Latest news with #SMID
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Business Standard
11 hours ago
- Business
- Business Standard
Emkay bets Rs 1,000 cr on small and mid-caps with New Growth Engine Fund
Emkay Investment Managers on Wednesday launched the Emkay SMID Cap Growth Engine Fund, a portfolio that underscores growing investor appetite for India's small and mid-cap space, aiming to capture the next phase of India's economic expansion. Targeting a corpus of Rs 500–Rs 1,000 crore, the fund is being offered in both AIF and PMS formats, and is designed for investors seeking high-conviction exposure to small and mid-cap companies expected to drive the country's future growth story. So, what's the pitch? Why SMIDs now? EIML's new fund is based on a simple idea: India's growth story is no longer just about the giants. Smaller and mid-sized companies — especially those driven by innovation, digital expansion, capex, and consumption — are becoming the real engines of future wealth creation. And here's the kicker: SMID stocks have already delivered strong returns over the past 5 years, but EIML believes that the next 3-5 years could be even better, thanks to: Easing inflation Falling interest rates (which helps smaller businesses that rely on borrowing) Improving household incomes Supportive liquidity conditions Strong backing from FIIs and domestic mutual funds What makes this fund different? Name: Emkay SMID Cap Growth Engine Fund Structure: Available both as AIF (Alternative Investment Fund) and PMS (Portfolio Management Services) Target Corpus: ₹500–₹1,000 crore Strategy: Invests in listed small and mid-cap stocks using bottom-up stock picking Research Framework: The unique E-Qual Framework that scores companies on business strength and management quality Benchmark: S&P BSE 500 TRI Recommended Horizon: 2–3 years Fund Managers: Market veterans Manish Sonthalia and Kashyap Javeri Investment Objective: The product seeks to achieve long-term capital appreciation by investing primarily in small cap & mid cap securities. Description of types of Securities: Under this PMS and AIF product investments are made in equities and equity related instruments. A balanced and well-diversified equity portfolio is created based on fundamental research. Investment Approach: The strategy follows a bottom-up stock picking process "Small & Mid Cap (SMID) offers broader exposure to India's growth story through innovation, digitalisation, capex, and consumption, providing more opportunities for alpha generation compared to large caps. These sectors are likely to benefit from macro tailwinds such as easing inflation, declining interest rates, rising household income boosting consumption, and liquidity measures supporting market revival translating into higher growth. Given that SMID companies tend to rely more on borrowing for their operations and growth, their higher sensitivity to interest rate cycles positions them to revive and potentially outperform in an environment of easing retail inflation and declining rates," said the company in a statement. According to EIML, mid and small-cap companies are anticipated for positive growth over next 3-5 years, making them a good potential bet for investing. EIML also highlights that mid and small-cap stocks have delivered a robust return over the past five years. It further notes that the current macroeconomic conditions and supportive valuations present an attractive entry point for SMID investments, particularly following the recent market correction. Who is this fund ideal for? If you're an investor who: Is looking for higher alpha than large-cap funds Can tolerate moderate to high volatility Has a 2–3 year investment horizon Wants to diversify beyond blue-chip stocks Believes in India's structural growth potential — then this fund might be a smart addition to your portfolio. "As of March 2025, small-cap and mid-cap mutual funds (MFs) together constitute over 30% of total equity flows, a significant jump from 5% a year ago. The dual support from foreign institutional investors (FIIs) and mutual funds makes this rally much more sustainable. Strengthening flows into SMID segments suggest that select opportunities in small and mid-cap stocks could outperform over the medium term," said Manish Sonthalia, Director &; Chief Investment Officer, Emkay Investment Managers Limited. I
