Share of Mid-Caps in India Inc Earnings has seen a fall
Share of Mid-Caps and Small-Caps in the NSE 500 Market Cap is conversely at an all-time high
“The declining share of mid-caps in India Inc earnings and increasing market cap of mid-caps and small caps in the NSE 500 could imply a shift in investor sentiment and risk appetite towards these segments. ..Quantitative analysis supports the notion that the current rally in mid-caps is stretched and due for a pullback. The ratio of mid-cap to largecap and small-cap to large-cap has surpassed the positive 2nd standard deviation, signaling an overextension in the market. This suggests that investors may be overly optimistic about mid-caps, and a correction in their prices is likely in the coming period,” said Hitesh Jain, lead analyst at Yes Securities.
On a positive note, the share of loss-making companies across all market segments is decreasing. This could be an indication of improved overall market health and financial stability. However, sector-wise analysis reveals distinct trends.
First Published: Feb 26 2024 | 11:25 AM IST