5 Under-the-Radar Stocks Shared by India's Top Smallcap Funds

While the broader market faces volatility, India's largest smallcap mutual fund managers are showing surprising consensus on a select group of stocks. A deep dive into the portfolios of the country's top three smallcap schemes reveals a concentrated bet on five specific companies.

The Power Trio: Nippon, HDFC, and SBI Small Cap

Data from ACE MF highlights a significant convergence among India’s heavyweight smallcap players. The three largest schemes—Nippon India Small Cap Fund (₹74,600 crore AUM), HDFC Small Cap Fund (₹38,800 crore AUM), and SBI Small Cap Fund (₹37,400 crore AUM)—collectively manage a massive ₹1.51 lakh crore.

These three funds have parked approximately ₹8,000 crore, representing 5.34% of their combined assets, into just five specific stocks. While Nippon India shows a more cautious exposure of 2.49%, SBI Small Cap displays the highest conviction, with nearly 10% of its entire portfolio riding on these five names.

Breaking Down the Five Common Bets

The shared conviction is centered on five companies that span different sectors, providing a diversified approach to smallcap investing.

  1. Krishna Institute of Medical Sciences (KIMS): This is the largest common bet by value. The three funds collectively hold ₹2,170 crore in KIMS. SBI Small Cap leads the charge with a 2.50% stake (₹935 crore).
  2. Kalpataru Projects International: Ranking second, the combined holding in Kalpataru stands at ₹2,100 crore. SBI Small Cap shows its strongest conviction here, allocating 2.76% of its corpus (₹1,030 crore) to the stock.
  3. City Union Bank: The funds have a combined exposure of ₹1,777 crore in this banking entity.
  4. PVR Inox: This entertainment major sees a combined investment of approximately ₹1,000 crore.
  5. Carborundum Universal: Rounding off the list, the three funds hold roughly ₹990 crore in this company.

Market Sentiment: Resilience Amidst Correction

The move toward these stocks comes as fund managers become more constructive following recent market corrections. Recent earnings data suggests that mid-caps delivered a robust 36% YoY profit growth, outperforming both small-caps (23%) and large-caps (10%).

Brokerages zoals Monarch Networth Capital blijven bullish en suggereren dat de "tijd- en waardecorrectie" in het SMID (Small and Midcap)-segment over de afgelopen 18 maanden bottom-up aandelenselectie zeer aantrekkelijk heeft gemaakt. Dit weerspiegelt zich in de prestaties van de Nifty Smallcap 100, die in CY26 met 4,3% is gestegen, terwijl de Nifty 50 een daling van meer dan 8% heeft laten zien.

Een waarschuwing met betrekking tot waardering

Ondanks het optimisme manen sommige analisten tot voorzichtigheid. JM Financial wijst erop dat terwijl large-caps handelen nabij hun historische gemiddelden, mid-caps en small-caps tegen hogere multiples worden verhandeld. Op basis van een geschatte P/E voor het boekjaar 2027 staat de Nifty Midcap 100 op 26,8x, gevolgd door de Nifty Smallcap 100 op 24,5x, waardoor de Nifty 50 (18,8x) het meest aantrekkelijk geprijsde segment is.

Belangrijkste conclusies