IGI Logo

Below are Quote on Small Cap Index hitting new highs by Mr. Yash Gupta Equity Research Associate, Angel Broking Ltd  

S&P BSE SmallCap at all time high, is it a good time to buy?

S&P BSE small cap index hits the highs of ₹23,093 up by 120% in the last 1 year and almost 200% from the lows of April 2020. Small caps stocks heavily impacted during the covid sell off in April 2020, from their large caps are the first one who has started showing the strength and then Nifty hits the all time high and crosses the ₹15,400 mark but the midcaps & small caps have not participated in the initial bull run. Now in the last 2-3 months we have seen a bull run in madcap as well as small caps stock. The main reason for the bull run in small cap is that the premium gap between large cap and small cap hit the lowest in the month of February 2021. In small cap many stocks are trading at higher side of their last 10-year valuations but some of the stocks are trading at attractive valuation like LT foods. We suggest retail investors to be cautious on small cap stock as we expect it time to be stock specific rather than index oriented.

We have a buy call on LT food with target price of ₹125.

Above views are of the author and not of the website kindly read disclaimer