Time of India
a day ago
- Business
- Time of India
Emkay Investment Managers launches SMID Cap Growth Engine Fund
Emkay Investment Managers Limited (EIML) has announced the launch of the Emkay SMID Cap Growth Engine Fund . EIML aims to raise Rs 500 crore to Rs 1,000 crore from this latest fund during FY26. The product seeks to achieve long-term capital appreciation by investing primarily in small-cap and mid-cap securities. Under this PMS and AIF offering, investments are made in equities and equity-related instruments , with a balanced and well-diversified portfolio constructed based on fundamental research. Also Read | How a Rs 50,000 Monthly SIP for 20 years can grow to Rs 5 crore, explains Vijay Kedia Best MF to invest Looking for the best mutual funds to invest? Here are our recommendations. View Details » by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Neuvěřitelné: Kalkulačka okamžitě ukáže hodnotu vašeho domu [podívejte se na to]! tržní hodnota mého domu Kliknout zde Undo The strategy follows a bottom-up stock-picking approach, supported by extensive fundamental analysis, including an in-depth study of the business, management, and valuation. The fund will be benchmarked against the S&P BSE 500 TRI, and investors are advised to have an investment horizon of two to three years. It will be managed by Manish Sonthalia and Kashyap Javeri. Live Events Small & Mid Cap (SMID) investing offers broader exposure to India's growth story through innovation, digitalisation, capex, and consumption, providing more opportunities for alpha generation compared to large caps. These sectors are expected to benefit from macro tailwinds such as easing inflation, declining interest rates, rising household income, and liquidity measures, all of which support market revival and higher growth. Given that SMID companies often rely more on borrowings for operations and expansion, they are typically more sensitive to interest rate cycles, positioning them to recover faster and potentially outperform in an environment of moderating inflation and falling rates. According to EIML, mid- and small-cap companies are poised for positive growth over the next 3–5 years, making them a compelling investment opportunity. The firm also highlights that mid- and small-cap stocks have delivered robust returns over the past five years. Furthermore, EIML notes that the current macroeconomic environment and supportive valuations offer an attractive entry point for SMID investments—especially after the recent market correction. Also Read | Gold prices may fall 12-15% in next 2 months, warns Quant Mutual Fund As of March 2025, small-cap and mid-cap mutual funds (MFs) together account for over 30% of total equity flows, a sharp increase from just 5% a year ago. The dual support from foreign institutional investors (FIIs) and mutual funds makes this rally far more sustainable. Strengthening flows into SMID segments indicate that select opportunities in small- and mid-cap stocks could outperform over the medium term. 'SMID offers a compelling mix of growth potential, valuation comfort, and supportive macro trends, making it a strong candidate for investment. The fund follows a focused bottom-up stock-picking approach, backed by in-depth fundamental research and our proprietary E-Qual Framework—arguably the only framework of its kind in India—to objectively score management quality,' said Manish Sonthalia, Director & Chief Investment Officer, Emkay Investment Managers.
