GAGA Share Market News

[hfe_template id='11223'] [ad_1] Synopsis There are phases when mid-cap stocks come under pressure and are among the worst performers. We have seen one such phase in the past few months. Yet, if you take the last 10 years into account, they have provided the best returns, with mid-cap indices being the top performers in that period. If you did not own mid-caps, your returns in one of the longest bull runs, would not have been very high. One reason why mid-caps do well when an economy like India grows rapidly is that these companies are nimble and capable of improving their operating matrix. And for mid-caps, “cost of capital” is an important part of this matrix. So lower costs on this front works in their favor. Some 15 years back, a company from a large industrial house raised money by floating corporate bonds at X% interest. A mid-size company raised money at X% plus 200 basis points. It was thus paying 2% more for the capital, putting it at a disadvantage. Today, that...

[hfe_template id='11223'] [ad_1] Synopsis It all started post-Covid. A number of large industrial houses announced their entry into the paint industry. From the JSW group to JK Cement, and Grasim to Pidilite, all of them entered a sector which had for long been dominated by the likes of Asian Paints. Now combine this with the fact that the Asian Paints stock, one of the biggest wealth creators on the market, has been underperforming for the last four years. Has the market priced in all the competition? Or is the sector likely to see a longer phase of competition in real business and underperformance on the street? The street has also become extremely sensitive to what happens in the company. The exit of two senior executives saw the stock slip sharply. Will the valuation matrix of the paint sector, and Asian Paints in particular, change for the better? The answer is not in black and white. What the paint industry has seen in the past four years is not usual. All of a sud...