Tale of the Tape 

Good evening everyone. Welcome back to the market of stocks!

Nifty (-0.8%) and Sensex (-0.7%) fell for a fourth straight day, hurt by Trump’s new tariff threats. Midcaps and Smallcaps got KO-ed, ending down -2.1% each. A whopping 441 stocks in the NSE 500 ended in the red. Check out the Stocktwits Sentiment Meter:

Not a single sector ended in the green. Real Estate (-3%) and Metals (-2.6%) saw the most selling pressure. PS - check out our segment below on why metal took such a major hit.

Is it time to stop investing in small & midcaps? Read our top story on the stormy debate sparked by ICICi Prudential’s S Naren.

Delhivery cracked -6% on a disappointing Q3. Sun TV fell after its net profit fell -20% YoY. More details below.

Ajax Engineering IPO opened for subscription today. Check out our analysis below to help you decide whether to invest.

Trent (-4%) was the top Nifty loser. PS - the stock is down a whopping -26% YTD.

Q3 results. Zaggle Prepaid Ocean Services was locked in a -10% lower circuit despite posting decent numbers. Shipping Corporation of India cracked -6% after its PAT dropped a whopping -44% YoY.

Anant Raj gained +3% in an otherwise weak market. Global brokerage firm Nomura sees an 18% upside from current levels.

ACME Solar (-8%), Swiggy (-5%) and Ola Electric (-3%) were under pressure after their shareholder lock-in period ended. PS - Citi also cut Ola’s target price to Rs 85 p/sh vs Rs 90 p/sh earlier.

L&T Finance (-1%) forayed into the gold loan business after buying Paul Merchant Finance’s gold loan business for Rs 537 crore.

Here are the closing prints:

Mutual Funds
Time In The Market >>> Timing The Market

Should you stop all your SIPs & investments in Midcaps and Smallcaps ASAP? Yes, says ICICI Prudential’s S Naren, who triggered massive debate recently after saying it’s time to take money outta both segments “lock, stock and barrel”. Whew. FYI - Midcaps and Smallcaps are down -11% to -14% from their recent highs. And it’s clear there’s a lot more correction ahead. But is it time to panic? Here’s what you need to know. 

What’s Mr Naren so upset about? Two things. Firstly, if you started an SIP in SMIDS last year, you’ll likely have bad returns in the short-to-medium term because of how overvalued they were. Secondly, to protect your portfolio gains of the last 4 years, you need to start shifting SIP allocation to large-cap & flexicap funds.

The problem with this is that SIPs aren’t meant to time the market. Of course everyone knows getting out at the end of a bull cycle and entering in at the end of a bear market leads to INSANE returns. But as the saying goes - tops and bottoms are caught by fools and liars. On the other hand, SIPs are for the average joe who doesn't want to worry about that. Which is why 100% of experts say always invest for 7-10 years minimum, while 20+years is the golden time frame.

Go deeper: The hypocrisy is unbelievable. Yes, Naren himself may not manage an SMID fund, but the AMC he works for certainly does. They aren’t stopping SIP or lumpsums into both segments. In fact, ICICI Prudential, like every other AMC, has been cashing by offering thematic funds, special funds, literally anything to make money.

Big Picture: Yes, valuations matter. But in the long term, whether stocks or MFs, a balanced portfolio is what really matters. And yes, this has to include SOME small & midcaps, because they generate that juicy alpha. So don’t get too distracted by petty debates and most importantly stay the course.

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