BSE Smallcap index hits over 8-month low; 201 stocks fall to 52-week lows

Thus far in the month of January 2026, the Smallcap index has underperformed the market by falling 6.3 per cent, as compared to 2.8 per cent decline in the BSE Sensex.

The BSE Smallcap index hit an over eight-month low of 47,627.96, falling 3 per cent in Tuesday’s intraday trade amid selling pressure due to ongoing tariff-related concerns and rising geopolitical tensions. 

The index closed 2.7 per cent lower at 47,719.07. 

The BSE Smallcap index now quotes at its lowest level since May 9, 2025. It had hit a 52-week low of 41,013.68 on April 7, 2025. Thus far, in the month of January 2026, the smallcap index has underperformed the market by falling 7.6 per cent, as compared to 3.6 per cent decline in the BSE Sensex and 4.5 per cent fall in the BSE Midcap index. There has been a massive wealth erosion from the smallcaps from their peak valuations in September 2024, said G Chokkalingam, founder and head of research at Equinomics.  ALSO READ | Lodha, Godrej Properties, Brigade at 52-week lows; why realty stocks fell? 

A vast majority of quality smallcap stocks, he suggests, trade at attractive valuations now. “We expect the SMC (small & mid-cap) segment, especially smallcaps with strong fundamentals to see a significant recovery from mid-March 2026. The SMID segment can outperform the Sensex and Nifty in the calendar year (CY26). We believe that till March 2026 end, it would be the ideal time to accumulate quality small cap stocks for wealth creation in the next 1 to 2 years,” Chokkalingam said. 

52-week lows 

As many as 266 stocks from the BSE Smallcap index hit their respective 52-week lows in intra-day deals on Tuesday. AAVAS Financiers, Bata India, Godrej Properties, Gokaldas Exports, Just Dial, MTNL, Ashoka Buildcon, Indian Energy Exchange (IEX), PCBL, Raymond, Praj Industries, SpiceJet and Tata Chemicals were among notable stocks from the index to touch 52-week lows. “An area of concern is that the early December 2025 quarter (Q3FY26) results do not indicate a recovery in earnings growth. This is likely to change when the results of auto companies start flowing in since this sector has done well in Q3FY26 and it is heartening that the growth momentum is continuing in the sector,” said V K Vijayakumar, chief investment strategist at Geojit Investments in a recent note.  ALSO READ | Nifty PSU Bank index hits new high, rallies 21% since October on FPI buying 

However, the good news, he believes, is that the IMF has raised India’s FY26 GDP growth rate to 7.3 per cent confirming the robust performance of the economy despite many headwinds. 

The analyst believes that geopolitical and geo-economic issues will continue to dominate in the near-term and will influence the direction of the market. Investors, he recommends, can watch the developments and continue to follow a policy of nibbling at high quality stocks on declines.