Smallcap stocks under pressure; Sterlite, MTAR, HFCL, Netweb slide 5%

At 10:04 AM on Thursday, the Nifty Smallcap 100 index was down 0.86% at 19,218, as compared to a 1% rally in the Nifty 50.

Smallcap stocks were under pressure with the Nifty Smallcap 100 index falling 1 per cent in Thursday’s intraday deals amid an otherwise strong market. The index was down amid a sharp decline in market prices of IDBI Bank, HFCL, MTAR Technologies, Netweb Technologies, Mangalore Refinery and Petrochemicals (MRPL) and Chennai Petroleum Corporation (CPCL).

 

At 10:04 AM, the Nifty Smallcap 100 was down 0.86 per cent at 19,218, as compared to 1 per cent rally in the Nifty 50. 

 

Nifty Smallcap 100 index has corrected 5 per cent from its 52-week high of 20,187.80 touched on September 4, 2026. However, thus far in the calendar year 2026 (CY26), the Smallcap 100 index outperformed the market, surging 8.5 per cent, against a 12.5 per cent fall in the benchmark index.

 

 

The market prices of AI- and data-centre related stocks traded lower after US markets ended lower on Wednesday, as rising inflation concerns weighed on technology stocks, particularly AI-related shares. The Nasdaq Composite declined 511.52 points or 1.88 per cent to 26, 692.87.

 

Share prices of HFCL (₹243.82), Sterlite Technologies (STL) (₹878.45) and MTAR Technologies (₹7,288.50) were locked at the 5 per cent lower circuits with only sellers at these counters.

 

STL is a global leader in advanced connectivity solutions, providing end-to-end solutions for building AI-ready infrastructure, FTTx, Rural and Enterprise networks. The stock hit a record high of ₹1,051.10 on October 6, 2026. Thus far in CY26, STL’s market price zoomed 757 per cent.

 

Share price of HFCL zoomed 254 per cent so far in CY26. The stock hit an all-time high of ₹275.91 on October 7, 2026.

 

HFCL is a leading technology enterprise with operations in high-end Optical Fiber and Optical Fiber Cables, Optical Connectivity Solutions, Telecom and Defence Equipment. The company is also creating digital networks for Telcos, Enterprises and Defence Forces.

 

Meanwhile, the share price of Emmvee Photovoltaic Power slipped 8 per cent to ₹276 on the NSE in intraday deals. The company is an Indian manufacturer of solar photovoltaic modules and TOPCon solar cells. The stock has corrected 26 per cent from its recent peak. However, thus far in CY26, it outperformed the market by surging 50 per cent.

 

Analysts at Jefferies see Emmvee among the handful of players to backward-integrate into ingots/wafers by FY29 and enjoy industry-leading profitability during the domestic wafer shortage. The brokerage firm projects a 33 per cent earnings before interest, tax, depreciation and amortisation (Ebitda) compound annual growth rate (CAGR) over FY26-29E. Analysts reiterate a Buy rating on the stock with a price target of ₹430.

 

Further, the share price of IDBI Bank plunged 8 per cent to ₹83.60 in intraday deals. ALSO READ | IDBI Bank tanks 6% after deal with Fairfax finalised; what's ailing stock?

 

 As per an exchange filing, the Union Cabinet approved the sale of a 60.72 per cent controlling stake in IDBI Bank to Fairfax Financial Holdings for ₹52,878 crore at ₹81/share, above the government’s benchmark valuation of ₹75.9/share. Post-transaction, the Centre and Life Insurance Corporation of India (LIC) will retain a combined 34 per cent stake, while Fairfax will gain management control, subject to regulatory approvals and completion of the open offer process. 

 

According to reports, Fairfax’s investment will be locked in for three years, while IDBI Bank will retain its existing brand name. Fairfax will also be required to make an open offer to minority shareholders, with the Reserve Bank of India (RBI) assessing its fit-and-proper credentials and the roadmap for compliance with ownership norms.

 

Fairfax’s entry removes a longstanding ownership overhang for IDBI Bank and should bring greater clarity on capital allocation, technology, management strategy and growth following the bank’s asset-quality clean-up. The transaction should also help the government surpass its FY27 ₹80,000 crore disinvestment/asset monetisation target. At the deal price, IDBI is valued at around ₹87,085 crore (~1.3x P/B), and the shift to private ownership could support a gradual re-rating toward private-bank valuations, subject to improvement in growth and return ratios, ICICI Securities said in a note.

 

A potential merger with CSB Bank could add southern-market strength and a more granular franchise, though value creation will depend on the swap ratio, integration and minority shareholder treatment; a Fairfax stake sale in CSB remains an alternative, the brokerage firm said. Disclaimer: Views and outlook in this report belong to the brokerages and analysts cited. They do not reflect the views of Business Standard. Readers are advised to exercise discretion.