📊 More and more market pros say that valuations now favor the giants: 62% of them say so. Source: Moneycontrol Market Poll – 62% Like Large-Caps

The tide seems to be turning after a big rally in mid- and small-cap stocks over the past three months. A recent Moneycontrol poll of market experts, such as mutual fund managers, PMS heads, and brokerage analysts, found that 62% now prefer large-cap stocks over smaller ones.

🔍 What is making people change their minds? 1. Prices are too high in the larger markets

The Nifty Smallcap 100 has gone up about 25% in three months.

A lot of small and mid-cap stocks are trading at higher P/E multiples than usual.

Several analysts say that prices are going up faster than the fundamentals.

📌 2. Earnings Divergence: Large-Caps have stable, broad-based earnings

Mid-Caps: ~19% growth from last year to this year in Q4

Small-Caps: Down about 16% from last year, showing mixed results

3. Flows and positioning in the market

In May 2025, inflows into mid- and small-cap mutual funds fell by 53%.

HNIs and institutional investors are once again interested in high-quality large-cap stocks.

What do retail investors need to know? Why Large-Caps Might Be More Clear Right Now:

More liquidity and support from institutions

Visibility in earnings, being a leader in your field, and having a global presence

Usually less volatile when the market goes down

⚠️ What to Look for in Mid and Small Caps:

A lot of stocks have gone up before earnings, which makes the downside risk bigger.

Be picky: look for companies with strong balance sheets, low promoter pledging, and clear reasons for demand.

📘 Rabbit RA Strategy View Product Opportunity Type Notes

Long Rabbit Large-cap setupsGreat for keeping your money safe and growing it steadily

Swing Rabbit: Midcaps that move based on eventsOnly when the risk/reward is clear and set up

Dream Rabbit: Top earners in the premium categoryFocus on midcaps with long-term tailwinds that are of high quality.

Last Word The markets may be going through a rebalancing phase, moving from broad rallies based on momentum to stock selection based on fundamentals. Rabbit RA is still focused on data-backed clarity, not hype, as a SEBI-registered Research Analyst.

Rabbit RA is a Research Analyst (INH000010964) registered with SEBI. This blog is only for learning. There are risks in the market that come with investments. Before you invest, please read all of the scheme-related papers carefully.

🔗 Check out our plans at rabbitresearch.in.