Small Cap Funds
Small cap stocks, for the purpose of the fund are defined as stocks whose market capitalization is in between the highest & lowest market capitalization of companies on BSE Small Cap Index
Current Scenario
• In today's economic environment, individuals with entrepreneurial mindset are exploring new business opportunities that will not only survive in a recession but will also thrive
• Emerging India is offering various growth opportunities to entrepreneurs, be it first generation entrepreneur or otherwise
• In a developing economy like India, multiple sectors provide opportunities for growth.
• Emerging sectors are true reflection of entrepreneurial spirit, new opportunities and creation of global behemoths.
• These funds invest in the companies with high growth potential.
• Small cap companies have a consortium of educated and passionate management.
• Their niche focus and ability to attract talent in form of quasi entrepreneurs and stock options.
• Small caps are potential large caps of tomorrow because of their twin benefits of high growth prospects & relatively under valuation.
• Small caps are relatively under researched, under owned and undervalued as compared to large caps, thus providing an opportunity to be re-rated.
Small Cap Classification
• There is no scientific methodology to classify Large Caps, Mid Caps and Small Caps but there are pre-defined indices on BSE & NSE.
• Mentioned below is the categorization of the same on the basis of market capitalization as on August 2010.
The Indian Small Cap Opportunity
• 4300+ Cos. listed on Bombay Stock Exchange
• 1383 Cos. with Market Capitalization of over Rs 100 Cr
• 1065 Cos. with Market Capitalization of over Rs 200 Cr
• 664 Cos. with a Sales Turnover of over Rs. 200 Cr
• 613 Cos. with an Operating Profits over Rs 25 Cr
• 548 Cos. with net profits of over Rs 10 Cr
Risk Profile for Small Cap Funds
• Long Term Investment Horizon
• High Risk/High return
• These funds aim at creating alpha for the investors
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2 comments:
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Nifty direct
Every post of yours is to good. Privileged to have your guidance. What's mean by FPO in terms of stock market?
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