HomePersonal Finance NewsTata Mutual Fund sees opportunity in small caps post correction

Tata Mutual Fund sees opportunity in small caps post correction

Tata Mutual Fund on Tuesday said it saw opportunity in small caps post correction.

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By CNBC-TV18 October 23, 2018, 4:43:28 PM IST (Updated)

Tata Mutual Fund on Tuesday said it saw opportunity in small caps post correction.



In an interview to CNBC-TV18's Anuj Singhal and Surabhi Upadhyay, Rupesh Patel, fund manager, said, "If you look at smallcaps and midcaps as category and after the recent categorisation circulation, which has come from Sebi that stock no 1-100 is categorised as largecap stocks and stock no 101-250 are categorised as midcap stocks."

"So 251 onwards, all stocks are categorised as smallcap stocks. If you look at this category, maybe in 2013 the market capitalisation of stock no 251 was about Rs 2,800 crore. Today that market capitalisation is at about Rs 9,500 crore odd. So thanks to this categorisation, the definition of smallcaps have become much wider and much bigger," Patel said.

He further added, "Here, we are looking at businesses, which are been through the cycles and are reasonable in size. So the risk profile is very different as compared to what it used to be in the past. Secondly, smallcaps and midcaps as a category has undergone significant correction. There are stocks, which have corrected significantly more than index and we believe that if you are willing to take 3-5 years kind of a view, it's possible to construct a portfolio of 30-40 companies and create wealth over a period of 3-5 years."

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