According to data from Ace Equity, several small-cap stocks have delivered exceptional multibagger returns within a short span of 60 days, even amid global market volatility. Sterlite Technologies led with approximately 134% gains, followed by MTAR Technologies at nearly 129%, HFCL over 108%, and Nintec Systems more than 111%. Other notable performers included Sigma Advanced Systems, Mrugesh Trading, and United Foodbrands, which also more than doubled during this period.
As reported by ET Now, the Nifty Smallcap 100 index dropped nearly 10% during the March turmoil, triggered by the Iran conflict, spiking crude oil prices, and foreign institutional investor outflows. Many of these small-cap stocks had already underperformed benchmarks over the prior year, remaining largely stagnant. Valuations compressed sharply during the correction, with earnings multiples approaching one-year lows. The subsequent recovery has been fueled by improving risk appetite, stabilizing crude oil prices, stronger-than-expected quarterly earnings, and renewed selective buying by domestic investors.
According to Aashish P Somaiyaa, CEO of White Oak Capital Management, the rally is attributed to strong fundamentals rather than broad speculation. As reported by ET Markets, Somaiyaa noted that 'The results in small and midcaps have been strong and have surprised investors' and emphasized that it's 'more bottom-up selective stock picking wherever the numbers are looking good'. He highlighted that investors who had stepped back from the segment after prolonged weak returns are now returning selectively, with March numbers for small and mid-cap being better than what people thought.
As reported by JM Financial, while valuations in midcaps and smallcaps have rebounded from March lows, they remain below FY26 averages, indicating selective opportunities in quality companies. Foreign portfolio investors sold a net USD 7.3 billion in Indian equities during April amid geopolitical tensions and a widening trade deficit. Market participants remain wary about the rally's sustainability, with analysts emphasizing that the next phase will hinge on continued earnings delivery, management guidance, and global macro developments rather than mere liquidity-driven momentum.