News18
3 days ago
- Business
- News18
Indian Equity Market Nears Lifetime Highs: Fundamentals Or FOMO? Market Expert Bhole Weighs In
Last Updated: Indian equity market nears lifetime highs due to strong macro indicators, foreign inflows, and political stability. Atul Bhole of Kotak Mahindra AMC discusses market fundamentals. The Indian equity market has rebounded after a prolonged sluggish period and is now approaching lifetime highs. Factors such as strong macroeconomic indicators, consistent foreign inflows, and political stability are providing positive momentum. As a result, market sentiment remains optimistic despite high valuations and subdued earnings growth. Markets are dancing near lifetime highs. How much of this is driven by fundamentals and how much by FOMO? Bhole: India's macro fundamentals are currently in a sweet spot and among the strongest globally. Tightly controlled fiscal and current account deficits, lower inflation, a stable currency, and steady GDP growth of around 6–6.5% are attracting foreign flows in a big way. While these fundamentals have been strong for some time, their resilience became even more evident during the ongoing global trade war. From the start of the year until mid-April 2025, FIIs sold close to $15 billion worth of Indian equities. However, since mid-April, the trend has reversed, with FIIs buying around $5.5 billion—largely from the secondary market rather than through IPOs, QIPs, or direct stake sales. Domestic flows have also remained reasonable, with mutual funds raising cash levels and retail participation staying measured compared to the recent past. While corporate earnings growth remains muted and valuations are stretched, strong macro fundamentals are clearly driving robust foreign and domestic flows into Indian equity markets. Bhole: Several SMID stocks witnessed value erosion of 40–60% between June–July 2024 and March–April 2025. These stocks were driven more by momentum, false narratives, illiquidity, and FOMO than by sound fundamentals or reasonable valuations. Institutional investors, such as mutual funds, which rely on research and expert insights, were able to avoid such pitfalls and limit drawdowns. Some retail investors likely learnt valuable lessons during this episode and may now start appreciating the value that mutual funds and advisors add to long-term wealth creation. However, the market often behaves like a voting machine in the short term—it keeps attracting new investors or leads the same investors to repeat new mistakes. The recent sharp rally in defence stocks after the skirmish is another example of greed or FOMO overriding rational investing behaviour. Operation Sindoor has also worked like an international defence expo showcasing the might of Indian defence companies. This is also reflected in the dramatic movement in share prices. How strong is the defence story on Dalal Street? Bhole: India's defence equipment industry has gained strong momentum over the past 3–5 years, supported by a government-led indigenisation push and larger, expedited orders. The ecosystem is developing well, with private sector players emerging as credible component manufacturers. Defence stocks performed extremely well post-Covid until mid-2024, driven largely by policy support and effective execution. However, much of the returns were driven by valuation re-rating rather than actual earnings growth. Price-to-earnings multiples jumped from 10–20x to 50–60x. Between mid-2024 and March 2025, many of these stocks saw 40–60% drawdowns from their over-stretched levels. Post Operation Sindoor, defence stocks bounced back significantly and are once again trading at valuations that may not be justified by near-term fundamentals. While these companies could deliver sustained long-term growth, the market seems to have priced in too much, too soon. A period of cooling-off or extended consolidation in stock prices is likely. With valuations stretched in certain pockets of the market, do you think the Q4 earnings season was strong enough to justify the rally? Bhole: The Q4 earnings season has been muted yet again, with 5–10% earnings growth depending on the sector and company size (large caps vs. SMIDs). However, the market hasn't reacted negatively, as expectations were already lowered after three consecutive quarters of weak growth and cautious corporate commentary. Markets are forward-looking. While Q4 results aren't particularly strong, future earnings could improve due to tax breaks, a normal monsoon, stronger wage growth, continued capex, and a low base effect. The ongoing rally is being driven more by strong macro fundamentals and capital flows. A pause may occur until corporate earnings begin to align with expectations. As an investor today, would you back consumption, capex, or financials in FY26? Bhole: Post-Covid, all major themes and sectors have had their moments in the sun and are now trading at fair to high valuations. The triggers that powered past sectoral rallies have largely played out. As the market normalises, future returns will likely be driven by individual stock selection rather than broad sector bets. At a sub-sector level, we are constructive on areas like quick commerce, hospitals, power transmission & distribution, EMS, and large private banks and NBFCs. On a contrarian note, the IT sector—supported by stronger-than-expected US corporate health and good