Investing In Value And Multibagger Stocks

The world of small stocks is currently witnessing a quake of sorts as frothy valuations get demolished, but not all counters in this space are witnessing a downward revision. A sample of 16 such BSE-listed stocks across the sectors, which had gained more than 100 per cent and were among the top 100 gainers during the month to January 4, shows a mixed pattern.

In the last one-week, some have got corrected with volumes indicating exits by investors, while others attracted less than the usual quantity. But a few have also gone ahead in valuations.

While being a part of an index did not provide any immunity to the ongoing re-rating exercise for some stocks, certain stocks outside the BSE Small Cap Index posted recent gains.

The BSE Small Cap Index component, Jindal South West, shed 14.60 per cent in the past week, closing at Rs 2,483 with a loss of 3.67 per cent on Wednesday.

However, it had a daily volume of 20,218 shares; the fortnightly average volumes also were less than 50,000 shares.

Essar Shipping, part of the same index and also of the BSE 500, on the other hand, posted a gain of 5 per cent with an increase in traded quantity. Its weekly gain is 7.3 per cent and the month-on-month improvement is over 105 per cent.

Another stock of the BSE Small Cap, Swaraj Engineering, today finished in the red at Rs 354. This price represented a weekly gain of 3.5 per cent and a monthly gain of 82.59 per cent. But its traded volumes of late have trickled down to a few thousands shares a day.

ABL Biotech and BLB Ltd are the two gainers on Wednesday in the sample, which do not figure in any index.

The weekly loss of ABL was around 2 per cent after it recorded a gain of 2.47 per cent on Wednesday, but its month-on-month price movement showed an increase of 21.48 per cent at Wednesday's closing price of Rs 170.

BLB's week-on-week gain at close was over 3 per cent and monthly gain was 43.52 per cent. It finished Wednesday at Rs 68, with a gain of 5 per cent.

The stocks, which had less than Rs 20 market valuation, were among the top losers in the past one-week period. Maars Software lost over 22 per cent. Gujarat Lease Finance also shed over 22 per cent in a week.

Among Wednesday's losers were IKF Tech, Nandan Exim, Marmagoa, Gufic Bioscinence and SBEC Sugar and these stocks have declined over 22 per cent in a week.

In the less-than-Rs 10 category, Pentamedia Graphics lost more than 17 per cent in the last one week and 26.57 per cent in the last one month. Pentasoft Tech was, however, down 22.35 per cent in a week.