Midcaps are ready for a comeback: Here is how to make the most out of it
It seems 2020 holds a lot of promise for midcaps, mainly because the last two years haven’t been particularly great for them. With negative returns for two consecutive years, it looks like the year 2020 holds a lot of promise for midcaps. Based on a bottom-up view of the present situation and not just the opportunity size, it will be right to say that midcaps are not only preferable in the short term but they will remain so for a considerable period in the future.
About 2-3 years ago, our GDP figures were anywhere between 6-7 percent whereas now suddenly we are below 5 percent. The GDP growth rate has been slipping for consecutive quarters. Several policy measures implemented by the government in the last three years such as demonetisation, RERA and GST have led to a systematic slowdown of the economy. All these policies have resulted in the recalibration of the economy. RERA, along with demonetisation, have contributed to a noticeable slowdown in the real estate sector. With GST, unorganised sectors saw a major shift as companies could no longer evade tax and use it as an advantage over well-organised competitors. Many small and medium businesses which were not under the tax ambit could not…