 "A man looks at a screen across a road displaying the Sensex on the facade of the Bombay Stock Exchange (BSE) building in Mumbai")
The recent fall in mid-cap stocks has led to a sharp decline in their valuations.
The one-year forward price to earnings (P/E) ratio of the mid-cap index has come down to 15.4, a decline from 27.8 earlier in 2016, shows Bloomberg data. If these estimates are true, the valuations of the benchmark Sensex and the broader Midcap index on the BSE will converge for the first time since 2008.
This moderation in the mid-cap growth comes after the index outperformed benchmarks for two years in a row. During 2016, it rose eight per cent, against a 1.8 per cent gain
