Correction in midcap, smallcap stocks over? HDFC Securities shares insights
HDFC Securities has been advising investors to be skewed toward the large caps for the last one year, says Dhiraj Relli, Managing Director & CEO of HDFC Securities.
- Dec 10, 2025,
- Updated Dec 10, 2025 4:20 PM IST
Amid the ongoing weakness in the stock market, Dhiraj Relli, Managing Director & CEO of HDFC Securities believes that one should stay invested in smallcap and midcap stocks. In an interview to Business Today, Relli says markets are the slaves of earnings. From last one year, HDFC Securities has been advising investors to be skewed toward the large caps because valuation in the mid and small cap have been frothy and the earnings growth trajectory is also looking weak, according to Relli.
However, Relli believes that mid caps and selected small caps will do better from here onwards for the next 12 to 18 months.
"We are at the fag end of the correction. This correction is more driven by the valuation and earning growth trajectory," said Relli. Relli said HDFC Securities has turned sanguine from neutral on mid caps and small caps.
Meanwhile, Sensex ended 275 pts lower to 84,391 and Nifty slipped 82 pts to 25,758 today. BSE small cap index fell 296 points to close at 50,305 and BSE midcap index closed 497 points lower at 45,590 in the current session.
The BSE midcap index has lost 3.12% in a month and BSE small cap index slipped 5% in a month.
Referring to the correction in midcaps and smallcaps, Relli says markets gives these kind of pains in the different cycles. "These kind of cycles do come in the market, where you have a lower earning growth and the price correction and the time correction," added Relli.
Amid the ongoing weakness in the stock market, Dhiraj Relli, Managing Director & CEO of HDFC Securities believes that one should stay invested in smallcap and midcap stocks. In an interview to Business Today, Relli says markets are the slaves of earnings. From last one year, HDFC Securities has been advising investors to be skewed toward the large caps because valuation in the mid and small cap have been frothy and the earnings growth trajectory is also looking weak, according to Relli.
However, Relli believes that mid caps and selected small caps will do better from here onwards for the next 12 to 18 months.
"We are at the fag end of the correction. This correction is more driven by the valuation and earning growth trajectory," said Relli. Relli said HDFC Securities has turned sanguine from neutral on mid caps and small caps.
Meanwhile, Sensex ended 275 pts lower to 84,391 and Nifty slipped 82 pts to 25,758 today. BSE small cap index fell 296 points to close at 50,305 and BSE midcap index closed 497 points lower at 45,590 in the current session.
The BSE midcap index has lost 3.12% in a month and BSE small cap index slipped 5% in a month.
Referring to the correction in midcaps and smallcaps, Relli says markets gives these kind of pains in the different cycles. "These kind of cycles do come in the market, where you have a lower earning growth and the price correction and the time correction," added Relli.