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BEST MICRO CAP STOCKS IN INDIA FULL

Focuses on businesses with scalability, reasonable valuations and good management quality.

Invests in under-researched and under-owned stocks generally uncorrelated with broader markets.

sensitivity to various economic factors.

Uses following parameters used for stock selection.

BEST MICRO CAP STOCKS IN INDIA FULL

Aims at price discovery of small-cap stocks usually below their full potential.Prefers well-researched small-cap companies with potential to generate higher returns and become future market leaders in their segments.Uses quality metrics like cash flows, return on equity and return on capital employed to identify opportunities.Prefers well-managed small cap companies with sustainable business, sound financial strength and reasonable growth prospects.Prefers to stay away from cyclical stocks.stock prices undervaluing growth prospects,.potential to sustain above average earnings growth.Prefers companies in their early and more dynamic stage of their life cycle but not considered new or emerging.Can resort in selling when valuations become too high even if the stocks have reasonable long term growth prospects.Prefers ‘buy and hold’ strategy at most times.Strives to build a portfolio adequately reflecting a cross-section of the growth areas of the economy.Aims at an optimal mix of growth, value, economic revival and thematic plays.Adopts prudent risk management measures like margin of safety and diversification during stock selection.Aims at generating relatively better risk-adjusted performance.Identifies growth companies having reasonable size, rational valuation and quality management.Prefers businesses with scalability and the ability to benefit from the Indian economy’s growth potential.Uses bottom-up stock selection approach to identify high growth business.

Follows a blend of growth and value style of investing.Offers sustainable returns with lower volatility.Capable of sustaining good ‘Return on Equity’ and ‘Return on Capital Employed’.Looks for stability, quality and scalability during stock selection.

Invests primarily in high conviction small cap companies.

Bottom up approach to investing aimed at identifying long term opportunities.

(Data as on August 20, 2021: Source: Value Research) Investment strategies of best small cap funds 1. Table of Best Small Cap Funds for 2021: Fund Name

Small-cap stocks tend to be grow faster than large and midcap stocks during economic recoveries.

Lack of awareness and price discovery of small cap companies among market participants gives them better growth potential.

Small cap space is a relatively inefficient market with under-owned and under-researched companies.

Company specific factors impacts the returns of small cap stocks more than macro-economic factors.

Small cap companies also have greater potential to gain market share due to their new technology or products/services.

Small cap companies offer better growth prospects due to the presence of new/emerging segments growing at a faster pace.

Small cap funds offer a broader universe for investment than large cap, midcap or sector/thematic funds.