Smallcaps in Review | From BSE to Angel One, here are the top 10 smallcap gainers of 2023; check full list

Despite persistent headwinds such as high-interest rates, geopolitical tensions, volatile crude oil prices, and persistent inflation, the domestic equity benchmark Nifty 50 is poised to conclude the year with healthy gains. Analysts say that amid record-high markets, investors should eye factors such as global and domestic cues, US Fed interest rates, inflation, general and state elections, upcoming quarterly earnings and Interim Budget 2024 in the next few weeks.

In 2023, the Indian stock market opened on a muted note and remained in a downtrend for the first quarter but delivered a smart rally from April onwards. Frontline index Nifty 50 catapulted to newer heights with year-to-date (YTD) returns of over 18 per cent, while mid and small-caps outperformed with 40 per cent and 50 per cent returns respectively. 

Also Read: Nifty 50 set to clock healthy double-digit gains in 2023; what are the key challenges for the market in 2024?

Among key broader indices, the Nifty Smallcap 250 represents 250 companies (companies ranked 251-500) from Nifty 500. This index intends to measure the performance of small market capitalisation (MCap) companies. 

The Nifty Smallcap 250 index represents about eight per cent of the free float MCap of the stocks listed on NSE as on September 29, 2023. The total traded value for the last six months ending September 2023, of all index constituents is approximately 15.5 per cent of the traded value of all stocks on NSE, according to the stock exchange.

In the last one year, the top 10 smallcap gainers logged a double digit rise in their stock prices and rose in the range of 150-350 per cent YTD on the Nifty Smallcap 250. According to Bloomberg data, here are the top 10 smallcap gainers of 2023 and the cumulative change in their share price during 2023:

Here are the top 10 smallcap gainers of 2023:

1.BSE Ltd: At a current market price (CMP) of ₹2,310, the stock has emerged as the biggest smallcap gainer of 2023, logging a sharp 331.93 per cent increase in its stock price.

2.Cyient Ltd: At a current CMP of ₹2,353, the stock has emerged as the second biggest smallcap gainer of 2023, logging a sharp 200.15 per cent increase in its stock price.

3.Zensar Technologies Ltd: At a current CMP of ₹618.80, the stock has emerged as the third biggest smallcap gainer of 2023, logging a sharp 195.20 per cent increase in its stock price.

4.ITI Ltd: At a current CMP of ₹618.80, the stock has emerged as the fourth biggest smallcap gainer of 2023, recording a 193.92 per cent increase in its stock price over the year.

5.JBM Auto Ltd: At a current CMP of ₹1,442.95, the stock has emerged as the  fiifth biggest smallcap gainer of 2023, logging a 179.14 per cent increase in its stock price over the year.

6.Mazagon Dock Shipbuilders Ltd: At a current CMP of ₹2,290, the stock has emerged as one of biggest smallcap gainer of 2023, logging a 176.38 per cent increase in its stock price.

7.Sonata Software Ltd: At a current CMP of ₹743.90, the stock has emerged as one of biggest smallcap gainer of 2023, recording a growth of 169.81 per cent in its stock price.

8.NLC India Ltd: At a current CMP of ₹252.40, the stock has emerged as one of biggest smallcap gainer of 2023, logging an increase of 169.09 per cent in its stock price over the year.

9.Kalyan Jewellers India Ltd: At a current CMP of ₹342.90, the stock has emerged as one of biggest smallcap gainer of 2023, recording a growth of 164.47 per cent in its stock price.

10.Angel One Ltd: At a current CMP of ₹3,289, the stock has emerged as one of biggest smallcap gainer of 2023, recording a growth of 158.70 per cent in its stock price.

LiveMint reported earlier this month that the Nifty Smallcap 250 index gained more than 10 per cent in November 2023, outperforming the benchmark Nifty 50 index that surged 6 per cent in a remarkable turnaround. 

In addition, both Nifty Smallcap 250 and Nifty Midcap 150 indices have outperformed the other indices when compared on a three-month, six-month, and on an annual basis. In the last three months, Nifty Midcap rose 8.64 per cent and Nifty Smallcap 250 was up 11.07 per cent.

In the last six months, both indices have clocked gains of 26.46 per cent and 33.68 per cent, respectively. Finally, even on a 12-month basis, both indices rose 32 per cent and 37.31 per cent, respectively - clocking the highest gains when compared to other major indices including Nifty 50 and Nifty 500, according to domstic brokerage firm Motilal Oswal.

Also Read: Nifty Smallcap 250 up over 10% in November, outperforms Nifty 50's solid turnaround; check details

Outlook for 2024

Going ahead, the outlook for India's economic growth remains optimistic driven by robust domestic consumption, government spending initiatives, and a gradual rebound in private investment. 

On the domestic front, India became the fifth-largest economy in the world and also the fastest-growing amidst fears of recessionary pressures faced by other developed economies. The Reserve Bank of India (RBI) raised its repo rate to 6.5 per cent in February but has since paused its stance helping create a balance between inflation and growth rates. 

‘’The Israel-Hamas war came as a surprise, but markets continued its uptrend. The recent state assembly elections have been decisive and the market views it to be signaling a third-term for the incumbent Modi Government. We are exiting 2023 on a positive note with RBI upping FY24 GDP guidance by 50bps to 7 per cent and US Fed suggesting at least three rate cuts in 2024,'' said Jaspreet Singh Arora, CIO, Research & Ranking.

‘’The Indian general elections in May and the US Presidential elections in November could make the markets jittery in the runup to those events, but a cool-off in oil prices combined with the strong earnings potential of the Indian companies paints a positive outlook for the market in 2024. Sectors like financials and IT and themes such as manufacturing, PSEs, and healthcare could be rewarding during 2024,'' added Arora.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.