dividend yields—could also present interesting opportunities. Given current earnings momentum, macro tailwinds, and political stability bets, is Nifty 30,000 a realistic target by end of FY26? Bhole: At the macro level, India is in a strong position. However, this must begin to reflect in corporate profitability as well. After the recent rally, Indian markets are once again trading at 21–22x forward PE, which requires significantly higher earnings growth than the current pace. Earnings may pick up with rising disposable incomes, continued capex, and structural reforms. However, global trade dynamics and economic trends pose external risks. Major economies like China and Europe could begin attracting more capital depending on tariff negotiations and monetary/fiscal policy shifts, given their relative valuation advantage. The US fiscal situation and dollar strength will also influence capital flows and asset prices globally. Investors have been caught between two battlefronts lately—the global trade tariff war and near war-like tensions between India and Pakistan. Now that both seem to be easing, what are the key takeaways for investors from this double dose of geopolitical anxiety? Bhole: In the long run, stock prices are ultimately anchored to earnings growth. In the short run, markets often overreact to news and sentiment. Over the past five years, we've witnessed events that typically unfold over a decade—or even a century. From the Covid pandemic and wars to supply chain shocks, dramatic progress in computing and AI, and aggressive fiscal moves by the US—markets have endured and evolved through all of it. The key takeaway for investors is to adapt to new realities while staying grounded in timeless investing principles. Studying market history helps investors manage their behaviour better. Patience, systematic investing, and the ability to exploit fear and greed cycles are essential to achieving long-term investing goals. top videos View all Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions. About the Author Varun Yadav Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian More Stay updated with all the latest news on the Stock Market, including market trends, Sensex and Nifty updates, top gainers and losers, and expert analysis. Get real-time insights, financial reports, and investment strategies—only on News18. tags : India Stock Market Nifty stock market Location : New Delhi, India, India First Published: June 01, 2025, 15:00 IST News business » markets Indian Equity Market Nears Lifetime Highs: Fundamentals Or FOMO? Market Expert Bhole Weighs In
Time of India
22-05-2025
- Business
- Time of India
Emkay picks JK Cement, Motilal Oswal, 2 more small & midcap stocks. 4 reasons why
4 reasons why Emkay remains bullish on SMIDs: Live Events Sector preferences (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel In a bullish relook at the small and mid-cap (SMID) space, Emkay Global has reiterated its constructive stance on Indian equities and picked four stocks as top SMID ideas. The brokerage has added Bikaji Foods, JK Cement Sonata Software , and Motilal Oswal Financial Services to its SMID picks while maintaining confidence in Escorts Kubota Metropolis Healthcare , One 97 Communications (Paytm), and confidence in SMIDs stems from the belief that small and midcap stocks are not in bubble territory despite appearing elevated on headline P/E metrics. The brokerage argues that a significant portion of the Nifty's lower valuation is driven by heavy exposure (20%) to low P/E sectors like financials and energy, areas where SMIDs have relatively less a sector-adjusted basis, SMID stocks show no material deviation in valuations or fundamentals compared to their large-cap peers, it preference leans toward SMID-heavy sectors such as consumer discretionary and materials, while it remains underweight on largecap dominated sectors like financials and FMCG. This sectoral tilt, along with improving earnings quality and resilient fourth-quarter results, underpins the firm's confidence in the SMID segment.1) Emkay's bullish tilt toward SMID stocks is underpinned by supportive fundamentals, attractive sector dynamics, and a potential earnings upswing.2) With the US striking tariff deals with countries, market sentiment is steadying. Political uncertainties have also subsided, and a further ease in tensions would lead to outperformance in SMIDs over their larger peers.3) The brokerage sees earnings upgrades in FY26 as likely, citing softer commodity prices, signs of demand recovery, and anticipated monetary easing. Already, 61% of companies with broad analyst coverage are projected to report stronger EPS growth in FY26 versus FY25—a trend that could further strengthen if upgrades materialize in sectors like discretionary, energy, and technology.4) Valuations are viewed as neutral, with the Nifty trading around its long-term average. However, Emkay highlights that 30% of BSE 200 stocks are trading at more than one standard deviation above their historical P/E, suggesting investors are already rewarding earnings discretionary remains our top OW, with technology/healthcare/real estate /utilities as the other preferred sectors. We remain UW on financials and staples, where we see a severe growth-valuation mismatch. Our model portfolio remains unchanged this firm advises using any short-term pullbacks to accumulate high-beta SMID names.
