Small stocks give higher returns to investors so far this fiscal year

NEW DELHI: Small stocks have outshined the bigger benchmark gauge by giving returns of up to 22.19 per cent to equity investors so far this fiscal.

In the last financial year too, small stocks gave handsome returns to investors.

The BSE smallcap index has surged 4,582.84 points or 22.19 per cent in the first three months of 2021-22. The midcap index has jumped 2,354.64 points or 11.66 per cent during the same period, according to an analysis of their performance.

In comparision, the 30-share BSE benchmark clocked 2,973.56 points or 6 per cent gain in the first three months of the current financial year. The first quarter of this fiscal ends on Wednesday.

Smallcap and midcap indices have emerged as the favourites amid an overall rally in the broader market.

The midcap index reached its all-time high of 23,045.01 on June 11 while the smallcap index recorded its lifetime peak of 25,299.64 on June 30.

The 30-share BSE Sensex zoomed to its record high of 53,126.73 on June 28.

Gradual pickup in economic activities as states start unlocking, increase in vaccination and better-than-expected Q4 FY21 earnings of companies have supported the market’s uptick, market analysts said..

Last fiscal, the BSE smallcap index zoomed 11,040.41 points or 114.89 per cent, while the midcap jumped 9,611.38 points or 90.93 per cent.

In comparision, the 30-share BSE benchmark clocked 20,040.66 points or 68 per cent gain in the last financial year.

According to the market analysts, smaller stocks are generally bought by local investors while overseas investors focus on bluechips or large firms.

The midcap index tracks companies with a market value that is on an average one-fifth that of large firms whereas it is almost a tenth for the smallcap firms.

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