Mutual fund managers do extensive research and apply various strategies to pick stocks. In general, they prefer companies with a good financial record, good management, scalability of the business and whose stocks are available at attractive valuations.
Small-cap stocks are risky to invest in, however, if chosen well, they can provide very good returns in a given time period, as compared to mid-cap stocks or large-cap stocks.
Here are four smallcap stocks in which mutual funds hold a significant stake*:
Kalpataru Power Transmission Limited
Kalpataru Power Transmission is a global EPC player that has an interest in power transmission and distribution, oil and gas pipelines, railways and biomass-based power generation.
It is a small-cap company with a market capitalization of ₹ 6519 crores and its shares are trading at ₹435 levels. Mutual funds collectively hold 5,12,86,168 shares in the company and this amounts to a 34.44 per cent stake.
Gateway Distriparks Ltd
Gateway Distriparks is an integrated intermodal logistics service provider that operates a fleet of more than 31 train sets and 500+ trailers. It is a small-cap company with a market capitalization of ₹ 3565 crores and its shares are trading at ₹ 72 levels. Mutual funds collectively hold 16,07,16,502 shares in the company and this amounts to a 32.17 per cent stake.
KNR Constructions Ltd
The company is engaged in the construction of roads, bridges, flyovers and irrigation projects. It is a small-cap company with a market capitalization of ₹ 6186 crores and its shares are trading at ₹ 220 levels. Mutual funds collectively hold 8,83,28,831 shares in the company and this amounts to a 31.41 per cent stake.
Multi Commodity Exchange of India Ltd
It is India’s first listed stock exchange. The company facilitates online trading of commodity derivatives transactions and provides a platform for price discovery and risk management.
It is a small-cap company with a market capitalization of ₹ 6641 crores and its shares are trading at ₹1306 levels. Mutual funds collectively hold 1,55,59,723 shares in the company and this amounts to a 30.51 per cent stake.
Note: The shareholding data is as per the June 2022 quarter, as the filings for the September quarter are awaited.
Written by Simran Bafna
Disclaimer
The content in this news article is not investment advice. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
