MicroCap stocks shine amid volatility; 1 in every 10 zoom over 10% this Oct

Stocks like IIFL Securities, IFB Industries and Dhani Services soared over 25% so far this month; Experts attribute the outperformance to stock specific news, rather terming it as broader market trend

The month October so far has been volatile for the Indian stock market amid the on-going geo-political crisis in West Asia and the European region. That apart, selective profit-taking following a steady rally in the year so far have also impacted stock prices up to a certain extent.

Despite the market volatility, MicroCap stocks as a segment has outperformed the rest of the equity market thus far in October. An analysis of data from Ace Equity shows that 1 in every 10 Nifty MicroCap 250 stock has soared more than 10 per cent thus far in October.

In comparison, 1 out of 25 Nifty SmallCap 250 index stocks and 1 out of every 50 Nifty MidCap 150 index stocks have gained more than 10 per cent each. Similarly, in the broader market, 1 out of 35 Nifty 500 stocks gained over 10 per cent. Whereas, in case of Nifty 50 index, not a single stock has managed to gain 10 per cent this month.

 

Kranthi Bathini, Director-Equity WealthMills Securities, says this seems more of a stock specific action, and not a broader segment trend. For a broader segment outperformance, more than 50 per cent of the stocks need to log steady gains, he added.

Ace Equity data shows that 1 out of every 5 Nifty MicroCap 250 stocks has gained more than 5 per cent in October so far.  This implies that around 10 per cent of Nifty MicroCap stocks have surged over 10 per cent, while 20 per cent stocks have advanced more than 5 per cent each.

Among individual stocks, IIFL Securities tops the gainers chart with a rally of nearly 29 per cent. IFB Industries, Dhani Services and VA Tech Wabag have surged around 25 per cent each. Ganesh Housing Corporation and Redtape have also soared more than 21 per cent each.

Kranthi Bathini believes that most of these stocks have been driven on news based triggers and expectations of healthy Q2 earnings.

Among others Strides Pharma, Time Technoplast, Paradeep Phosphates, Neuland Labs, Symphony, Sanghvi Movers, Dodla Dairy and Bombay Dyeing were some of the prominent microcap stocks to log over 10 per cent gain.

At the index level, the NSE Nifty 50 index, which had surged up to 15 per cent thus far in 2024, has declined nearly 4 per cent so far in October. Similarly, the Nifty 500 index has shed 3.3 per cent; while the MidCap and SmallCap indices have declined around 1 per cent each so far in October. In the same period, the Nifty MicroCap index has dipped 0.7 per cent.
 

Among the Nifty 50 stocks – Tech Mahindra has been the top mover thus far this month, with a gain of 7 per cent. SBI, HCL Technologies and HDFC Life are the other notable movers. Similarly, BSE, Dixon Technologies and IPCA Labs are the leading gainers among MidCap stocks; while broking stocks – Motilal Oswal and Angel One are among the SmallCap chart busters.