Gainers of 2015

How thought leaders ended up as winners of 2015

The big story of 2015 was that the mid-cap stocks have decoupled themselves from the large caps. Traditionally, the mid caps have tended to underperform the large caps in a falling market. But 2015 was an exception. The large cap Sensex fell by 5% during 2015, but the mid-cap index gained by 6%. It is hard to say if this is the beginning of the decoupling trend. But there are some stories that stand out in 2015.

A look at the large caps first…

 No prices for guessing, but Maruti Suzuki was the stand-out performer among the large caps with a 40% gain during the year. A sharp focus on the passenger segment, sticking to petrol versions and ensuring a wide array and variety of choice made them the leader. In a year when other auto companies struggled to give positive returns, Maruti managed to maintain top-line growth as well as margins. Lupin was another outperformer during 2015, despite a correction towards the latter half of the year. Unlike Sun and Reddy, Lupin did not have to face too many FDA issues and also maintained its growth despite margin concerns. Among the larger names, Infosys and RIL stood out purely on the strength of their individual performance in a weak environment.

Now, for the mid caps…

Interestingly, the best performers among the mid caps have been sector agnostic. In a tough year for NBFCs, Bajaj Finance and Bajaj Finserv managed above 50% returns on the back of their focus on controlling NPAs in the midst of aggressive growth. Ashok Leyland, of course, benefited with its sharp focus on the HCV space, which saw aggressive growth on a month-on-month basis. Another stock that stood out among the mid caps was Britannia which has carved a niche for itself among the FMCG companies with its staunch focus on the premium biscuit segment. That has ensured growth and margins for the company.

Losers were the sectoral suspects…

The losers were typically among the metals, capital goods, oil extraction and banking space. It was a bad year for most of them. Metal and oil prices were down due to the China syndrome. Banking continued to reel under the weight of NPAs while capital goods companies have waiting interminably for a recovery in the capital cycle. Not surprising the large cap losers include names like BHEL, ONGC, Tata Steel, SBI, Tata Motors and L&T. Even among the mid-caps the major losers have been from the banking and the infrastructure space. In fact, smaller banks have really borne the brunt of bad loans as their ability to grow their loans books has virtually been constricted. The good news for 2016 is that there is room for innovators and disrupters to outclass the market. ©

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