Top 5 Smallcap Stocks Showing Resilience in this Falling Market

In the past five trading sessions, many stocks have seen a sharp decline.

The trigger point this time was the earnings report of companies commanding rich valuations. The post results volatility has come as a shock to many traders and investors.

However, there are some stocks defying the bearish trend and showing resilience in this falling market.

These breakout stocks are experiencing a sudden and large increase in price due to positive news or because they're nearing the highest level seen in years.

If identified early, these stocks can be lucrative investments if the momentum sustains. They can also be risky as there is often limited information available about these companies and their fundamentals.

In today's article, let's look at the top smallcap stocks that are showing strength in this falling market.

These stocks are shortlisted using Equitymaster powerful Indian stock screener.

#1 Kesar India

Incorporated in 2002, Kesar India is engaged in the business of real estate development and constructing residential and commercial projects.

All its projects are marketed under the brand name "Kesar Lands".

In the past one month, the stock price has gained over 100% while in the past one year, the stock is up over 1,600%.

The steep rally seen in recent session could be attributed to its bonus shares announcement.

The company's board of directors announced issue of bonus equity shares in the proportion of 6:1, during market hours today.

The company was listed on the BSE in July 2022.

#2 Surani Steel Tubes

Next on this list is Surani Steels Tubes.

The company manufactures and supplies mild steel pipes, mild steel hollow section, mild steel coils, among other things.

It relies largely on its dealers to sell its products to its end consumers.

The steep rally in recent sessions could be attributed to changed happening in the company's capital as it has announced fundraising plans.

According to reports, the company was taken over by promoters of JTL Industries at Rs 40. The recent fundraising is also going to see promoters contributing to almost 60% of the amount meaning they're infusing money out of their pocket. Sanjay Gupta, one of its promoters, had infused funds in September 2023 too.

The company is currently planning to add more capacity.

#3 A B Cotspin

A B Cotspin is in the business of manufacturing and trading of yarns and other allied products.

The company produces 100% cotton yarns & fabrics, through more than 18,000 spindles, both combed and karded and sells to textile units in Punjab and Haryana.

The steep rally seen in its share price in recent days could be attributed to the company approving resolution plan for its debtor SEL Textiles.

The company has a location advantage as it sells directly to units in Punjab and Haryana. Both these states are well-established textile hubs with presence of a large number of spinning and garmenting units.

Despite sluggish demand, the company performed well in financial year 2023.

Last year, it raised around Rs 840 million through preferential allotment.

#4 Artson Engineering

Next on this list is Artson Engineering.

The company is engaged in the business of design, engineering, procurement and construction for the oil & gas and hydrocarbon industry.

It manufactures bulk liquid storage tanks, various kinds of heat exchangers, pressure vessels, columns & process equipment, etc.

Tata Projects had acquired 75% stake in the company in the year 2008 and since then, Artson is a subsidiary of Tata Projects, making it a Tata group stock.

In the past five trading sessions, the stock has rallied over 10% while it has rallied over 110% in the past one year.

Over the years, Artson's strong linkages with its parent company Tata Projects has helped it secure orders and grow its revenue over the years.

To help maintain liquidity, Tata Projects has extended its support to the company and infused capital of Rs 12 billion (bn) in financial year 2022.

Currently, Artson Engineering is embarking on a drive to upgrade its manufacturing facilities to increase its market share and retain the competitive advantage.

The company has a large unexecuted order book and if it manages timely execution for these, the company may grow its revenue at a stronger rate.

#5 Force Motors

Last on this list is Force Motors.

The flagship company of the Abhay Firodia group, Force Motors is in the business of manufacturing fully vertically integrated small and light CVs, multi-utility vehicles, and agricultural tractors.

It supplies these products to various countries in the Middle East, Asia, Latin America, and Africa. It was known as Bajaj Tempo till 2005.

In the past five trading sessions, Force Motors share price has rallied over 10% while in the past one year, the stock is up more than 220%.

The recent rally could be attributed to strong Q3 show by the 2-wheeler company and because the company's shares listed on the NSE.

Force Motors is currently placed third in the two-wheeler maker space. As the company focusses on niche segments, it has maintained its market share.

In fact, the company has increased its market share to over 16% in the electric 2-wheeler space.

As demand for LCV and MUVs has bounced back strongly with school openings, and a pick up seen in travel, Force Motors has a good chance to capture majority of the market share going forward.

Which Other Stocks are Showing Resilience in the Current Falling Market?

Apart from the above, here's a list of other stocks that have defied market trend and rallied in recent sessions.

Please note that these parameters can be changed according to your selection criteria.

This will help you identify and eliminate stocks not meeting your requirements and emphasise those stocks well inside the metrics.

For more, check out similar screens like breakout stocks on Equitymaster's stock screener.

Happy Investing!

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...