one can look to participate in small portions in names that are making some strides to rebound.

Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.