Suzlon, Rolta zoom 50% since February. Is the tide turning for small-caps?

The S&P BSE Small-cap index has recovered over 11 per cent till Wednesday, after hitting a 52-week low of 13,099.46 in the intra-day trade on February 18. 

During this period, five stocks from the index have soared over 50 per cent. Suzlon Energy tops the list with a 115 per cent gain, followed by Punj Lloyd (up 58.45 per cent), Rolta India (up 57.37 per cent), GVK Power (up 53.38 per cent) and Tejas Networks (up 53.12 per cent). 

Other stocks which have gained significantly include Shivam Autotech, BF Investment, Religare Enterprises, Uttam Sugar Mills and Jaypee Infratech - all rallying between 45 and 49 per cent. 

Of late, a lot of analysts have turned positive on the broader market after both the indices -- S&P BSE Small-cap and S&P BSE Midcap-- bled heavily during the last year. 

“From a valuation perspective, large-caps are highly valued. There is an opportunity in the high-quality small- and mid-cap segments. I don’t know how long it will continue, but we have seen optimism emerge towards this segment,” said B Gopkumar, CEO (broking and distribution business) of Reliance Capital.

Viraj Mehta, managing director and fund manager at Equirus PMS, agrees and sees value in small and mid-cap stocks. READ FULL INTERVIEW HERE

Analysts at B&K Securities in a recent report said that the major part of the underperformance in smallcaps is over and it is time to increase the allocation to this segment. "Valuations have become very attractive after the recent correction. Besides, macro data also paints a bullish picture, which augurs well for these stocks," their report said.

Heidelberg Cement, Inox Leisure, KEI Industries, Subros, Suven Life Sciences and VRL Logistics Westlife Development are their top picks from the index. 

Company Name	Closing price as on March 5, 2019	Closing price as on Feb 18, 2019	% change
Suzlon Energy Ltd.	7.44	3.46	115.03
Punj Lloyd Ltd.	2.25	1.42	58.45
Rolta India Ltd.	7.79	4.95	57.37
GVK Power & Infrastructure Ltd.	8.16	5.32	53.38
Tejas Networks Ltd.	183.05	119.55	53.12
Shivam Autotech Ltd.	39.40	26.30	49.81
BF Investment Ltd.	255.85	170.80	49.80
Religare Enterprises Ltd.	29.95	20.00	49.75
Uttam Sugar Mills Ltd.	151.30	101.15	49.58
Jaypee Infratech Ltd.	3.81	2.61	45.98
Ashapura Intimates Fashion Ltd.	16.31	11.20	45.63
Transformers & Rectifiers (India) Ltd.	14.85	10.22	45.30
Udaipur Cement Works Ltd.	16.10	11.38	41.48
SML Isuzu Ltd.	736.60	525.10	40.28
J Kumar Infraproject Ltd.	159.80	114.45	39.62
Panama Petrochem Ltd.	126.90	91.50	38.69
Kridhan Infra Ltd.	43.10	31.30	37.70
NCL Industries Ltd.	142.40	103.50	37.58
A2Z Infra Engineering Ltd.	18.50	13.45	37.55
Jindal Stainless Ltd.	41.35	30.10	37.38
Ashapura Minechem Ltd.	27.15	19.80	37.12
Dwarikesh Sugar Industries Ltd.	31.45	23.10	36.15
Jaiprakash Associates Ltd.	6.76	4.99	35.47
Sadbhav Engineering Ltd.	223.65	165.15	35.42
Indiabulls Integrated Services Ltd.	300.95	222.40	35.32
Repco Home Finance Ltd.	427.75	316.70	35.06
IRB Infrastructure Developers Ltd.	151.05	111.85	35.05
Magma Fincorp Ltd.	114.45	85.30	34.17
Intellect Design Arena Ltd.	202.95	151.90	33.61
SORIL Infra Resources Ltd.	300.35	224.95	33.52
Prime Focus Ltd.	68.00	50.95	33.46
HG Infra Engineering Ltd.	233.50	175.55	33.01
Adhunik Industries Ltd.	53.05	39.90	32.96
Welspun Corp Ltd.	120.05	90.30	32.95
Neuland Laboratories Ltd.	766.15	576.50	32.90
Jaiprakash Power Ventures Ltd.	2.07	1.56	32.69
Star Paper Mills Ltd.	130.60	98.50	32.59
3I Infotech Ltd.	3.72	2.81	32.38
Thirumalai Chemicals Ltd.	89.80	68.00	32.06
Take Solutions Ltd.	134.75	102.05	32.04
Satin Creditcare Network Ltd.	292.10	221.30	31.99
Bhansali Engineering Polymers Ltd.	79.50	60.25	31.95
TPL Plastech Ltd.	149.20	113.50	31.45
Prism Johnson Ltd.	89.05	67.80	31.34
CG Power & Industrial Solutions Ltd.	38.05	29.00	31.21
Avadh Sugar & Energy Ltd.	488.95	373.00	31.09
Royal Orchid Hotels Ltd.	120.45	92.10	30.78

Source: ACE Equity