Nifty Smallcap Index Recovers: Breaks Two-Day Decline

The Nifty Smallcap 100 Index captures the performance of the small-cap segment of the Indian financial market. This index comprises 100 tradable stocks listed on the National Stock Exchange (NSE) and is calculated using the free-float market capitalisation method. The index level reflects the total free-float market value of its constituent stocks relative to a particular base market capitalisation value.

Recent Market Movement

On December 12, 2024, the Nifty Smallcap 100 Index hit a peak of 19,716.20, followed by profit booking that triggered a 2-session correction. However, the index ended its losing streak on December 16, 2024, closing the session in the green.

• Advances vs Declines: Market breadth showed 58 stocks advancing while 48 stocks declined, indicating mixed sentiment despite a positive close.

Valuation Metrics: What Does the PE Tell Us?

The Price-to-Earnings (PE) ratio of the Nifty Smallcap 100 Index currently stands at 35.9, which is near its 1-month high of 36.41.

• Comparison to Averages:

  • Above 3-month, 6-month, and 1-year averages.
  • Significantly higher than the 5-year average PE of 27.96.

Impressive Year-to-Date (YTD) Performance as of December 16, 2024

The Nifty Smallcap 100 Index has delivered robust returns in 2024:

• YTD Gain: 28.97%
• Past Month: 10.97% rise

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.