Stock market selloff: Suzlon Energy, RVNL, Mazagon, Paytm shares tumble amid midcap, smallcap rout

Dozens host of midcap and smallcap stocks such as Cyient DLM Ltd, Suzlon Energy Ltd, Mazagon Shipbuilders Ltd and One 97 Communications Ltd (Paytm) plunged up to 14 per cent in an otherwise positive day for largecap indices. A total of 853 the BSE Smallcap index constituents were trading in the red against just 84 shares in black. On the other hand, 112 midcaps from the BSE Midcap index were trading lower against 20 stocks that bucked the weak trend. The BSE Midcap index and The BSE Smallcap index were down 2-3 per cent and have eroded 12-15 per cent of values since their respective 52-week highs.

The broader markets remain expensive, said BNP Paribas India, In its strategy note, it noted that most sectoral indices and stocks are trading at a premium to their last-decade average. “Most domestic-oriented sectors in India are trading at a significant premium to their counterparts in other countries, even sectors for which the earnings growth outlook has deteriorated such as consumer staples,” Kunal Vora, Head of India Equity Research at BNP Paribas said.

Vora in a note said his preference for large caps continues.

Among midcap stocks, Godrej Properties dropped 5.83 per cent to 2,228.15. Prestige Estates and Oberoi Realtors also declined 5.2 per cent and 4.9 per cent, respectively. Persistent Systems Ltd slipped 4.86 per cent. Paytm declined 2 per cent to Rs 836. CG Power, Dixon Technologies Ltd, Solar Industries Ltd, Oil India Ltd, Mazagon Dock Shipbuilders, Torrent Power, Suzlon Energy Ltd, Rail Vikas Nigam Ltd (RVNL) and SJVN fell 4-5 per cent. Delhivery, Kansai Nerolac, MRF, Relaxo, Sona BLW Precision Forgings Ltd and Tata Technologies Ltd were among stocks that hit their fresh 52-week lows today.

Among smallcaps, Cyient DLM fell 13.80 per cent to Rs 514.50. Indoco Remedies tumbled 13.41 per cent to Rs 296.50. Mukand, Kaynes, Netweb and India Cements tanked up to 12 per cent. A total of 58 index stocks hit their 52-week lows including VIP Industries, Tanla Platforms, RR Kabel, PVR Inox, Indiamart Intermesh Ease My Trip and Bata India, among others.

InCred Equities said Nifty Midcap-100 valuation is rich at a 33 per cent premium to large cap index Nifty.

“Our large-cap preference over small-caps and mid-caps, which played out well in the last six months, remains. Hopes from budget proposals pose short-term upside risks,” it said.