New Delhi
Indian equity markets delivered strong returns in April, with small-cap and micro-cap segments outperforming larger indices despite a weak macroeconomic backdrop marked by geopolitical tensions and rising crude oil prices, according to a report by OmniScience Capital.
The report noted that the Nifty Smallcap 250 index delivered 13.4% returns, while the Nifty Microcap 250 index surged 16.2%. Smaller companies within the firm’s “Bharat Vectors” framework also posted strong gains, indicating broad-based participation in lower market-cap segments.
A group of select 250 stocks with an average market capitalisation of around 1,500 crore delivered 25.2% returns, while another set of 250 stocks with 3,000 crore average market cap returned 23.2% during the month.
Despite concerns over inflation, currency depreciation, foreign institutional investor outflows, and global uncertainties including the US-Iran conflict, Indian equities remained resilient. The report said this reflects that markets are largely driven by company-specific fundamentals rather than macro trends in the long term.
Analysts highlighted that the rally was driven more by valuation re-rating than by a strong improvement in underlying business performance. Key financial indicators such as return on equity, leverage, and growth expectations remained stable across segments.
Valuation multiples like price-to-earnings and price-to-book ratios expanded, suggesting investors are reassessing asset prices in line with existing fundamentals after a cautious phase.
Experts also noted continued selling pressure from foreign institutional investors, with net outflows of about ₹1.75 lakh crore so far in CY26, including 44,000 crore in April alone.
Market strategists said investors should focus on low-debt companies with strong returns and sustainable growth potential as opportunities continue to emerge in the broader market spectrum.